Bancor, a cryptocurrency liquidity provider, announced on Monday that it has launched a new solution – BancorX – that allows users to convert between cryptocurrencies based on the Ethereum and EOS blockchains.
Prior to this, cryptocurrency traders that wanted to swap Ethereum-based tokens for EOS cryptocurrencies would have to go through an exchange.
Users of an exchange would have to first deposit their funds to the exchange – something they are often charged for doing – then place an order and, finally, wait for the exchange’s order-matching system to work its magic, again something that they would be charged for.
Bancor’s new system works by converting the token a trader possesses, whether it be Ethereum or EOS, into Bancor’s Network Token (BNT). This new token is the first cryptocurrency capable of moving between blockchains.
“BancorX is based on the ability to move BNT – Bancor’s Network Token – between blockchains,” said Eyal Hertzog, Bancor’s Co-founder and Product Architect. “This cross-chain functionality increases the utility of BNT as an inter-network token, connecting the EOS and Ethereum ecosystems today, and vastly more blockchains in the future.”
Bancor – the New Middle Man
Alongside Hertzog’s comments, the company rightly state that its new product will mean users no longer have to go through exchanges to swap currencies but omitted the fact that they, in effect, are now acting as the middle man – even if they don’t describe themselves as such.
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To give the company their due, they do claim that using the new service will wipe out many of the problems that cryptocurrency traders face when using an exchange.
Beyond not having to deposit with an exchange, traders don’t have to pay transaction fees when they use BancorX.
Transactions are also much faster. The company claims that what can take more than ten seconds on the Ethereum blockchain, only takes one second using BancorX.