Bancor 3 Goes Live With Polygon, Yearn, Others as Partners

The new features aim to make DeFi staking easier for DAOs and their token holders.

May 11, 2022 at 12:43 p.m. UTC
Updated May 11, 2022 at 3:08 p.m. UTC

Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

Liquidity pools and staking product Bancor has released its "Bancor 3" protocol, which has new features meant to provide easier staking, the company said in a release shared with CoinDesk on Wednesday.

“Bancor has spent the past several years creating the equivalent of high-yield savings accounts for DeFi: Deposit your assets, sit back and earn,” Product Architect Mark Richardson said in a statement.

“By helping token projects and their users safely and simply tap into DeFi yields, Bancor 3 enables robust and resilient on-chain liquidity markets that drive healthy token economies,” Richardson added.

Bancor 3 launched out of beta with an improved version aimed at creating more sustainable liquidity by giving participants access to "Single-Sided Staking" with no risk of impermanent loss, and providing them with "Auto-Compounding" and "Dual Rewards."

Single-sided staking consists of earning yields on just one token provided by a user to a Bancor pool to maintain 100% exposure to that token. A single-sided "pool token" will be issued to users in return, with these tokens rising or falling relative to the prices of the underlying tokens.

This is in contrast to other decentralized finance (DeFi) pools that require users to deposit multiple tokens in a pool, which increases risk and exposure.

The auto-compounding features reinvest earnings back into the pools to generate higher returns. Meanwhile, dual rewards refer to third-party token projects and partners that can incentivize user liquidity and activity on Bancor.

Bancor generates millions in fees per month for depositors and offers up to 30% annualized returns on tokens such as ether (ETH), weighted bitcoin (WBTC), chainlink (LINK), and others.

Over 30 decentralized autonomous organizations (DAOs) use Bancor as a treasury management solution, including Polygon, UMA, Nexus Mutual and KeeperDAO.

The launch has attracted token projects and DAOs, including Polygon (MATIC), Synthetix (SNX), Yearn (YFI), and WOO Network (WOO), among others, to partner with Bancor and offers dual rewards to users.

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Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

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