The importance of exchanges to the growth of the crypto space remains unrivaled. Apart from providing users with an avenue to trade digital assets, most exchanges also offer advisory services. These services have been important to crypto adoption globally, as exchanges remain important pieces of the crypto market’s growth. Fortunately, the rapid growth of the Decentralized Finance (DeFi) ecosystem has also seen the uprising of Decentralized Exchanges (DEXs). Unlike Centralized Exchanges (CEXs) like Binance, DEXs are peer-to-peer marketplaces where cryptocurrency traders transact directly without third-party interference. The transactions facilitated in these DEXs are possible via smart contracts. Today, one of such important DEXs protocols in the DeFi space is the Ethereum-powered Kyber Network.
What Is Kyber Network?
Kyber Network is a decentralized, blockchain-based protocol that aggregates liquidity and enables crypto trading without intermediaries. Co-founded by Loi Luu, Victor Tran, and Yaron Velner in 2017, Kyber remains one of the fastest-growing DeFi entities. Its mission is to create an ecosystem where crypto tokens are usable in any wallet, marketplace, and payment service. This is why it currently integrates with more than 100 applications. This is why it can aggregate liquidity from many sources to provide secure and instant transactions on any DApp.
Kyber Network also aims to enable DApps, DEXs, and other users to efficiently access liquidity pools providing the best rates. The network utilizes three tools to run effectively, which ultimately helps with running its DEX- KyberSwap. The three tools consist of a DEX protocol, an API for asset conversion, and its native token- Kyber Network Crystal (KNC). KyberSwap runs on Ethereum and is powered by a distributed network of users and smart contracts. Like every DEX, it allows users to swap assets without a central order book or operator. Alternatively, KNC powers the protocol as both a utility and governance token.
How Does Kyber Network Work?
However, to understand how the network works, it is essential to review the components that keep it functional. Firstly, its smart contracts ensure they are adequate provisions for tokens exchanged and traded on it. Secondly, its reserves also provide liquidity to the network and its users. Lastly, the takers (DApps, Vendors, and Wallets) execute trades while removing liquidity from the network. Kyber utilizes a reserve model to provide liquidity that ensures users get the best rate when they initiate a transaction. This model searches for available reserves, providing users with the best rate from takers. Today, the three reserves that assist takers in converting tokens instantaneously for the best price in the network today are:
Price Feed Reserves (PFR)
The Price Feed Reserves is the protocol’s market maker that utilizes price feeds to determine conversion. The reserve also refers to takers to the smart contract storing all its information. From this smart contract, takers can also calculate token conversion rates.
Automated Price Reserves (APR)
While relying on smart contracts for rates, this reserve provides liquidity to the network. It executes all transactions conducted within it on the Kyber Network. Like PFR, it utilizes s smart contract which stores tokens and swaps them with other users.
Bridge Reserves
Lastly, these reserves ensure high liquidity access by linking up with other DEXs. Previously, before an upgrade to the network, reserves were needed to hold KNC to pay for networks. However, today, they need to pay these fees in ETH, which is easier and smoother for all. Portions of these fees also go to reserves, which earn them in proportion to the liquidity provided.
Why Kyber Network?
Kyber Network remains the pioneer enterprise in solving the liquidity issue in the decentralized finance (DeFi) space. Its architecture is user and developer-friendly and scalable with multiple DApps, DEXs and blockchain-based protocols. Its solutions allow developers to build products and services without worrying about liquidity. Due to security measures applied at the protocol and smart contract level, Kyber utilizes an extensive trust and secure model. This ensures that users do not interact with faulty or manipulated administrators and exchanges.
To function optimally, all transactions on it are on-chain and are verifiable via Ethereum block explorers. Last year, the network launched Kyber DMM, a dynamic market maker protocol. Kyber DMM is a next-generation AMM designed to react to market conditions instantly. This way, it can optimize fees, maximize earnings, and enable high capital efficiency for liquidity providers. Besides providing liquidity, Kyber also helps projects built on it, with multiple bespoke services and benefits. Examples of such value-added services include instant settlement of tokens, liquidity aggregation, and a customizable business model. This is why the protocol prides itself as the global leader in liquidity provision.
