One of the most important projects in the world of decentralized finance (DeFi) is certainly Bancor, an on-chain protocol that provides liquidity to all those tokens that we find on the Ethereum (ETH) blockchain but also on that of EOS, since it is possible to create pool in a completely decentralized way thanks to xNation and Bancor’s new self-service front-end swap.bancor.network.
The Bancor project declares itself agnostic with respect to the various blockchains, so in the future the protocol will also be extended to other blockchains, while now it is preparing to launch the new version of the protocol on Ethereum.
The new version of Bancor allows users to provide liquidity to its AMMs (automated market maker) pools with single-token exposure and with mitigation of impermanent loss, an issue that has plagued AMMs since they first showed up on Ethereum in 2017.
Another system that is being developed is the protocol’s own DAO (Decentralized Autonomous Organization), called BancorDAO, and which allows token holders to vote and propose solutions and ideas regarding this protocol. Nate Hindman of Bancor recently remarked on Telegram, the BancorDAO will be largely based off the Yearn Finance (YFI) DAO open-source contracts:
Bancor has also previously said it is taking learnings from the beta period of its v2 to push an upgraded version of v2 that will be available to any ERC20 token, not just those with live price oracles.
From the above comment, which was followed by an interesting discussion, we can see that there will also be a quorum to be reached, which is expected to be around 20%, therefore also lower than Yearn which had around 35-40%.
It is interesting to note that the team is working with Keyko, the team behind the Ocean and Celo protocol, to create the design of the DAO and also develop the related smart contracts with which users will interact to vote and propose upgrades and so on.
Let's not forget that Bancor's token, BNT, is already on the market, both on the Ethereum blockchain and on that of EOS, and given how long it’s been around, it is one of the most widely distributed tokens in DeFi. This should help prevent whales from manipulating voting and protocol functionality.
Source: Cointelegraph
This news will also have an impact on the price of the related asset, currently up by 4%, given that everyone will start using the protocol and obtain a triple advantage:
- Provide liquidity with single-token exposure and without the impermanent loss;
- Earn BNT tokens for free via “liquidity mining”;
- Vote within the BancorDAO