Abstract: The Bancor protocol enables built-in price discovery and a liquidity mechanism for
tokens on smart contract blockchains. These “smart tokens” hold one or more other tokens in
reserve, and enable any party to instantly purchase or liquidate the smart token in exchange for
one of its reserve tokens, directly through the smart token’s contract, at a continuously
calculated price, according to a formula which balances buy and sell volumes.
The Bancor protocol is named in honor of the Keynesian proposal to introduce a supranational
reserve currency called Bancor to systematize international currency conversion after WWII.