Kyber Network is a liquidity protocol that is perfect for seamless and efficient token swaps in crypto transactions that involve decentralized finance (DeFi) applications.
The world of blockchain and cryptocurrency has continued to evolve since the introduction of Bitcoin. And it is amazing to see that in its decade of existence, it has blazed the trail for the emergence of more blockchain-based applications and use cases.
The finance industry has begun to experience disruptions and paradigm shifts caused by blockchain and cryptocurrency, especially with the introduction of the DeFi, which refers to a collection of finance applications that are developed with blockchain as the underlying technology to drive and facilitate different related processes.
The development of DeFi applications has paved the way for the creation of different DeFi platforms like Kyber to facilitate seamless crypto transactions of varying types. One challenge that most DeFi applications have not been able to surmount is liquidity, and this is where Kyber Network comes into the plot as the liquidity crusader.
One of the benefits of using the Kyber protocol is the ease it provides for projects to integrate the Kyber framework into its operations, because the available resources are developer-friendly and straightforward.
As stated earlier, Kyber Network was created to bring solutions to the problem of lack of liquidity between different tokens of various blockchains. In 2017, a team of visionaries came together to pool knowledge and create something phenomenal- Kyber Network was born, and its ICO was successful, with about 200,000 ETH (approximately $50 million at the time) raised by the second day of the KNC token sale.
The major team members behind the success of Kyber Network include Loi Luu (CEO and Co-Founder), Victor Tran (Lead Engineer), and Yaron Velmer (CTO). One of the peculiarities of the team is the vast knowledge that each member has garnered in different fields.
For instance, Yaron Velmer is an alumnus of Tel Aviv University where he bagged a PhD in Computer Science majoring in Game Theory. The team is supported by some notable advisors like the co-founder of Ethereum, Vitalik Buterin, Seng Hoe Long (DigixDAO, Strategic Advisor), and Simon Seojoon Kim (Hashed, CEO and Partner).
In less than 3 years, Kyber Network has achieved something that many other platforms couldn’t do, and that is the ability to build a community that is both supportive and strong.
The Kyber community is growing at an unprecedented rate, and some of its achievements since it was created include attracting more partners, decentralized applications (DApps), token projects, wallets, and liquidity takers. Oasis and Uniswap are popular exchange frameworks, and they have partnered with Kyber Network to help facilitate better functionality on “Maker” which is one of the biggest DeFi projects within the crypto community.
It may interest you to know that MyEtherWallet has also partnered with Kyber Network, as well as Decentraland, and several other popular decentralized finance (DeFi) applications.
It is important to note that despite the pandemic that ravaged the world, KNC’s daily trading volume experienced an unprecedented increase, to the point where it traded millions per day. And that is indicative of the fact that the Kyber Protocol is being adopted by many.
What is Kyber Network?
As a way to deal with the irregularities caused by the lack of liquidity between different blockchains, Kyber Network was created. Kyber Network is a liquidity framework built on the Ethereum protocol, which facilitates efficient ways of swapping different types of tokens between various blockchains.
The protocol takes different parameters into consideration, including the contributions of any party, such that they can make seamless contributions as reserve managers for the liquidity pools.
One thing that the Kyber Network hopes to achieve as its long term goal is to aid the various emerging DeFi, as well as different digital ecosystems, through the implementation and facilitation of liquidity between the various stakeholders at different levels of the ecosystem.
With the standardization of the Kyber protocol, there will be full liquidity needed to facilitate seamless and simultaneous token swaps between different blockchains.
In a recent development, an upgrade called “Katalyst” was deployed, which brought about a major improvement to the Kyber protocol.
Some of the areas that benefitted from the upgrade include the enhancement of the smart order routing, a reduction in fees for protocol transactions and activities, improved rebates, and also making it possible for various applications to set their fees as opposed to using the fees set by Kyber before the upgrade.
If you are looking for a very fast and easy way to sell and buy tokens via a decentralized platform, then KyberSwap is just the perfect platform for you to perform your crypto swaps. The user interface is intuitive and straightforward even for beginners. The simplicity of the user interface takes user experience to a whole new level thanks to seamless features and functions.
How to Use KyberSwap
Before going through the steps to using the KyberSwap exchange, it is imperative that you have an Ethereum wallet first since KyberSwap is an Ethereum-based platform. If you do not have an Ethereum wallet, then the first step would be to create one.
Once you click on Torus, a prompt pops up that gives you five different social media logins to choose from. Select your preferred login, and your Ethereum wallet will get created in no time.
You can also create an Ethereum wallet via the Metamask browser extension, or on the KyberSwap mobile application. However, if you already have an Ethereum wallet, it is important to ensure that funds have been deposited prior the swap, or you can buy from KyberSwap by clicking on the menu button (yellow highlight in picture below), scrolling down to “BUY ETH” and selecting Wyre or Moonpay to facilitate the payment.
