In traditional exchanges, a token's liquidity is pegged directly to the availability of a buyer or seller at the time of a transaction. On the Bancor Network, tokens are always available for purchase regardless of trade volume. This is possible through Bancor's automated pricing mechanism which increases a token's price and its supply each time it is purchased.

In both centralized and decentralized (DEX) cryptocurrency exchanges, buyers and sellers must be matched in order for a trade to be executed. With Bancor, every transaction is executed directly against a smart contract. This means that converting a cryptocurrency does not require matching two parties in real-time with opposite wants; rather, it can be completed by a single party directly through the token’s smart contract.

Was this article helpful? 61 out of 72 found this helpful