Bancor Network is a decentralized cross-chain liquidity protocol that facilitates the swapping of digital assets. The platform was founded in 2016. It is headquartered in Zug, Switzerland. Bancor Network functions similarly to decentralized crypto exchange (DEX), with few differences in token exchange mechanics.
Unlike other DEXs, the Bancor Network cryptocurrency exchange follows the price formation rule of the Bancor Protocol. The protocol allows users to convert tokens directly. Asset conversion rates are calculated automatically. The platform does not use bids/asks or market makers/takers. The formula for calculating price takes into account the available liquidity and current price for the given token on other exchanges.
Bancor Network crypto exchange does not require KYC compliance from its users. The protocol is accessible through the web.
Bancor Network spot trading allows instant, automated token trade. The exchange supports more than 130 coins including popular digital tokens such as Ethereum (ETH), Dai (DAI), Tether (USDT), Polygon (MATIC), and Chainlink (LINK). Also, it has over 140 trading pairs but it supports only crypto-crypto token swaps. Bancor cryptocurrency exchange trade pairs include popular markets such as ETH/USDT.
Bancor Network Token (BNT) is the native token that powers the Bancor Network cryptocurrency exchange. BNT allows traders to provide liquidity for the network’s trading pools. The token serves as the hub that connects all other tokens on the network. However, there's also USD Bancor (USDB), which is the stable form of BNT. USDB is used as a substitute reserve currency for Bancor Network. The Bancor Network crypto price increased by 86% two days after being listed in a major crypto exchange.
Bancor Network exchange fees do not follow the same model as most exchanges. The platform does not charge any listing or token conversion fees. However, since the protocol runs on Ethereum, all transactions are subject to an Ethereum gas fee. Thus, Bancor Network crypto fees are paid in ETH and transferred internally into the system. Additionally, no asset is really deposited into Bancor Network, hence, no withdrawals from Bancor Network are made, and therefore, there are no withdrawal fees.
Apart from swapping, the Bancor Network cryptocurrency exchange offers a staking feature that enables users to earn passive income by providing liquidity to liquidity pools. Though note that the Bancor Network works with two token models: liquidity tokens and relay tokens. Relay tokens are used to provide liquidity in staking. A fraction of the staked money is indicated in relay tokens. Additionally, relay tokens enable easy conversion of Bancor tokens to other tokens in a single transaction.
Any user can contribute liquidity to any pool in the exchange and receive a portion of conversion fees. Pool tokens are distributed to the contributors according to their contribution to the pool. The network uses a ConverterBase contract to manage the liquidity pool. ConverterBase contracts carry the main logic of conversion between different digital tokens.
Though Bancor also allows users to stake BNT in pools in order to receive governance token vBNT. The governance feature allows users to vote and define the future of the protocol.
Moreover, Bancor Network offers an API that enables lightweight access to Bancor Network information. Companies can access the protocol features and integrate them into their products without the complexity of querying the Ethereum network directly. The API can be used to access information about tokens, pool performance, and price performance.
Lastly, Bancor Network offers additional features to liquidity such as single-sided exposure and impermanent loss protection. Single-sided liquidity approach enables users to provide liquidity to a pool with a single token reducing the exposure to risk. The reduced risk means liquidity providers can stay long on their preferred asset, collecting returns and earning rewards without worrying about other tokens.
About the Company
Bancor Network crypto exchange was founded by Eyal Hertzog, Guy Ben-Artzi, Galia Benartzi, and Yudi Levi in 2016. The exchange is headquartered in Zug, Switzerland. The project went live with a prominent ICO, which raised more than $153 million worth of Ether.
The project announced the launch of the Bancor V2 upgrade in 2020. The upgrade introduced a new AMM liquidity pool integrated with Chainlink price oracles. The upgrade also introduced a bonding curve that reduces slippage, as well as support for a lending protocol.
The highest daily Bancor Network trade volume of $108.37 million was recorded on May 24, 2021.
Then, in 2022 the Bancor V3 was introduced. The upgrade offers even more features that would attract more users to the exchange, leading to a high Bancor Network volume. The features include instant impermanent loss protection, Dual-Sided Rewards, Omnipool, Infinity Pools, and so on.
On July 9, 2018, Bancor Network exchange experienced a major security breach that led to a loss of $23.5 million. The project's team reacted quickly and managed to recover about $10 million of the stolen funds.
Co-founder, Eyal Hertzog is a product architect of the protocol, BNT, and other products on the network. He is a popular figure in the crypto industry. Eyal Hertzog has been a technology entrepreneur for 20 years. Previously, he founded MetaCafe, a top video-sharing site with more than 50 million users.
Another co-founder, Galia Benartzi has been a tech entrepreneur for many years. Galia is s business developer. She is also the CEO and founder of Particle Code.
Guy Benartzi is an experienced technology entrepreneur. In 2005, he co-founded Mytopia, a company that develops cross-platform games for users in social media networks.
Yudi Levi is also the CTO of Bancor. Levi has over 20 years of experience in tech entrepreneurship. He co-founded AppCoin, an app that enables users to create their own crypto.