Most other (passive) balancing technologies only allow to discharge cells. However, when only a few cells are below the average voltage, it makes much more sense to charge these few single cells instead of discharging all the others and wasting their energy. With dynamic balancing, cells can even charge with the energy from other cells that need to be discharged.
Also, electrical energy storage systems with dynamic balancing use lower currents and hence need less expensive hardware.
An electrical energy storage system typically consists of a few to several hundreds of individual cells. Although the cells are supposed to be identical, small differences will always exist, causing them to behave differently. Because of small differences in capacity between the cells, problems may occur when the battery system is fully charged. Some of the cells will not be completely full, and others will be overloaded. This causes accelerated aging of the overloaded cells, only making the issue worse. In extreme cases this could lead to safety issues. Of course charging could also stop when the first cell is full, but that would limit the capacity of the total system.
Dynamic balancing is patented (WO 2011/036147).