Kyber Network Crystal (KNC) is an integral part of the Kyber Protocol and will serve crucial economic, governance and treasury functionalities across all implementations of the protocol. Networks that do not have KNC as a key part of the usage in utility and governance will not be consider and will not be supported by either the project or the community.
The exact usage of KNC in different chains is dependent on the specific implementation. Key details include specific features of the different chains and the maturity of both the ecosystem and the protocol implementation. The network maintainers are expect to make these decisions initially. After the implementation reaches a certain stage of maturity. We expect the decisions to be made by a community of KNC holders.
As such, we can expect to see a distinction between protocol maintainers, who focus on protocol-level governance like unified KNC supply, and network maintainers, who focus on the economics and technical features of the implementation on their chain.
KNC is to be use as part of the transaction to facilitate ongoing system operations. For example, getting reserves to pay a fee in KNC for every trade acts as a barrier for them to perform wash trading. This fee can be incorporate into their spread. In addition, users who need instant liquidity can pay the fees in order to get the trade facilitated.
As the scope of Kyber expands, there are several possible mechanisms to leverage KNC as a staking mechanism to acts as a barrier for malicious actors and safeguards the integrity of the Kyber ecosystem. For example, as a requirement for reserves to stake KNC to be consider part of the network. As a requirement for relayers and validators to facilitate cross-chain transactions between Kyber based networks on different chains.
Diagrams Needed for this Project are:
- Data Flow
- ER Diagram
- Schema Diagram
- Use Case Diagram