Key Info: (July 15, 2022)
- Circulating Provide — 227,322,667 KAVA
- Complete Provide — 232,291,416 KAVA
- Sector — DeFi lending
- Token Kind — Native token
- Token Utilization — Staking and governance
- Consensus Algorithm — Proof of Stake (PoS)
- Launch Date — October 2019
- All-Time Excessive — $9.19
- All-Time Excessive Date — September 9, 2021
What’s Kava (KAVA)?
Kava (KAVA) is a DeFi software program that permits customers to lend or borrow a number of cryptocurrencies with out middlemen resembling banks, monetary establishments, or different third events. Growing demand for DeFi providers makes KAVA a big undertaking with excellent know-how and a easy use case.
Being decentralized, Kava is among the many most outstanding tasks within the DeFi sector. Versus quite a few comparable protocols and DeFi platforms, Kava isn’t constructed on the Ethereum community. As an alternative, it implements Cosmos as a basic platform that backs up the lending protocol. This community was chosen because it depends upon customization and interoperability, giving extra performance to the protocol. Ethereum, however, encounters issues with scaling dApps and hosted protocols if community congestion occurs.
The Kava system employs Cosmos so as to mint a stablecoin known as USDX that’s pinned to the U.S. Greenback. Each time a consumer deposits a cryptocurrency as collateral, USDX is made so different customers are in a position to take loans within the form of USDX. Those that deposit their funds again to the lending system are given KAVA cash each week as a reward for his or her participation.
Kava merges with different protocols and platforms by way of app-specific blockchain known as zones, that are hosted on Cosmos. This manner, customers are in a position so as to add a number of tokens to the Kava protocol that can be utilized for lending or borrowing.
A short historical past of Kava
Kava was designed in 2018 by Kava Labs, a worthwhile basis co-founded by Scott Stuart, Brian Kerr, and Ruaridh O’Donnell. The group threw a public sale for six.5% of the whole provide of KAVA, having raised about $3 million.
In August 2020, the Kava protocol was formally launched on the Cosmos platform, granting BNB as collateral for USDX loans. Ever since, Kava has documented greater than $8 million price of USDX loans, in addition to round $24 million in BNB locked as collateral.
What makes Kava distinctive?
Kava isn’t a single lending protocol within the DeFi sector. Nonetheless, its uniqueness is because of cross-chain operations and interoperability simplified by way of the Cosmos community on which the protocol is hosted. Owing to zones, a characteristic of Cosmos, Kava lending protocol customers are in a position to deposit an intensive vary of non-native cryptocurrencies like bitcoin (BTC), BNB, Ethereum (ETH), and different cryptocurrencies.
One other characteristic that makes KAVA distinctive is enabling customers to reap a share yield on the idea of the system by which new USDX is minted. Customers are in a position to earn curiosity whereas Kava secures crypto they’ve deposited. Additionally, these deposited funds contribute to the Kava market known as HARD Protocol.
What provides KAVA worth?
The worth of Kava is established by the soundness and relevance of its use case, basic use, know-how, and technical capability. The elemental worth of Kava straight relies on its know-how and repair.
Since KAVA’s value is straight impacted by the volatility of the crypto market, it will probably oscillate significantly inside brief intervals of time. The value may be influenced by the event group, updates and upgrades, new options, mergers and partnerships. Within the case of KAVA, the value may be additionally affected by including backup for extra cryptocurrencies.
What number of KAVA are in circulation?
On the time of writing, there are 227,322,667 KAVA cash in circulation. The whole variety of KAVA isn’t capped so as to pay for staking rewards. For that purpose, KAVA is alleged to be an inflationary cryptocurrency, which means that its provide grows with time.
The annual inflation fee varies from the underside of three%, when a variety of KAVA are staked, to the highest fee of 20% when a small variety of cash are staked.
What’s KAVA used for?
KAVA is the native token of the platform with a twin goal. It’s carried out as a governance token for voting on the community and for staking. Thus, KAVA holders personal the Kava protocol, along with voting rights on the system. Expectedly, their voting energy relies on the variety of KAVA cash they possess.
The holders even have an opportunity to own their very own staking nodes; nevertheless, solely 100 nodes are in a position to reap rewards as validators straight from the protocol.
Being an inflationary token, KAVA’s whole provide is limitless. Nonetheless, the system regulates it by the occasional burning of KAVA.
How does Kava work?
The Kava lending protocol relies on the efficiency of the good contract employed by the protocol to make a P2P lending system less complicated. Customers are in a position to lock their funds in good contracts. Because of this, new USDX tokens are minted, which may be additional used for collateral loans.
Subsequent, a particular good contract is routinely created. It pins the worth of USDX to that of the U.S. Greenback to compensate for volatility typical for the crypto market. This is named a collateralized debt place (CDP).
Customers have the chance to create CDPs by depositing crypto into good contracts by implementing digital wallets which may be linked with the system. As quickly because the funds are deposited, Kava will instantly lock them in a sensible contract. New USDX stablecoins are then minted on the idea of the deposited funds, permitting customers to take out loans in USDX.
To finish the CDP and reclaim the collateralized token, customers should pay their debt again together with a lending charge. When the CDP is finalized, the unique collateral is deposited again to the consumer’s pockets and Kava “burns”, that’s, destroys the lent USDX.
With the intention to shield the protocol from crypto volatility, the Kava system leans on the collateralization ratio. This manner, it additionally makes positive that USDX is over-collateralized to battle the devaluation of the collateral.
What know-how does Kava use?
Kava is constructed across the Cosmos SDK, which is a modular blockchain improvement framework. It implements the Tendermint-based proof of stake (PoS) consensus mechanism that gives Byzantine Fault Tolerance, security, safety, and quick finality.
Kava’s PoS consensus mechanism employs a community of validator nodes to verify transactions. These nodes have to supply collateral to begin validating transactions. In case a validator misbehaves or doesn’t handle to satisfy strict minimal necessities, their stake shall be punished. This manner, validators are motivated to remain trustworthy and environment friendly.
KAVA holders are in a position to run a staking node straight from the protocol and thus reap staking rewards. Solely validators (the highest 100 nodes) can earn these rewards. Different KAVA holders are in a position to stake their cash on numerous platforms, CEX.IO being one in every of them.
The platform’s good contracts have been checked and audited by a number of unbiased crypto and blockchain safety corporations. No vulnerabilities have been found updated.
The Kava DAO is a decentralized autonomous group (DAO) controlling the Kava community. KAVA validators and stakers assist safe and run the community. Thus, they’re answerable for proposing and voting on proposals concerning the community.
The Kava community undoubtedly presents high-quality lending providers, nevertheless, it isn’t the one crypto lending platform. These are a few of Kava’s essential rivals.
mStable is an open-source decentralized protocol that merges stablecoins, lending, and swapping right into a single normal. With its autonomous and non-custodial stablecoin infrastructure, mStable blends lending income with buying and selling charges to give you larger yield property. The protocol is managed by MTA holders who stake their cash so as to vote on proposals.
Yearn Finance is a sequence of DeFi merchandise that gives lending aggregation, yield era, and insurance coverage on the Ethereum community. The protocol is managed by completely different unbiased builders and managed by YFI holders. The preliminary Yearn product was a lending aggregator. