Kyber Network

[loiluu]

dap: 2
project name: Kyber Network
main site: [https://kyber.network](https://kyber.network)
author: Loi Luu (@loiluu)
status: In Review
created: 2018-09-10

Simple Summary

On-chain Liquidity protocol to allow open contribution and access to liquidity for end users, wallets and dapps.

Abstract

Kyber's on-chain liquidity protocol allows anyone (end users, wallets, dapps) to seamlessly tap on the available liquidity to perform on-chain atomic tokens swaps, which is a crucial function in many of the common use cases. For example, users will be able to seamlessly convert between any tokens, or pay from any token that they have when shopping. Funds can easily rebalance their token portfolios, or lender can immediately liquidate borrower's token collateral to get back their inventory.
These use cases would otherwise be very difficult or impossible to achieve. The liquidity is in turn provided by reserves who offer their best available exchange rates.

Resources

• Site - https://kyber.network
• Code - https://github.com/kyberNetwork/
• Dev portal - Developer portal

Motivation

Kyber's protocol enables many transactional and payment flows to happen atomically and in a single step between multiple parties.

• For end users, they can swap tokens directly using services such as KyberSwap, Easwap.
• For wallets like MEW and imToken, they have embedded Kyber natively to allow their users to swap tokens in one single step within their platform, without leaving to other sites or trusting other services.
• DApps can use it to enable crucial payment and financial flows which would otherwise be impossible.

The fact is that most interesting payment patterns and financial use cases require multiple token swaps between several parties (e.g. using any token to by virtual land in Decentraland, liquidating token collateral to get back in ETH, etc), Kyber, by having both liquidity and prices on chain, is critical in enabling innovation in many classes of dapps.

Specification

• https://developer.kyber.network/docs/ArchitectureOverview

Rationale

Kyber's design offers 3 important properties that are essential to the feasibilities of consumer facing applications.

• Instant confirmation. A transaction happens with instant confirmation if it's sent from on-chain entities like smart contracts. Otherwise, once the transaction is included on the blockchain, the execution triggered by the transaction is immediately confirmed.
• Operation certainty, no transactional risk. Users know the rate and how much liquidity is available before they commit their transaction. There is no settlement uncertainty or counterparty risk.
• Global and diverse pool of different tokens. Kyber welcomes token holders to contribute their token to the liquidity pool. By having their token made available to the liquidity pool, the token will be available in all services integrated with the protocol.

Our design principle is to focus on the ease of integration, security and transparency for both liquidity providers and projects that want to tap into the liquidity pool to utilise it for their own need. The platform runs entirely on-chain, powered by Ethereum smart contracts. Reserves also keep and contribute liquidity for their token via smart contracts that they control (source code prepared, tested and provided by us). At no point does Kyber controls users’ funds. Hence, users' funds will not be affected, even in hacking incidents. All operations happening in Kyber Network can be publicly verified on the blockchain.