Happy New Year and Happy New Decade dear Kyberians!
Wow, what a great year it’s been, and what a great year is coming up! In 2019 we grew, and grew, and grew. We increased our volumes, vastly expanded our ecosystem, and pumped liquidity far and wide across the Ethereum landscape. In 2020 we’re aiming even higher with the introduction of Katalyst, our major protocol upgrade that includes an exciting new DAO governance mechanism running on a completely new token model. We’ve never been more excited to tackle a new year and take Kyber to the next level!
So what is Katalyst? In a nutshell, you can think of Katalyst as the addition of new core pieces to Kyber to increase liquidity, increase stakeholder participation, and grow our liquidity protocol even further.
The first key addition is the ability to distribute protocol fees across multiple stakeholders. While until now, fees collected were either burnt or partially distributed to dapp integrations, the new model allows fees to be distributed as rebates to market makers, rewarded to KNC stakers for voting on protocol parameters, and burnt. Additionally, dapp integrations now have the freedom to set custom spreads based on their own individual business cases.
The second new piece is the release of KyberDAO. Managed by a wide range of KNC stakers including the wider community, dapps, wallets, and VCs, this DAO will be voting on how the protocol fees should be distributed amongst rebates, rewards, and burning, as well as deciding on various network updates. This gives stakeholders a direct say in the setup of Kyber Network’s incentive structure and we believe, will collectively lead to the best outcome for long term growth of the network.
Here’s an infographic with some more details and we highly recommend checking out our full blog post on Katalyst here.
Kyber Network Stats
Although December is usually a time of decreased trading activity due to Christmas and holiday festivities, for Kyber, it was a month of new all time highs across various metrics.
We saw our highest monthly trade numbers since mainnet launch with 55,867 total trades in December, highest unique number of addresses trading through Kyber at 6,897 addresses, and second highest first time addresses at 3,424 addresses.
Although ETH and USD volumes were down after November’s trading frenzy, December was still the 4th best performing month this year as measured by volume:
With 2019 behind us and Q4 complete, we can also look back at growth on a longer term quarterly scale. We can clearly see continuing growth momentum that has lasted since Q1 2018’s mainnet launch:
Looking at month-on-month ecosystem stats, we can see some integrations with lower volumes in December compared to November, while roughly the same number of dapps have managed to increase volumes:
The 5 integrations showing the highest month-on-month growth (excluding anonymous integrations) include for the fourth straight month, mobile versions of KyberSwap and we are pleased to see the continuing adoption across both iOS and Android.
All major integrations saw significant volumes in 2019 and we could consider this a break-out year in terms of ecosystem growth:
KyberSwap + ENS
You can now send tokens to .eth web addresses from KyberSwap! We’ve been keenly following ENS’ development over the last few years and believe it is an important piece of infrastructure making Ethereum more accessible to everyday users (FYI: ENS, aka Ethereum Name Service, allows web addresses ending in .eth to resolve to Ethereum wallet addresses).
With the addition of ENS support to KyberSwap, instead of having to copy/paste tedious Ethereum addresses when transferring crypto, you can simply type out and send to any .eth web address (ie. you can send to yourname.eth). You can read more here.
KyberQuick, developed by Nenad from DeFi Saver and winner of one of the Kyber Virtual Hackathon prizes, is also built using ENS and Kyber. Any user can send ETH to dai.kyberquick.eth, knc.kyberquick.eth or mkr/usdc/bat.kyberquick.eth to automatically have their ETH converted to these tokens and sent back to their wallets.
Kyber DeFi Updates
The Kyber DeFi volumes table has a new leader! Volume swings between November and December saw 1inch.exchange, a dex aggregator that pulls in liquidity from Kyber and other liquidity sources, rise to the top of the table while other DeFi dapps saw drops in their volume:
DeFiZap, the Kyber DeFi Hackathon winner, is back with a big UI update and a highly convenient 1-click ETH to cDAI/ETH Pool Token feature.
The 1-click transaction is executed by using Kyber to convert half the ETH put up by the user into DAI, using that DAI to mint cDAI on Compound, and adding that cDAI, together with the remaining half of ETH, into a Uniswap cDAI/ETH liquidity pool. This allows users to generate Uniswap trading fees while earning interest on cDAI.
This is a great example of the financial composability available within the Ethereum space. We highly recommend browsing the other Zaps to see the different kind of platforms that have been used to create these financial instruments. Below we have examples of Maker+Kyber+Uniswap for CHAI, and Kyber+Compound+Fulcrum for the Lender Zap
New DApp Integrations
We are so happy to see that for the second consecutive year, EthCC will be allowing attendees to pay for their conference tickets in any ERC20 token they want thanks to a KyberWidget integration.
EthCC is one of the most well regarded conferences in the Ethereum space and hundreds of devs descend to Paris every spring to discuss all things Ethereum. They also lead by example with their detailed conference transparency reports where they break down costs and budgets, and we highly recommend checking out their reports here.
This year’s EthCC integration also introduced us to Unlock Protocol, an impressive platform that allows monetization of content, apps, communities, and real life events like EthCC. They are already being used by Forbes and we can easily see them serving a mainstream market and helping drive adoption of decentralized technologies.
