UPDATE: Katalyst and KyberDAO are LIVE!
Save the date: 07.07.2020
After months of preparations, we’re thrilled to announce that Katalyst is ready to go live in a few days, on the 7th of July, 2020 at 7am GMT! This will usher in an exciting new era for Kyber Network with a host of major technical improvements aimed at enhancing decentralized liquidity for decentralized finance (DeFi)! Katalyst will also introduce the KyberDAO, a community platform to facilitate the decentralized governance of the protocol, and we are excited to welcome 72,000+ KNC holders to the KyberDAO!
In our Pre-DAO Poll conducted on discord earlier (422 participants), the Kyber community reached a consensus on the initial set of network fee parameters that will kick-start on-chain governance on the KyberDAO.
Option A received the majority vote. As such, once the KyberDAO is live, for any network fees collected:
- 65% will go to Staking Rewards
- 30% to Reserve Rebates for Fed Price Reserves (FPRs)
- 5% to be used for purchasing KNC tokens and burning them
Note that these are just the initial parameters. Over time, new proposals can be submitted to adjust the percentages. Below we outline what Katalyst means for KNC hodlers, DApps/Traders that use Kyber for their liquidity needs, Reserves that provide liquidity, and KyberDAO Pool Operators.
Important reminder for DApps and Reserves using Kyber: There will be a short migration phase to upgrade the protocol on 7am UTC, 7th July 2020, during which trading might be halted. Please reach out to our developer team for details.
KNC Holders can stake tokens to vote and earn rewards
Kyber Network is a fully on-chain liquidity protocol that aggregates liquidity from diverse sources and enables decentralized token swaps in any application. Once Katalyst is launched, KNC holders can stake their tokens on the KyberDAO and govern the protocol by voting on important proposals and parameters, while earning rewards (in ETH) for their efforts. Any KNC holder can contribute to Kyber’s development by participating in the KyberDAO.
How can I stake KNC on the KyberDAO?
KyberDAO will be hosted on Kyber.org (live on 07.07.2020 at 7am GMT). This is a mobile-optimised decentralized application that is built to work on any standard platform with Web3 connectivity. Examples include the DApp browsers in popular mobile crypto wallets such as Coinbase mobile wallet and imToken etc. We are working with various wallets to ensure that kyber.org is supported in as many DApp browsers as possible. To connect your Ethereum wallet to Kyber.org, Metamask, Ledger, Trezor, WalletConnect, and WalletLink are recommended.
The KNC staking and withdrawing process is very fast and simple, and can be done within a few minutes. Below we have a sneak peek from our test site showing the different functions. Note that values in the image are just for illustration purposes and the site is subject to minor changes by the time of the launch.
When can I start staking and voting on the KyberDAO?
KyberDAO will go live on 07.07.2020, and this is when the genesis Epoch 0 begins. You can start staking KNC in Epoch 0, and start voting on the first KyberDAO proposal in Epoch 1. First batch of rewards (in ETH) will be received at Epoch 2.
Please remember, if you stake KNC in Epoch “n”, you will only be eligible to vote in Epoch “n+1” (next Epoch onwards). In other words, you can only vote on proposals if you had already staked KNC in the previous Epoch. You also won’t be able to get any rewards if you do not vote.
Note that Epoch 0 will only last for 1 week (7 days), but from Epoch 1 onwards, each Epoch lasts 2 weeks.
What are the requirements for staking and voting?
You only need to stake KNC to vote and some ETH to pay for gas costs. Votes are done on-chain on Ethereum hence gas is required. You need to vote or delegate your vote to someone else in order to receive rewards. There is NO minimum or maximum KNC that needs to be staked, no hard lockup period, no ‘slashing’ (no loss of KNC due to any penalty), and no running of nodes required. Through Kyber.org, you always have full control and ownership over your KNC staked, and you can withdraw it anytime.
What kind of proposal will we vote on at Epoch 1?
Based on the Pre-DAO Poll conducted earlier, the current community consensus for the network fee parameters is: Rewards at 65%, FPR Rebates at 30%, and KNC Burns at 5%.
This is the initial breakdown of how network fees are allocated, with network fees accounting for 0.2% of the value of each trade (excludes volume from bridge reserves). These parameters take effect at Epoch 1. For Epoch 0, Kyber Network fees collected will still be burned. This will be the last batch of network fees that will use the old token model.
At Epoch 1, we will have a simple YES/NO proposal on the KyberDAO, where KNC holders can vote if they would like to maintain the status quo, continuing with the initial protocol parameters decided by the Pre-DAO Poll. If the majority voted YES, the existing parameters (Rewards 65%, Rebates 30%, Burn 5%) will continue to be used for the next Epoch. You will be able to claim rewards at Epoch 2. Please note that regardless of the result, as long as you have participated in voting, you will still receive your rewards from staking, and the community will proceed to discuss on Discord about changes to the network fee parameters.
What can I do to prepare?
