Centralized exchanges are often criticized due to some security issues and slow transaction processing. In some cases, withdrawing funds can take several days. Decentralized exchanges also have some gaps associated mostly with insufficient liquidity to support high trading activity and placing orders, if the order book is located on the blockchain. The Kyber Network team presented a solution in the form of a decentralized blockchain exchange without the order book. The Kyber Network protocol ensures an instant swap of tokens. To do this, it offers a set of liquidity pools or pools of crypto assets (also known as reserves) which can be used or integrated by a decentralized exchange or any other project. This open-source protocol is governed by a decentralized community of KNC holders. Due to the fact that KNC is based on the Ethereum protocol, each transaction is clear. The Kyber Network team created a safe and reliable platform on which users can exchange or convert any token.
Uniqueness of Kyber
The Kyber Network protocol collects liquidity from many sources. Its major purpose is ensuring an instant swap of tokens using any DApp. The project was created to provide easy access to a liquidity loop showing the most favorable swap rates. Kyber was founded by Loi Luu, Victor Tran, and Yaron Velner. A co-founder of Ethereum, Vitalik Buterin, is also a member of the Kyber Network team as an advisor. He participated in the development of the project providing secure and instant token swap at the best price. Kyber is a secure and convenient tool to swap tokens between holders of crypto currencies without a third party. It is possible due to Ethereum's smart contracts that control the correctness of the prices of assets. Besides, the protocol can be easily integrated with any other blockchain-based protocols and apps. Kyber is a rapidly growing exchange project, and its KNC token, metaphorically speaking, is the glue to connect holders of various stakes in the network.
Kyber Network has its ERC20 token called KNC (from Kyber Network Crystal) required by reserve managers to work with the liquidity network. Each swap takes a small commission in KNC transferring it to the reserve.
Decreasing Amount KNC
Portion of KNC is burned regularly in order to keep deflationary of KNC.
Smooth and reliable operation of the entire reserve system.
The system creates a classic win-win solution since entities receive referral fees for engaging new users to the Kyber Network.
In July 2020, the Kyber Network team launched the DAO program enabling KNC token holders to vote on the network key parameters.
KNC holders can use a fully verifiable, stable, and transparent protocol not only to swap tokens.
Brief History and Value of KNC
The Kyber Network Crystal token (KNC) was introduced in the second half of 2017. Initially, its price was at the level of nearly $1. The amount of KNC minted for the September ICO was 226,000,000. Only 61% of them became available to the public and 39% were divided equally among the advisors and founders of the crypto company with a lockup and vesting periods of one and two years respectively. The total amount of KNC was reduced to 210 million ones as the result of burning the 1st-millionth KNC token in May (2019) and then the company repeated the same operation three months later with its 2nd-millionth token. It is interesting that it took 15 months for the company to burn the first million KNC, but the second million was burned only 10 weeks later. That illustrates how rapid the adoption of Kyber is.