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The Kyber Network token (KNC) is only the 52nd-largest cryptocurrency by market cap, but that “little” coin is making some big waves—following its listing on Coinbase, the largest crypto exchange in the United States.
Just days ago, KNC was trading in the low $0.50 per coin range. Kyber’s price then jumped a remarkable 65 percent following the news that the San Francisco-based Coinbase had added support for the token across all retail platforms (except for customers based in New York and the United Kingdom). Coinbase had previously listed Kyber on its Pro platform earlier this month.
The Kyber Network is a protocol that seeks to simplify and improve the processes of swapping digital currencies by making them faster and more secure. KNC is an Ethereum-based token that’s used by Kyber users to pay fees on the network.
And the price of that token spiked to nearly $0.80 for a hot second thanks to the Coinbase Effect. But that appears to be over, for now. While the token is still priced above where it started before the Coinbase announcement, it’s now on a steady march downward back to reality.
It’s all par for the course in crypto. The Coinbase Effect is a fairly predictable phenomenon in which a token experiences a price surge following its listing on the exchange—though it appears far less lasting more recently.
One such example is Tezos (XTZ), which experienced jumps of more than 14 and 20 percent last November when Coinbase announced it was adding staking rewards and allowing Tezos holders to earn interest on its platform.
The price jump was almost immediately followed by a steep drop 24 hours later when the enthusiasm subsided.