You can prepare to participate in the KyberDAO by purchasing KNC on KyberSwap.com (most competitive rate for KNC) before 07.07.2020 and store them securely in an Ethereum wallet you control. As mentioned earlier, to access Kyber.org, Metamask, Ledger, Trezor, WalletConnect, and WalletLink are recommended.
If you’re keen to delegate your KNC voting power to a staking pool (instead of voting on your own on kyber.org), please do your research on the different 3rd party staking pools available. Here are some options that will be live soon:
Watch these videos
Read these articles
Get KNC from KyberSwap
- KyberSwap, one of the many DApps powered by Kyber Network, is running a $10,000 trading contest. Prepare to stake and vote on the KyberDAO by getting your KNC at KyberSwap!
What can DApps look forward to?
The ability to set your own custom spread/fee on each trade: After Katalyst, DApp builders can decide their own business model. The previous fee-sharing program (30% of the 0.25% fee) has been removed and developers are now able to set their own custom platform fee for each trade. DApp developers that build with Kyber have the ability to innovate on their business model options or target users with different needs.
Reduced network fee: Default network fee, which is charged from the value of each trade, has been reduced from 0.25% to 0.20% to improve competitiveness. Note that bridge reserves that connect liquidity from external on-chain sources like Uniswap, Oasis, or Bancor, are not charged any network fee.
Reserve routing for better rates: Reserve routing will be introduced with Katalyst, giving DApp developers the ability to route any single trade across any number of preferred reserves. This will likely provide better overall liquidity for takers in the process.
What can Reserves/Liquidity providers look forward to?
A simplified fee system: Reserves no longer need to go through the hassle of holding KNC for the payment of network fees. Network fees are automatically collected in every trade, removing a major friction and pain point for reserves that want to integrate with Kyber. This does not affect the competitive rates that our takers (DApps and end users) are enjoying now.
Reserve Rebates (Incentives): Based on the initial parameters, 30% of the network fees will go towards incentivizing Fed Price Reserves (FPR) with rebates based on how much trade volume they facilitate for the network. We expect this to incentivize more reserves creation and professional market making activity on Kyber, leading to much better liquidity.
More robust market making tools: Apart from optimising the FPR reserve type, we are committed to providing the necessary knowledge, advice, and tools required for professional market makers and advanced developers to leverage Kyber to effectively and profitably market make on-chain.
What can KyberDAO Pool Operators look forward to?
KyberDAO Pool Operators can run a staking pool and vote on behalf of KNC holders, and charge a fee for their efforts. There are different ways to run a KyberDAO Pool and prospects that are interested to run their own pools should be aware of their options.
- Use The Default KyberDAO Pool Delegation
- Deploy a Trustless Pool Operator Proxy Contract
- Deploy Your Own Unique KyberDAO Pool Token
- Operate a Custodial Pool
- Build And Deploy Your Own Smart Contracts
Read these articles for more information on the available options for Pool Operators.
- KyberDAO Pool Operator Options
- KyberDAO Staking documentation
- Protofire Trustless Smart Contract Proxy documentation
Katalyst is Coming
Katalyst marks the culmination of months of research and development by the team and we’re glad to finally be able to share this update with you. Katalyst will harmonize our efforts towards providing a single on-chain liquidity endpoint for all takers and makers, and establish a long term virtuous loop where the success of the DeFi space, growth of the kyber ecosystem, and value creation for KNC holders go hand in hand.
As the KyberDAO and protocol maintainer, the Kyber team will facilitate discussions and take on the most technically demanding operations. We are also scoping out a Kyber Improvement Proposal (KIP) framework, allowing community members to submit and discuss proposals. Selected proposals are subsequently sent to the KyberDAO platform for KNC holders to participate in on-chain voting.
We would like to conclude by saying a big Thank You to everyone in our Kyber community. We would not have been able to achieve this milestone without you. Let’s usher in this new era together on 07.07.2020!
If there are any suggestions, please raise them on the #KyberDAO channel on Discord or submit a post on Reddit. For more information, you can read our KyberDAO overview here and staking documentation on Github. You are highly encouraged to join our official Discord server and our KyberDAO twitter accountfor governance-related discussions and updates!
Important reminder for any DApp or Reserve using Kyber: There will be a short migration phase to upgrade the protocol on 7am UTC, 7th July 2020, during which trading might be halted. Please reach out to our developer team for details.
About Kyber Network
Kyber Network is delivering a sustainable liquidity infrastructure for DeFi. As a liquidity hub, Kyber connects liquidity from various protocols and sources to provide the best token rates to Dapps, aggregators, DeFi platforms, and traders.
Through Kyber, anyone can provide or access liquidity, and developers can build innovative applications, including token swap services, decentralized payments, and financial Dapps — helping to build a world where any token is usable anywhere. Kyber is powering more than 100 integrated projects and has facilitated over US$7 billion worth of transactions for thousands of users since its inception.
KyberSwap, the latest protocol in the liquidity hub, provides the best rates for traders and maximizes returns for liquidity providers.