In the earliest days of crypto, decentralized finance (DeFi) was little more than a vision. Trading digital assets without centralized exchanges posed significant challenges, and liquidity was fragmented, inefficient, and difficult to access. Against this backdrop, Bancor emerged in 2016 as a foundational force in decentralized finance with the introduction of the first Constant Product Automated Market Maker (AMM) — a breakthrough that redefined onchain liquidity and shaped the future of DeFi.
But Bancor’s origins trace back even further. The vision behind its creation was shaped by early experiments in user-generated currencies and the realization that without efficient, automated liquidity, these digital economies struggled to survive. Recognizing this challenge, Bancor pioneered a new approach to decentralized exchange — one that would become a defining pillar of onchain finance.
This blog is the first in a DeFi Q&A series exploring the technologies, challenges, and breakthroughs that shaped- and continue to shape- onchain liquidity. Dr. Mark Richardson, Project Lead at Bancor, shares deep insights into the key innovations that defined this space — starting with the origins of Automated Market Makers (AMMs) and the creation of the Bancor Protocol.
