Hello fellow Kyberians,
2020 is almost behind us and what a year it’s been. On the one hand a global pandemic impacted all our lives and continues to affect large parts of the world to this day. On the other hand, our crypto corner of the world made significant gains on its march towards mass adoption. Our tooling got better, our products got better, and our understanding of blockchain technologies has been further advanced through exciting new experiments. ETH2.0 Phase 0 is now live and DeFi continues to innovate at a blinding pace.
2020 was an important year for Kyber Network. On-chain, the number of users, new users, and trades all more than doubled while volumes increased six fold over the previous year with December still to go. In the mission towards ever-growing decentralization, important decisions were placed in the collective hands of Kyber Network stakeholders through the KyberDAO. The KyberDAO’s first six months is a great demonstration of the viability of decentralized consensus building through on-chain mechanisms. In 2020 we also introduced KyberPRO, a powerful framework that opens on-chain market-making to professional market makers from all walks of finance. With this strong foundation we look forward to the network’s continuing growth.
The Kyber Network ecosystem is made up of different stakeholders including traders, professional reserve managers, dapps, wallets, and staking pools. As the Kyber Network team we highly value the inclusivity of these stakeholders in the KyberDAO as we believe more stakeholder voting leads to healthier consensus building and decision making. To this end, part of the team’s KNC has been delegated to 9 different stakeholders to use in the participation of the KyberDAO.
Over the last few years these teams have all contributed to Kyber’s growth either by building products on and around Kyber Network or by providing liquidity to it. With their expertise in the Ethereum and DeFi space we believe they will make a positive contribution and ultimately grow the Kyber and DeFi ecosystem together. More details can be found here
KIP5 — Kyber Listing Proposal
KIP5 is another incremental but important step forward in the network’s decentralization. It is a proposed framework that streamlines the token and reserve listing process and allows anyone to submit a request to list an ERC20 token/reserve with the KyberDAO making the final approval or rejection through a vote. You can read more here.
The latest distribution of network fees as decided by the KyberDAO are:
- 6.22% burn (% of ETH rewards converted to KNC and burnt)
- 67.32% reward to KNC stakers who vote in the KybeDAO (rewarded in ETH)
- 26.48% rebate to FPR liquidity providers (rebate in ETH)
Reserve Innovation Program
Kyber’s on-chain reserve system is incredibly flexible and allows for almost any type of reserve to be deployed. Professional market makers can deploy advanced profit-seeking reserves while token teams can deploy hands-off AMMs to provide liquidity to their tokens, there is a limitless amount of fine-tuning and design space for each reserve and each use case.
To foster innovation in this space, we are making $100,000 available in grants to teams that wish to explore and create new reserve types. In addition, we will provide practical support from ideation to production and offer mentorship as well as help promote new reserves to a wider audience. If you are interested you can read more here or reach out to us on our discord.
Kyber Network Stats
Kyber Network had its third $300M+ month as it reached $316.4M in November and unsurprisingly most dapps saw significant increases in both their USD and ETH volumes. 1inch.exchange and Fulcrum had breakout months with $103M and $56M volume respectively while the KyberSwap web, iOS, and Android apps all doubled their volumes over October.
Overall, while ETH and USD volumes were high, unique addresses and total number of trades stayed flat over September and October, indicating the same number of users are making much higher value transactions:
Professional market makers continue to dominate Kyber Network activity and account for 63% of the volume while external pools of liquidity account for another quarter of the volume:
Integration & Partnerships
Velo Labs — Velo Protocol
In November we were excited to announce our strategic and technical partnership with Velo Labs, the team behind Velo Protocol. Velo Protocol is a financial protocol that allows businesses to issue credit and transact in borderless asset transfer. Kyber Network will lend its expertise to Velo Labs in their mission to build a safe, secure, efficient and transparent federated credit exchange network. We highly recommend checking out the deep dive blog post into our partnership here.
B.Protocol is another new protocol who’s integration with Kyber we highly value and are excited about. B.Protocol is an innovative system for making interaction with existing on-chain lending platforms more secure by eliminating gas wars and shifting miners’ profits to the users.
Although the mechanics need a bit of reading to understand (full explainer here), at a basic level B.Protocol “added a dedicated Kyber reserve operator who could withdraw DAI from the reserve in times of need, use it to liquidate an unsafe MakerDAO Vault, and return the received ETH back to the reserve. At this point the reserve position manager detects that a new (short) DAI position has incurred, and will promptly work on rebalancing it over the various centralized exchanges.”
The integration has been live for over 3 weeks now with multiple Vaults already successfully liquidated even when MakerDAO keepers failed to handle the under collateralization or when Infura was down.
Of course not all Kyber integrations are financial in nature and we loved to see DeFi Socks integrate Kyber Network into their Socks Shop so that users can swap ERC20 tokens into ETH or DAI to buy the socks. You can grab your socks here.
In November we had the pleasure of coming to you with content from MoneyDance Summit where we dove into developments in on-chain liquidity over the last 3 years, discussed Kyber and its growth over the last few years at De.Fine 2020, and talked about the future of Decentralized Finance in Vietnam at TechFest VIETNAM. Bo and Shane from our team also answered your questions through the Unagii AMA.
As the year draws to a close and the festive season draws near, we as the Kyber family would like to thank you again for your never-ending support and we’d like to wish you and your loved ones a wonderful holiday season and a happy new year! See you in 2021 in what we know is going to be another stellar year for Kyber, Decentralized Finance, and the wider blockchain space!
November Photo Gallery