Bancor (BNT) is a blockchain protocol that enables purchasers of the unit to convert a variety of digital currencies directly. The name Bancor itself is derived from a supranational currency that was conceptualised by infamous economist John Maynard Keynes during the Second World War.
Due to the large number of cryptocurrencies now available, any new contender must deliver a novel concept, and Bancor certainly does this. Essentially, this altcoin concept attempts to address the issue of liquidity.
Most cryptocoins are currently traded against the market-leading Bitcoin and Ethereum, which can cause liquidity problems due to the vast disparity in unit value between the two top altcoins and every other product. Bancor attempts to solve this by enabling a vast array of cryptocoins to be bought and sold easily.
The Bancor network is built on a new class of cryptocurrencies, referred to as Smart Tokens, and a system that supports them, called smart contracts. The contracts self-execute, enabling the two parties involved to complete their proposed transaction. Smart tokens are coins that hold the monetary value of other compatible digital coins, enabling exchange to take place. Bancor also offers its own native currency token called Bancor Network Token (BNT).
The basis of Bancor is to remove the need of buyers and sellers to get involved as the cryptocurrency conversions are instantaneous. You can read the white paper on the Bancor protocol, although some market observers have asserted that this isn't a particularly clear or well-written document.
Bancor was originally registered with the Israeli Corporations Authority, by co-founders Galia and Guy Benartzi. Eyal Hertzog was the third party involved in the launch of this crypto platform.
The approach of Bancor is completely unique within the crypto sphere, and its unique selling point will definitely assist with its commercial credibility. There is no doubt that Bancor has addressed a very real problem, and that many cryptocurrency users will be appreciative of this. It should also be noted that the company provides tutorials and research material for beginners.
Counterparty risk associated with Bancor is also minimal, as the platform doesn't store tokens centrally. There is also a wide variety of tokens supported by Bancor, meaning that a diverse range of customers can get involved whenever they feel like it. Bancor is also competitive with regard to the cost of trading. However, it should be noted that this is slightly misleading, as the way that transactions are completed at Bancor does not include traditional fees, so customers are advised to be mindful of this.
On the downside, Bancor does require some technical knowledge, and those not familiar with the Ethereum ecosystem may find it a little confusing. There is also no fiat currency support, though the developers may choose to address this issue in time. We also found that some of the background data that users would require in order to make informed trading decisions is readily available.
Find out how to buy Bancor with our beginner's guide.
Bancor is not a large or particularly well-established coin. However, the fact that Bancor has such a clear use case, one that would be appreciated by many cryptocurrency advocates, indicates that the platform may continue to grow in popularity. If this occurs then Bancor could thrive as a viable service, but it isn't a crypto product that anyone should expect to rapidly escalate in value.