BANCOR(BNT) is a decentralized standard protocol that lets its users issue smart tokens. In a simpler sense, it’s a platform that aims to make it much easier to launch your token. According to BANCOR developers, nowadays when people want to start tokens, they will be required to write their code and have an obligation to do complicated things that only the techie people can understand. They further added that they have purposely designed BANCOR to standardize the process to make it way easier to launch a smart token.
How BANCOR works?
Aside from it allows its users to create smart tokens quickly, they provide liquidity which means that it is compatible with previous symbols like Augur and Golem- these type of tokens will be able to work with the BANCOR system. In other words, all the tokens that exchange on Ethereum will be compatible with the BANCOR platform.
They also have a new price discovery method that works inside smart contracts (set of rules that every party should follow) the funds will be moving in and out to rebalance the costs. There’s also no counterparty risk because there will no exchanges that will happen, it’s just all about smart contracts.
Bancor video explanation
The BANCOR allows its users to create tokens, which will all be backed by other tokens. As funds move into the BANCOR system, it’s going to hold a 20% Ethereum backing and the BANCOR token can then be used to back other smart contracts, which have launched on their platform. Since crypto users can’t create tokens which have the Ethereum backed it up they will have to use the BANCOR system.