Kyber Network: everything you need to know about KNC

What is Kyber Network?

Kyber Network is a decentralized finance (DeFi) protocol designed as an alternative to traditional exchanges, allowing users to buy, sell, and manage crypto assets. Users can seamlessly and securely trade digital assets on the Kyber platform without relying on a centralized exchange. Kyber Network leverages a network of reserves, smart contracts, and a native token called KNC to provide liquidity and facilitate transactions.

The goal of Kyber Network is to promote the adoption of decentralized exchanges and create an open financial ecosystem where users have full control over their assets.

How does Kyber Network work?

The Kyber Network protocol is built on the Ethereum blockchain and uses smart contracts to enable cryptocurrency trading. Kyber operates as follows:

1. A user looking to exchange cryptocurrencies submits a request on the Kyber Network. This request contains information about the desired transaction, such as the type of cryptocurrency to buy or sell, the amount, and the price.
2. Kyber Network then searches its order book for the best price for the transaction and selects the best liquidity provider. This can be another user on the network willing to sell the requested cryptocurrencies or a reserve of digital assets connected to the network.
3. Kyber Network executes the transaction via smart contracts on the Ethereum blockchain. Digital assets are transferred from one wallet to another, and the transaction is recorded on the blockchain.
4. The user pays a small fee in KNC tokens for the transaction. This fee is then distributed between the liquidity provider and the network itself. This system incentivizes users to participate in the network and provide liquidity.

Through this process, users can execute transactions directly with other users without the need for a central exchange or third party. Kyber Network also offers integrations with other applications and services in the blockchain space, making it easy for developers to integrate the protocol into their own applications.

The KNC token

The KNC token is the native token of the Kyber Network and plays a significant role in the network's operation. The token serves as the fuel for the network, and token holders can participate in decision-making regarding protocol changes and the issuance of new tokens.

Users pay small fees in KNC for executing transactions on the Kyber Network. These fees are distributed to liquidity providers and the network itself. KNC token holders can also participate in liquidity mining, earning KNC tokens by providing liquidity to the network. The more liquidity a user contributes, the more KNC tokens they can earn.

The Technology Behind KNC

The technology behind KNC is built on the Ethereum blockchain and employs smart contracts and other techniques to enable decentralized trading of digital assets. Key technological aspects of KNC include:

• Smart Contracts: These contain all the rules and protocols necessary to execute and manage transactions. The network uses various types of smart contracts, including reserve contracts that manage liquidity and proxy contracts that handle token exchanges.
• Reserve Managers: Kyber Network works with liquidity pools from various parties such as exchanges, market makers, and individuals. These reserves are managed by reserve managers who oversee the capital of the reserve and provide liquidity to the network. Reserve managers can configure and adjust their reserves, including adding or removing specific tokens and setting prices.
• Automatic Market Maker: Token prices are determined by supply and demand. The network uses an algorithm that calculates token prices based on available reserves, ensuring users always get the most favorable prices for their transactions.
• Support for Various Types of Transactions: Kyber Network supports token-to-token exchanges, fiat-to-crypto exchanges, and peer-to-peer transactions.
• Integration with Other Wallets and Applications: The network integrates with wallets and applications like MyEtherWallet, Trust Wallet, and Enjin Wallet, allowing users to access Kyber Network from these platforms without the need for additional authentication or login.
• Open Source Platform: This means developers can review the code and build new applications and dApps on top of the network.

The Kyber Network ecosystem

The Kyber Network ecosystem consists of various parties, each playing a crucial role in the network's growth and development. The ecosystem is designed as a sustainable and decentralized economy, where users are encouraged to participate and contribute to the network.

Users can exchange digital assets, while reserve managers provide capital to the network's reserves and receive fees for providing liquidity. Integrators are companies or organizations that integrate Kyber Network into their products and services, while developers build new applications and dApps on top of Kyber Network.

KNC token holders have various privileges and governance over the network's future. They can also participate in liquidity mining, earning special rewards and discounts.

Benefits of Kyber Network

What are the advantages of Kyber Network that attract investors?

• High level of privacy and anonymity
• Low transaction costs
• Support for thousands of ERC-20 tokens
• Wide range of services
• High compatibility with other technologies

Drawbacks of Kyber Network

What are the disadvantages of Kyber Network that investors should consider?

• Less user-friendly
• KNC has experienced significant value fluctuations since its launch
• High privacy features may lead to risks related to anonymous illegal activities

Who is the founder of Kyber Network?

The founders of Kyber Network are Loi Luu, Victor Tran, and Yaron Velner. In October 2017, Kyber Network burned over 10 million KNC tokens, reducing the coin's maximum supply to approximately 215 million KNC.

The software went live on the Ethereum blockchain in February 2018.

Price forecasts

In 2026 experts expect a minimal price of €1.79 and a minimal price of €5.93 in 2031.