119.876 – This is how many are currently the token ethereum ERC-20.
It is a number that grows hundreds every day, but the trouble is, according to Loi Luu, CEO and co-founder of decentralized exchange Kyber Network, most of those tokens are not enough for a case of practical use.
"What we observe is that most tokens are used only in trading for trading purposes or within their specific platforms if the platform is active," Luu said.
Luu wants to change it and unlock the potential of ERC-20 tokens to be used for payments.
And to do so, Luu revealed exclusively to CoinDesk, Kyber Network will extend the on-chain in-chain liquidity contract protocol, called the Kyber Network Crystal (KNC), which underpins its decentralized exchange to allow to companies accepting payments through any ERC -20 out there.
Luu told CoinDesk: "Our main goal is to make tokens usable anywhere."
In practice, this means that companies can accept payments in any ethereum tokens and that the token can be immediately converted into any other sign.
And Luu has some experience to support their ambitions. For one, he is known to have founded Oyente, an ethereum security tool and to build a protocol that uses a scaling solution, sharilli, for the Zilliqa business blockchain, before going to Kyber Network, which facilitates instant token exchanges. etneium on its decentralized exchange (a term, although it has long been a dream in the industry, has not yet managed to meet expectations.
"With Kyber we aim to connect between ERC-20 tokens and use cases, in so that tokens can be used without problems for payments, such as loan guarantees, investment in funds and so on, "Luu said." This will certainly create more token usage. "
according to Luu, Kyber Network has already partnered with the leading ethereum game, Etheremon, the popular portfolios MyEtherWallet and Coinbase, and the Penceeth microblogging site based on Etherum to integrate KNC.
"Everyone can integrate, without a watch which dictate innovation ", Luu explained, adding:
" Well done, this protocol can be the level of transaction for decentralized economy, facilitating the exchange of value in all parts of the decentralized ecosystem. . "
Kyber Network also announced today a grant to developers that Luu said" will provide financial support to projects built in-house and around Kyber's on-chain liquidity protocol. "
And already, the startups Canal and MoatFund are getting financing.  Liquidity contracts
The key technical problem that the cryptic industry has to face is liquidity, a term that refers to the availability and the stability of cryptocurrencies  Liquidity has been at the center of Luu's research for many years, and that is what started its foray into Kyber Network, which allows seamless exchanges between different types of tokens. effects, Luu's adaptation of KNC to the business world is not a deviation from the technology behind DEX, rather, it is only an extension of technology in a wider use case.  "In terms of technical architecture, it's no different," Luu told CoinDesk. "The decentralized exchange was a case of using the chain liquidity protocol, and is just one way to use the liquidity protocol in chain that you have I love built so far. "
Taking a step back, the KNC contract has two essential components.
On the one hand, there is the aspect of the contract that concerns the instant conversions between tokens, and from the other, there is what is known as "Kyber reserve". The so-called "liquidity providers" assign tokens and ETH, the native cryptocurrency of ethereum, into a pool that is used to fuel the rest of the contract.
Because all this happens on the chain – meaning stored in a smart contract hosted on the blockchain ethereum – it does not rely on a trusted intermediary to perform operations.
Luu told CoinDesk: "These properties are fundamental to an open protocol because they allow innovation without authorization and collaboration without trust between all parties
Many (d) questions
Users who allocating tokens to the pool can withdraw funds at any time.
While this may seem troubling for encrypted enthusiasts, especially after decentralized exchange and token creation The Bancor platform has been compromised by $ 13.5 million, according to Luu, the intelligent KNC contract has been subjected to rigorous safety tests to ensure that the funds are secure in the code.
In addition to having undergone ple audits, the KNC contract is constructed in such a way that the liquidity providers still have the control of their finances, so even in case of breach of security, users can not lose funds.
According to Luu, it is for these reasons that the technology will feed many experimental payment solutions for companies and financial services.
"This protocol allows many transaction and payment streams to happen atomically and in one step between multiple parties," Luu told CoinDesk. "These use cases would otherwise be very difficult or impossible to achieve."
By making sure that trade can accept multiple tokens simultaneously and convert these tokens to other cryptographic tokens, Luu expects the technology to be very useful for decentralized applications (dapps) also in the ethereum ecosystem
"From since the overwhelming majority of interesting payment models and financial use cases require multiple token exchanges across multiple parties, this mechanism is critical to enabling innovation in many classes of dapps, "Luu said. .
Speaking of this more generally, Luu concluded:
"It is crucial to make the tokens much more liquid and useful by allowing them to be easily spent by users and integrated into the developers by the developers."
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