A unique feature of KuCoin that new users might not know about is KuCoin’s own cryptocurrency: KuCoin Shares (KCS). KuCoin has become increasingly popular with cryptocurrency investors recently, growing to over 500,000 users in only 4 months of operation. A lot of this growth was due to the wide variety of cryptocurrencies on offer, along with the fact that KuCoin was one of the only exchanges that hadn’t closed registrations to new users. The mysterious KCS are available for exchange on KuCoin and entitle well-informed users to some very attractive benefits. KuCoin has found a way to make a cryptocurrency that will be able to not only give great returns on your investment, but actually pay you commissions while you hold it. If you haven’t invested in KuCoin shares yet, you’d better get in quick if you want to maximize your returns! It’s one of the best cryptocurrency investments at the moment – here’s how it works.
KuCoin shares will earn you passive income
One of the biggest benefits of holding KuCoin shares is that you’re entitled to a portion of KuCoin’s profits. Currently, 50% of all trading fees received are distributed amongst KCS holders. As the exchange grows, the KuCoin team plans to slowly reduce this amount to a minimum of 15%. As you’ll see, even at 15% this can still lead to significant returns. This is huge for cryptocurrency traders; instead of risky investments, you can receive guaranteed passive income.
How much do you get?
The trading fee on KuCoin is 0.1% for both buyers and sellers, meaning that on any trade, 0.2% of the coins are collected. Therefore, as 50% of these fees go to shareholders right now, 0.1% of KuCoin’s overall trade volume will be distributed. KuCoin’s current 24 hour trading volume is approximately 200 million USD, meaning that $200,000 will be awarded to shareholders each day. About 90,000,000 KCS are currently in circulation, so you would earn 22 cents per day ($80.3 per year) for every 100 shares you hold.
Considering that 100 KCS currently costs $2000, it doesn’t seem like a very good investment at first glance. When you consider the potential of KuCoin, though, purchasing KuCoin shares starts to make more sense. The current trading volume on KuCoin is relatively low when you compare it to exchanges like Binance, who sometimes handle $9 billion in trades per day. To get an idea of how the payouts will change, the estimated yearly earnings for 100 KCS at the minimum 15% revenue share are shown in the table below.
Daily Trading Volume
|Yearly Earnings ($)||% of Initial Investment|
Current KuCoin Volume
As KuCoin continues to grow, the dividends paid out will increase. At Binance-levels of daily volume, you can earn back more than 50% of your initial investment per year. With two years of that, it will be like you received the KCS as a gift investment from your wealthy grandfather. Yes, you will have to wait for KuCoin to reach Binance’s current popularity, but the growth will happen quicker than you think. Binance, for example, was launched only 7 months ago and has already amassed more than 5 million users. The cryptocurrency market is still young too; you can expect many more people to be getting involved in the years to come. That means KuCoin actually has a higher maximum potential than what is shown in the table; you could reach 100% returns or higher depending on how the market grows.
Another thing to consider is that the dividends are paid out in cryptocurrency, not USD. For example, if a user trades some BTC for KCS, then BTC and KCS are collected in trading fees. So each week you will receive various amounts of all of the cryptocurrencies available on KuCoin. This is a good thing, as many of the coins offered on KuCoin are smaller cryptocurrencies that grow rapidly in value after becoming more well known – the $10 of cryptocurrencies you received in dividends today could be worth $100 in a month.
You should also take into account that the price of KCS will likely grow along with KuCoin as more users purchase them. Therefore, it is important to invest sooner rather than later if you want to get the most shares for your money.
KuCoin’s buyback scheme will make your shares more valuable over time
Another benefit KuCoin offers to KCS holders is a buyback and burn scheme. Each quarter, KuCoin spends at least 10% of their profits on KCS and then permanently destroys them. Therefore, the total supply of KuCoin shares will decrease over time, making the ones you hold more valuable. So in addition to the dividends you receive, your portfolio will also increase in value from this almost guaranteed rise in KCS price over time.
How does it work?
KuCoin states in their white paper that the buyback scheme will continue to operate until 100 million KCS have been destroyed. 200 million KCS were initially created, so the supply of KCS will ultimately be halved. Therefore, even if the market cap of KCS wasn’t increasing with the growth of KuCoin, your KCS would at least double in price anyway.
In addition to the buyback program, you can bet that there will be more people like yourself out there who are interested in buying KuCoin shares. As more users join KuCoin, more people will be investing in KCS, naturally driving the price up. This effect has already been seen to have a huge effect. In the four months that Kucoin has been operating, the price of KuCoin Shares has gone from 70 cents to more than $20 – a massive 14x increase. When you consider that KuCoin only has 500,000 users, you can see that KCS could easily reach a value of $100+ when the userbase grows to a few million.
To put it simply, the sooner you can invest in KuCoin shares the better. Firstly, they will provide you with a great source of passive income that will get bigger as KuCoin grows, which is pretty much a certainty due to the variety of more obscure cryptocurrencies they offer. Secondly, KuCoin’s buyback scheme, along with the ongoing success of the exchange, will ensure that your initial KCS investment will also rise in value over time. When you put these points together, you get an investment that not only shows promising returns, but also pays you while you hold onto it! If you’re new to cryptocurrencies, or just aren’t sure how to buy KCS, follow this guide for buying cryptocurrencies.
When the Kucoin exchange moves from paying holders 50%/50% to 15%/85% rev share, im going to dump and move over to coss.io which is locked in at 50%/50%. COSS also has a much more expansive roadmap with the rev share including merchant payments, payment cards, crowdfunding etc. Its a shame the Kucoin dev team has to get so greedy to take 85% of the fee split allocations. Sure its better than the crud binance and qash offer, but still not not a fair rate IMO.
I am holding KuCoin Shares, but the returns are very low in reality. KuCoin will only reach the volume of Binance if the entire market grows substantially. Anyone using both exchanges will realise that Binance has a much nicer user interface and trading volume. The hype about KuCoin being poised to become the world’s best or largest exchange is hugely exaggerated! The percentage of trading fees is of a very low fee on a very low volume. (I’ve only calculated this based on the KCS increase by KuCoin Bonus. I haven’t figured out the potential gain on the dust of other coins received, but at a glance it is also miniscule.)
Certainly, KuCoin, with its very low fees will remain an option for people to trade on and I hope it enjoys substantial growth, but I am enjoying my Binance coins much more, so far.