Bancor

Bancor (BNT) is the common price token used to fulfill trades and to provide liquidity on its decentralized exchange (DEX)

What is Bancor? 

  • Bancor is a mixture of a series of smart contracts that manage the on-chain conversion of tokens. The protocol makes it effortless and quick to convert tokens without having to go through an exchange. 
  • Tokens used in the network are allowed to converse seamlessly because there are no exchange or third-party platforms needed resulting in self-governing pools for tokens supported by the network.
  • BNT, built via blockchain technology, is the protocol’s main token which is the default for all smart tokens created on the network. Its goal is to offer a long-term solution to liquidity problems, hence making it different from other market makers.
  • Bancor ecosystem supports a two-way token model: liquid tokens and relay tokens

Key Metrics

TickerBNT
Token NameBancor
Token Type/ProtocolERC-20
Total Token Supply230 Million
Current Circulating Supply See Coinmarketcap
Market CapitalisationSee Coinmarketcap
Token Creation Date2016
Can it be mined?No

Who is behind Bancor?

Bancor was founded by four experienced technology entrepreneurs; Eyal Heartzog, Guy Benartzi, Galia Benartzi, and Yudi Levi. 

Eyal Hertzog is BNT protocol product architect who has been a technology entrepreneur for over 20 years and previously founded MetaCafe, a top video sharing site in Israel with over 50 million users while Yudi Levi is Bancor CTO who also co-founded AppCoin.

In addition, Guy Benartzi is the chief executive at Bancor while Galia Benartzi, the CEO and founder of Particle Code, is Bancore protocol business developer.

What is the purpose of Bancor?

Bancor aims to create  liquidity for altcoins and to remunerate liquidity providers using an automated market maker (AMM) smart contract to facilitate trades against token liquidity pools without matching buyers and sellers 

Insights

  • The Bancor protocol uses an automated market maker (AMM) smart contract to facilitate trades against token liquidity pools without matching buyers and sellers.
  • Bancor’s BNT token has a capped supply of 69 million tokens, of which approximately 65 million are already in circulation.
  • BNT, unlike many other DEX coins, allows for trades to occur between coins on different blockchains, such as across Ethereum and EOS. More chains are planned to be added to the ecosystem in future.
  • As liquidity is added to Bancor pools, the demand for BNT can be expected to grow, as every pool on Bancor must hold BNT.
  • Bancor retrieves the prices for coins locked on the platform accurately by using ‘Oracles’ – such as Chainlink – to relay prices from external sources into the system correctly.
  • The protocol allows other tokens to be liquidated as well. However, these tokens
    (also called reserve tokens) must comply with ERC-20 or EOS standards
    • A liquid token, automated token with a single reserve that mints and destroys itself, sends or removes the server token to its smart contract. It is required to reserve either BNT or a derivative of BNT token to use the Bancor network.
    • Relay tokens, used in staking to provide liquidity, indicate the proportion of amount staked to the total value in the pool so that the token holders will get a percentage of the future earnings of Bancor

Risks

  • Bancor is not intended for those who are not familiar with the Ethereum ecosystem. Even Though the protocol allows other tokens to be liquidated, the reversed tokens must still comply with ERC-20 or EOS standards.
  • BNT doesn’t have fiat currency support, accordingly, it might be considered risky for traders who aren’t experienced within this protocol.
  • Trading platform and margin trading are not provided nor supported. The interface consists of a simple order box. Therefore, beginners to the Bancor network may have to face a small learning curve.

News and Updates

  • In January, Bancor made a move to provide more liquidity and awareness for its native token. Therefore, it distributed some ETH/BNT valued at $60,000 into various wallets that were holding a required minimum of BNT. In 2017, the protocol raised more than $144M during its initial coin offering.
  • Bancor has facilitated over $2 billion trades involving several tokens including cross-chain tokens as at the time of this writing.
  • In April, 2021 Bancor rolled out Vortex, a new mechanism that allows users to increase their capital efficiency while providing liquidity in its pools. The solution allows users providing liquidity in BNT to borrow funds while continuing to obtain yield from swap fees.
  • A decentralized exchange upgrade report for Bancor’s v2.1 was released, covering the performance of its decentralized exchange over the last three months. Based on the document, the total liquidity increased by almost 1000%, resulting in the platform earning about $1.12 million in cumulative swap fees.

Community & Whitepaper Links

Disclaimer:
All investments are speculative and involve substantial risk and uncertainty. Investors should understand the nature of digital assets including the terms of return and the risk of assets. We encourage investors to fully understand the assets and the risk associated with them prior to making any investment.  

Read more