Bancor is a crypto project born in mid-2017.
Its name echoes that of the famous “international monetary unit” proposed by John Maynard Keynes during the Bretton Woods conference.
The Bancor proposed by Keynes was supposed to be an exclusively interbank currency, serving solely as a unit of account to calculate the net position of trade between nations. Keynes’ idea was to create a kind of clearing system for world trade after the end of World War II.
Keynes’ Bancor never became a reality, although the International Monetary Fund later took up the basic idea after the Great Financial Crisis of 2007/2008, though it imagined using its Special Drawing Rights (SDRs).
The crypto of Bancor Network (BNT)
The Bancor Network project was launched in 2017 with its BNT token.
BNT is not a cryptocurrency in the strict sense, because it does not have its own blockchain. In fact, it is an ERC-20 token on Ethereum.
Bancor was born in 2017 with an ICO that aimed to create a decentralized Liquidity Network to allow any Ethereum token to be held and converted to any other token in the same network in P2P mode, that is, without having to rely on a third party, and using automatically calculated prices and a simple wallet.
Instead, this was not the case, because the project already between 2018 and 2019 began to take a different direction.
In fact, over time it turned into a DeFi trading and staking protocol with one-sided liquidity.
The basis of the project is the Bancor DAO, whose mission is to bring DeFi mainstream by providing the easiest and safest way to trade and earn passive income.
In fact, in 2017 one of the first Automated Market Maker (AMM) liquidity pools was the one developed by Bancor, so much of DeFi’s protocols to this day are still inspired by that work.
Currently the Bancor protocol generates gains for depositors, promising up to 30% APR, on over 70 tokens including ETH, WBTC, LINK, MATIC, AAVE and others.
In addition, Bancor is the treasury and liquidity management solution used by dozens of DAOs, including Polygon, Synthetix, UMA, Paraswap, Nexus Mutual, KeeperDAO, BarnBridge, and WOO Network DAO.
The BNT token
The BNT token has had two big bull runs, and two heavy bear markets.
It debuted in the markets in mid-2017 at a price just under $3, and although by November of that year it had already fallen below $2, in January of the following year it touched its peak value at over $10.
Then again, in late 2017 and early 2018 there was a big speculative bubble that formed on several altcoins, including ETH, with truly remarkable gains.
But that bubble then burst, so much so that by April 2018 the price of BNT had already fallen to $2.2.
The decline continued until December, when it even fell below $0.5, and then after a small recovery in early 2019, it ended up plummeting to $0.2 in January 2020.
By then the cumulative loss had been 93% from the initial placement price, and even 98% from the all-time high.
In 2021 there was the second big bullrun.
By November 2020 it had already risen to around $0.6, but in March 2021 it went as low as $9, which was just below the all-time high of three years earlier.
Already in May of that year the price began to fall again, reaching $2.6 in July 2021. The price of BNT did not rise at the end of 2021, and indeed by January 2022 had already fallen to $2.3, which became $2.1 in March.
However, the real collapse came after the implosion of the Terra/Luna ecosystem in May this year, when it fell first to $1.4, and then to $0.5 in June.
The current price below $0.4 is in line with that of 2019, but higher than the 2020 lows. Specifically, it is 96% lower than the January 2018 high, but 216% higher than the March 2020 low.
It is therefore a decidedly volatile token in the medium to long term, while not particularly volatile in the short term.
The roadmap of the Bancor crypto project
In theory, the development of the project is not finished, especially since version 2.0 dedicated to DeFi is currently up and running and evolving.
Version 2.1 was launched in October 2020, which was after the first one had hit bottom, and it was a radical change in providing liquidity to AMMs with “impermanent loss protection.”
They are currently working on Bancor 3, the third version of the protocol, which will also be the largest proposed update of Bancor to date. It will introduce a new architecture that reduces gas costs and increases the efficiency of the protocol.
Bancor 3 will be implemented in three distinct phases, called Dawn, Sunrise and Daylight. Dawn will already address the main friction points of the protocol, but it will only be the beginning of what is to come in the later Sunrise and Daylight phases.
Behind this project is the DAO of Bancor Network.
In fact, the Bancor protocol is governed with a democratic and transparent voting system that allows all stakeholders to be involved.
The governance token is vBNT, which is the token that is obtained by staking BNT tokens.
The Bancor project seems to have already had two lives, the first of which has ended and the second perhaps nearing completion, but with the third version of the protocol it may well have a third.
If nothing else, the project has shown that it is able to adapt to changing times, and especially to take advantage of trends so as not to die.
Its future is uncertain, as indeed is the future of many DeFi projects after last year’s boom and this year’s implosion. But the technology on which they are based seems destined to remain nonetheless.