Edcon is another event we love to attend every year and similiar to last year, attendees can buy tickets in the ERC20 of their choice. This year sees the event move from Sydney to Vienna and Vitalik and co will be talking about the latest developments around ETH2.0 and 1.x.
I’ll also be giving a talk about the growth of the DeFi space and what the 2019 on-chain metrics tell us about what we can expect in 2020, so if you’re attending please say hi!
Switcheo is a multi-chain DEX that allows for cross-chain trading of Ethereum, EOS and NEO based tokens. They’ve just completed a direct smart-contract level integration with Kyber Network to allow the platform to access Kyber’s liquidity and improves the overall liquidity of Switcheo Network.
After listing EDO, the utility token at the center of the Eidoo ecosystem, last month, Eidoo is back on our radar with a native Kyber wallet integration. This allows Eidoo wallet users to convert one token to another without having to leave their wallets or navigate through a dapp browser.
Reserves and Tokens
December saw the introduction of four tokens and four reserves on Kyber Network:
NEXXO — Nexxo is a blockchain-powered small-business financial services platform. The NEXXO token is used to offer liquidity, reward enablers, and offer various other utility services to NEXXO holders.
SAN — Santiment is a market intelligence platform focusing on reliable data feeds, low-latency signals and custom market analysis. The SAN token provides access to SANBase or other discounts.
SPIKE — Spiking is a mobile social trading platform which provides financial information on the major stock exchanges in the world.
USDS — USDS, or Stably Dollar, is a stablecoin fully backed 1–to-1 and redeemable for USD held in an FDIC-insured trust account. It is currently the 7th largest USD-backed stablecoin on the market.
NEXXO, SAN, and SPIKE will have automated price reserves (APR) providing liquidity for them, while USDS liquidity will be provided by the Kyber Price Feed Reserve (PFR)
The fourth reserve to join Kyber Network in December is the Bancor Bridge Reserve. This reserve will connect Bancor’s BNT liquidity pool to Kyber Network.
As announced recently, there are no Kyber protocol fees applied to Bridge Reserves. This ensures that end users can access Uniswap or Oasis or Bancor’s liquidity through Kyber without any price penalty and without the need to use these DEXs individually.
December’s reserve metrics are a story of two tales. On the one hand, the number of trades facilitated by reserves on Kyber Network has gone up 25% from 44,700 trades in November, to 55,800 trades in December. On the other hand, November’s bear market continued into December, and with dropping crypto prices, volumes are down across most reserves.
December was the month we saw the ‘flippening’ between DAI and SAI. As the Maker ecosystem shifts to multi-collateral DAI, SAI usage has dropped and we saw a 62% drop in SAI volume, and a 68% increase in DAI volume.
KNC and ENJ were two other tokens showing strong volume growth despite the generally lower volumes in the crypto market.
Kyber in the media
Unsurprisingly, with the hype and excitement around our Katalyst announcement, December saw a surge in Kyber Network media mentions. Our twitter Katalyst announcement itself was viewed more than 250k times, with dozens of publications including Coindesk, Yahoo! Finance, The Defiant, Blockonomi, Messari, and others, covering the news.
In other parts of the web, DappRadar featured Kyber as the most popular exchange of 2019 as measured bu daily unique wallets, Paradigm highlighted Kyber’s growth over 2019 and plans for 2020, and Rubika Ventures, a publish0x publisher, dived into a technical and fundamental review of Kyber.
As lovers of hackathons and strong believers in their power to incubate ideas and turn them into fully functional products, we thought it would be apt to highlight four upcoming virtual hackathons that you can participate in from the comfort of your couch at home in the next few weeks and months:
We’re also very excited to be sponsoring EthDenver middle of February 2020. Last year’s hackathon was one of the largest on the calendar and we loved the vibe and atmosphere. We’ll be sharing more info on the available bounties in an upcoming blog post, keep your eyes out for the world’s first large-scale event DAO!
We were also happy to see two Kyber-related projects win prizes from TheGraph’s recent online hackathon. Mjc and Sudeep created a Kyber subgraph on address and token analysis while Caleb built a Kyber subgraph that focuses on liquidity pools and trades.
During December we also had the pleasure of seeing you at events and meetups across India, Vietnam, Japan, and SE Asia.
Sunny, KyberSwap’s Head of Product, was on hand in Bangalore to discuss how Kyber is enabling blockchain development through token swaps, Jason, Head of Vietnam Marketing, introduced KyberDAO to the Hanoi crypto community, and Taisuke, our Japanese Community Manager, co-hosted a DeFi talk with Maker.
In January you’ll be able to catch us at the Crypto2020 Online Summit. Tickets are free until the 23rd of January and you can participate online to hear Loi join Maker, Augur, Celsius and other projects to discuss crypto going into 2020.
And that’s a wrap for another ecosystem report dear readers. We hope you’re happy with our progress for 2019 and that you have your staking hats and shoes on for 2020 because we’re in for another very exciting year! We are driven by the energy we get from you, the Kyber and Ethereum communities, so please continue to support us and continue to support the decentralization movement, and by this time next year, we will be even closer to mainstream adoption!