BANCOR PROTOCOL || 10% payout to tron-fan-club

Bancor ICO in 2017 and raised about $153m worth Ethereum in under 3hrs as at that moment. Bancor also have a token called BNT and it was the first token under ERC20. It is also exciting to know that bancor was the very first automated market maker.

FEATURES BANCOR PROTOCOL

There are several things to talk about consigning Bancor version 2 though it will be upgraded to version 3.

• Singer Sided Staking

Bancor an amazing feature of single sided staking. hat that mean is that Bancor works differently from Chain link that forces you to half of all of your cryptocurrency assets in the liquidity pool in Ethereum. Bancor solves the problem that Chain link could not solve by creating a true sided token staking.

Here's how it works, you will provide Link asset to the liquidity pool and Bancor will mint a new token called to the other half of the pool. As you know that pool usual have two pairs. This might sound confusing to some people but I will simplify it.

For instance, you have deposit $500 worth of Link into the liquidity pool, and let assuming that BNT worth $5 at that time each, Bancor procotol will created 100 new BNT token so that the pool is now 50% of Link and 50% of BNT so that you only own Link tokens. Some of might be wondering that it will created high inflation in the token because BNT would be minted everytime someone deposit to the liquidity pool. They solve this problem this way, whenever someone withdraw there Link token from the liquidity pool, the other half of the BNT that was minted before will be burn and also the trading fee are burned.

• Impermanent loss insurance

Bancor is entitled to a little percentage from also the yields earned by the users of the protocol and they use the fund to develop the insurance. It is similar to other insurance, they use the money to raise to grow the insurance fund, that is, they use the money raised to protect themselves if something terrible happens.

All the user of the liquidity pool pay monthly to protect themselves for terrible occurrence and all that asset is use to grow the insurance fund. The users feel pay 15% of what you earn from liquidity pool and after the protocol cover the insurance fee, they then burn the excess fee.

Bancor solve the problem of getting to withdraw less Link from the protocol due to impermanent loss because during the impermanent loss the protocol would automatically sell to balance the pair. Bancor make sure that they track the amount of Link deposited into the protocol and pay the users their initial deposit including trading fee and reward on stake. They are able to do this by let the users provide 15% of their earnings as insurance funds.

The bottom line is that users can be rest assured that they can get back the initial deposit and also reward on stake and trading fees. It important to know that the use have to provide their asset for at list 100 days to get the full insurance protection but this about change in the Bancor 3.

CONCLUSION

Bancor Protocol solve a problem that other defi couldn't with impermanent insurance. With Bancor Protocol users can be rest assured that they can get back the initial deposit and also reward on stake and trading fees. It important to know that the use have to provide their asset for at list 100 days to get the full insurance protection but this about change in the Bancor 3. Thank you for reading.