Decentralized Exchanges are a key component of current and future decentralized applications, due to the ability of being able to swap different tokens whilst keeping custody of your tokens in one place.
Kyber Swap has been changing the game regarding what to expect from a DEX, dismantling the old stigma of having hard to manouvre interfaces and laggy user experience that we have come to expect from DEXs in the past.
Kyber Swap has been a key player in raising the standards of how easy and frictionless swapping coins from one’s own wallet can be. The plug and swap feature for a hardware wallet user is very convenient and user friendly so the price surges we have seen regarding the KNC token are definitely not surprising.
Although they are on top of their game regarding the ease of utility and general hype surrounding their exchange platform, there are a few key factors that one should be aware of before using them:
Low Liquidity & wide bid-ask spread
One thing to note is that a maximum of around $1000 can be utilized in one swap at any time. This obstacle is easily manoeuvred by just doing multiple swaps until you are happy with your allocation of tokens.
There is also a wide big-ask spread, which means that swaps can cost you up to a 10% premium whether you are buying or selling. Pair this with the premium cost of the other token you are swapping, and things can get expensive quite quickly.
Ethereum Fees & stuck transactions
Sometimes the default Ethereum gas fee on Kyber Swap is not high enough, meaning that your transaction can get stuck on ‘pending’. If this happens, you will have to check the Nonse Value of the pending transaction and use a wallet like MyEtherWallet to resend a new transaction with the same Nonse Value.
This can be tedious work, especially the first time you go through it, so it is recommended to send the transactions as ‘fast’. I have had to go through this procedure multiple times using the default setting.
Moving Forward, with Ethereum’s up coming upgrades planned, this should not be an issue by the end of the year if all goes to plan.
Is it worth using Kyber Network?
If you want the ease of accessibility, ease of mind and convenience associated with swapping straight from your ledger, you may decide that swapping on a DEX like Kyber Network is the way to go.
If you want to get the most efficient prices, it may be worth looking at centralized exchanges with high liquidity and a tighter bid-ask spread to pay very little premium. This comes with risk factors, as well as withdrawal fees so it is up to you to decide.
Personally, if there is a cryptocurrency I require that that is on an exchange like Binance, I will probably send over my funds, trade it directly from there and withdraw my tokens straight away afterwards.
If there is an ERC-20 token that I require which is not on a trustworthy exchange, even if I have to pay a premium, utilizing Kyber Network for the swap is a no-brainer.