• Step 2
If you already have a funded Ethereum wallet, then you can skip the step above. KyberSwap gives users different wallet connection options like Private Key, ledger, Trezor, Metamask, Keystore, etc. Click on the one you intend to use and you will be taken to your swap page.
• Step 3
From the landing page you can perform operations like “Swap”, “Transfer’, and “Limit order”.
The KyberSwap exchange gives you the liberty to perform different types of operations including swapping between KNC tokens and other tokens, through simple processes.
Users can also use the KyberSwap mobile app for their transactions. The app offers similar features like the web version including price alerts, analytics notifications, the redemption of Kyber gift cards, buying of more than 70 tokens, creation of secure crypto wallets, etc.
The Kyber protocol functions with the aid of a native token known as the Kyber Network Crystals (KNC), and it is used to facilitate the incentivization of activities involving stakeholders within the ecosystem.
At first, the token economics was a function of KNC token burns, such that fees gotten from network activities were used to facilitate the burning of KNC tokens, and thus increased scarcity of the tokens.
However, in the last quarter of 2019, there was a remodeling of Kyber Network, with the introduction of the Katalyst upgrade.
The upgrade brought a paradigm shift to KNC, and thus made it the governance token that it is at the moment. With the token, users have the ability to cast votes on how the protocol fees of the ecosystem should be distributed via the following channels:
• Token Burns
This refers to the part of the protocol fees utilized to burn the tokens and take them away from the open market.
These refer to rewards that are set aside for providers of liquidity, as a function of transaction volumes happening via the Kyber Network protocol.
• Staking Rewards
These are rewards allocated to KNC governance participants, as a result of their KyberDAO stakes.
Some important changes that came with the introduction of Katalyst include the following:
• Smart Order Routing
As opposed to having only one reserve, users can enjoy liquidity from different reserves at the same time.
• Reduced Entry Barriers
It is no longer a requirement for reserve managers to hold the KNC tokens to facilitate the provision of liquidity to the Kyber Network protocol.
• Custom Fees
With the Katalyst upgrade, developers enjoy the liberty of setting their fees, in place of getting subjected to the existing rates Kyber had before the upgrade.
The KNC token functions as the connector between DApps, wallets, exchanges, and the Kyber Network. 1 million KNC tokens got burned within 15 months, and right after that 2 million KNC tokens got burned within just two and a half months.
Furthermore, it took 3 months to have 3 million KNC tokens burned, and another 3 months for 4 million KNC tokens to get burned. With the scarcity of the coins as a result of the burning, as well as the increase in its trading volume, it is safe to assume that there is an increasing demand for KNC tokens.
After the Katalyst protocol was implemented, the KyberDAO was created, and its basic function was to create a connection between market participants, KNC holders, and the Kyber team. The KyberDAO will be used for the following:
• To enhance the stability of the network.
• To promote a governance system that is transparent.
• For broad representation of the Kyber Network protocol
• For the provision of strong incentives that the KNC holders can utilize for the maintenance of their stakes, as well as their involvement in governance.
• Creation of more voting options.
The KyberDAO was created as a way to empower of the community via unbiased representation on projects or subjects that are meaningful to KNC holders, and thus ensure that there is maximum transparency during the voting process, and also ensure the stability and security of the Kyber ecosystem.
How to Make Money Staking Kyber
Basically, investors within the Kyber Network ecosystem can use their tokens to stake rewards on the network. Holders of the KNC token can claim rewards, vote on topics or proposals, and stake KNC. The process to staking in Kyber is easy and straightforward. Here are the steps involved:
• Open your browser and go to Kyber.org.
• From the homepage, click on the “Get Started” button, and a prompt will pop out.
- The prompt provides you with different methods to connect your Ethereum wallet including via Metamask, Keystore, Trezor, Ledger, etc. connect your wallet.
- After connecting your wallet, you can begin staking KNC.
- After a charge-up, your stakes can then be voted via the various proposals in the governance cycles or Epoch. The process will last for 14 days.
It is important to note that your stake rewards are based on some important network parameters and metrics like the total staked tokens and Kyber exchange trading volume.
The world of blockchain and cryptocurrency keeps evolving at an unprecedented rate, and emerging systems like the Kyber Network intends to improve the network at every inch of the way, thus making the protocol better and more efficient.
One vital part of a decentralized economy is liquidity, and Kyber is working hard to have an all-inclusive network that involves the decentralized finance (DeFi) ecosystem, KNC stakeholders, and the whole crypto community, in order to promote the main adoption of decentralization.
The Kyber Network comes with a flexibility that makes it easy for wallets, applications, and protocols to perform seamless integrations of token activities into their operational models.
The protocol is doing a good job of carving a niche for itself in the world of DeFi and decentralized exchanges. The future looks bright for decentralized finance and applications, and the Kyber network is an integral part of that future.