Kyber Network Crystal (KNC) Token
KNC is an ERC-20 token that doubles as the utility and governance token of the Kyber Network. As an ERC-20 token, it is built on and secured by Ethereum. Its holders can participate in Kyber’s governance via KyberDAO. It remains an important entity in the maintenance and operation of the Kyber Network. By staking it, holders can vote on network upgrades and policies, including fee models and rates. Like many protocols, the power holders possess is proportionate to how many tokens staked. Alternatively, by owning and staking it, holders earn rewards. Users will receive these rewards in the form of ETH for their contributions.
KNC is also a deflationary staking token, and its supply will continue to decrease over time. This is because the network fees paid for in KNC will be burned over time to reduce its supply. According to Kyber Network, it promises to improve its technology to allow KNC become a cross-chain asset in the future. KNC has a circulating supply of 177,809,350 KNC coins and a maximum supply of 210 million tokens. 61.06% of its total tokens were sold in an ICO in 2017 to raise about $52 million. Another 19.47% is for founders, advisors, and seed investors. The last 19.47% is what the company intends to use in scaling its development in the future.
How To Buy KNC
KNC is available for purchase on more than thirty exchanges, including Binance, Coinbase, Huobi Global, and Kraken. Users can purchase it via trading pairs, including USDT and BUSD. However, this step-by-step guide will help you purchase KNC on Binance;
Step 1
To buy, you will need to log in or sign up on Binance. Using your email address or phone number, you can do that on the Binance app or website. The Binance app is available for download on Android and iOs stores, compatible with their respective devices. The signing-up process is usually seamless and complete after supplying a few KYC details. To complete it, you will need to verify the information you have provided. However, existing users will only need to log in to their accounts.
Step 2
After logging in, it is essential to fund your Binance account. This will enable you to complete the purchase of KNC smoothly. Funding your account is stress-free and could be done via a bank transfer, a debit, or credit card. Binance also allows users to fund their accounts via peer-to-peer trading in some jurisdictions. Alternatively, users can also take advantage of the numerous third-party payment options available on Binance.
Step 3
You will then use the funded account to purchase BUSD or USDT on Binance. To buy, you will search for either asset via the home page and buy an amount corresponding to your balance. Lastly, now that you have your BUSD/USDT, you will use it to purchase KNC in the trade tab. Go to the market tab and search for KNC. Fill in the amount you want. You will then confirm your order at the current price. After confirmation, you can click Refresh to see the new order amount.
KNC Price Prediction
According to analysis, KNC is a highly-rated token in the crypto market, currently in the top 100. Last month, it attained a new All-time high (ATH) to cap off a remarkable period in Q1 2022. Unfortunately, it is around 60% down from such heights and looks like it’s on the way to the top. Its average 24hour trading volume is $$200,522,695.95, with a market cap of around $384 million. Despite the crypto market’s fall, its gain of 30% this week is remarkable. Despite its recent falls, its daily performance is also encouraging, attracting investors. Hence, its long-term performance predictions are great, considering its recent performances.
WalletInvestor is bullish, predicting it will reach $5.059 this year. Their forecasts for the assets in five years are also optimistic, as they anticipate it to reach $15.375 in 2027. DigitalCoin is also bullish about KNC, seeing the token hitting $7.2 this year. Like WalletInvestor, the analysts think KNC’s performance in the future will be outstanding enough. They see the token hitting $12.05 in 2025 and $26.22 by 2030. PricePrediction is also optimistic about KNC, predicting the token to hit $4.62 this year and $84.93 by 2030. In conclusion, while forecasts are great, cryptocurrencies remain volatile, and anything can happen in the future. The advice to investors is to commit funds they can lose to crypto assets.
Conclusion
Launched by Loi Luu, Victor Tran, and Yaron Velner in 2017, Kyber Networks is one of the fastest-growing protocols thriving in the DeFi space. It is a decentralized, blockchain-based protocol that aggregates liquidity and enables crypto trading without intermediaries. Kyber utilizes a reserve model to provide liquidity that ensures users get the best rate when they initiate a trade. KNC is an ERC-20 token that doubles as the utility and governance token of the Kyber Network. The token’s performance in Q1 2022 has been beyond average, hitting a new ATH. This is why the predictions for its future are great, as expectations are high.