The Kyber Network, on 22 October 2020, announced the launch of the KyberPRO framework. The framework is critical as it will enable a smooth on-chain market making. KyberPRO is an end-to-end framework for professionals to effortlessly utilize and operate a profitable market-making on-chain operation, with less smart contract knowledge.
The release of KyberPRO came after the DeFi Alliance conducted research and identified a market niche for on-chain market-making within DeFi. Most of the crucial DeFi use cases and transactions get done fully on-chain. That way, the on-chain activities offer higher profits, unlike the off-chain systems, which have less volume needed and lower profitability. A niche of professional market makers should be filled, to bring considerable liquidity and value to the DeFi space.
Before the launch of the KyberPRO, there was no suitable, effortless, and profitable system for on-chain market making. Primarily, the cause of this issue is capital and gas inefficient on-chain implementations of order books.
Automated market makers (AMMs) are also not suitable because they do not use inventory efficiently; neither do they offer control over pricing. These unsuitable market-making systems make liquidity providers lose capital due to impermanent loss that occurs during yield farming.
A Glimpse at the New Framework
The framework eliminates all the technical and operational barriers to facilitate a successful and profitable on-chain market-making operation. KyberPRO is robust, and its liquidity system proved using Kyber’s Fed Price Reserve (FPR). Professional market makers facilitated over $ 1 billion worth of on-chain trading volumes; therefore, KyberPRO is one of the most proven systems in DeFi.
In KyberPRO, professional market makers feed the prices on-chain; that is through highly capital and gas efficient mechanisms, to make a variety of tokens feasible when rapid market making. Kyber’s FPR provides significant efficiency and control for inventory utilization and pricing strategy. That way, your inventory can get used in other venues apart from Kyber, whereas, in order book model, it requires an inventory lockup.
Why Utilize the Nascent KyberPRO Framework?
KyberPRO also offers dedicated technical and operational support to the market makers; thus, an efficient developer and trading team assists market makers, by helping them set the right Framework’s infrastructure, and also gives clarification on any technical aspects. Market makers also get guides on the strategies to use to optimize gas costs while maximizing returns, and on-chain market-making advice.