Hot Topics
Coin Gecko

Advertisement

Advertisement

Bancor Plans To Airdrop Its Entire BNT/ETH Reserve To Token Holders

 
Bancor Plans To Airdrop Its Entire BNT/ETH Reserve To Token Holders
Ethereum / Breaking News

Liquidity protocol Bancor has announced radical plans to revamp its native BNT token, prefaced by an airdrop to existing token holders. The project, which sprang to life following a record-breaking ICO in mid-2017, was a forerunner to the open finance and defi movements, pioneering liquidity provisions between ERC20 tokens issued by hundreds of crypto projects. Now, Bancor intends to disburse the BNT/ETH in its reserve to holders of its native token.

Approximately 10% of Bancor’s market cap is obliged to be stored in ETH under the rules governing its protocol. Based on a current market cap of approximately $23 million, that would mean $2.3 million in BNT/ETH being airdropped to BNT holders. Holders of BNT/ETH and BNT/EOS will be able to utilize their newly received tokens as part of the BNT Liquidity Pool, and to exchange it for other tokens including ETH and supported Bancor Network tokens. This means that popular ERC20 tokens such as OMG and BAT will be exchangeable, as well as EOS, whose blockchain is also integrated with the liquidity provider.

A Giant Airdrop and an All-New Token Model

The airdrop Bancor has proposed will be one of the biggest token giveaways of its kind. The Bancor team has expressed hope that as many BNT/ETH recipients as possible are incentivized to deploy their tokens in the BNT Liquidity Pool, and to earn a share of the fees for swaps conducted between Bancor-supported tokens.

Register for the CC Forum

In addition to distributing its ETH reserve, Bancor has revealed plans to significantly redesign its native token. Following the airdrop, BNT will be repurposed as an inflationary token, with a gradual release curve that will support development of the Bancor ecosystem but without flooding the market and causing excess sell pressure. Similar to EOS, which relies on inflation through tokens awarded to block producers, a process which subsidizes the network’s free transactions, BNT will be released over time to entities working towards improving the Bancor ecosystem.

The Rise of On-Chain Governance 

Under the new setup, BNT holders will be encouraged to participate in governance matters, and to have a say on the rate of inflation and where the newly minted tokens are allocated. For instance, token holders may vote to direct BNT towards particular liquidity pools, or to fund specific developments built upon the Bancor protocol. This community-focused governance model, coupled with low inflation to fund operations, is also being trialled by forthcoming crypto exchange Digitex. A DAO will oversee the issuance of DGTX tokens, to ensure that the interests of the platform’s traders, who are also token holders, align with those of the project team.

In the case of Bancor, BNT holders will be able to approve additional funding, should they desire, for new projects incubated by Bancor Protocol developer LocalCoin. PEG Network, a project creating a stablecoin version of BNT, and CoTrader, developing a consumer-friendly front end for Bancor’s liquidity pool, are among the first beneficiaries of newly issued grants.

Bancor’s proposed airdrop will be one of the largest crypto giveaways since wallet service Blockchain.com held a $125 million Stellar (XLM) event in which $25 apiece was gifted to registered users. The amount of BNT/ETH granted to BNT holders will ultimately be determined on the date of a snapshot when BNT balances are calculated. Bancor has promised to announce the snapshot date within a month of the September 9th announcement when the project first unveiled its ambitious proposal.

You can share this post!