Bancor, the protocol which enables built-in price discovery and a liquidity mechanism for tokens on smart contract blockchains has announced today a unique partnership with prediction market application Gnosis to create a joint GNOBNT Token Changer — a decentralized liquidity pool of GNO and BNT, encapsulated in a smart token. 4,000 GNO and 400,000 BNT ($1,000,000 value each) tokens will be deposited in a Gnosis-Bancor multisig wallet following the token allocation event today on June 12 at 2 pm GMT.
The funds will be progressively deposited in a token changer that will provide a decentralized and automated solution for exchanging GNO to BNT, with no (human) counter-party. Since BNT holds an ETH reserve, two-way ETH-GNO conversions will be possible as well.
The token changer will charge a small service fee that will be added to the reserves after each conversion. This will benefit all holders (buyers) of the GNOBNT smart token, as this will appreciate its price as per the Bancor protocol mechanism and formulas.
Anyone will be able to purchase these token changers with ETH, BNT or GNO. Doing so will increase the token changer’s reserve balances and reduce the slippage (cost) of each conversion for end users. The holders of the token changer all benefit from the collected fees, pro-rata.
Eyal Hertzog, Cofounder and Product architect at Bancor said:
“We love the wisdom of the crowd, especially when there’s real skin in the game to incentive integrity and authenticity. At Bancor, we’re big believers in the potential of prediction markets to harness this wisdom, and we plan to make the Bancor Network the absolute simplest way to engage with these type of markets and other blockchain products that connect people to our collaborative potential.”
“We look forward to launching this first-of-it’s-kind proof of concept and look forward to forging similar partnerships with additional popular networks in the near future. Together, let’s make all of our tokens smart.”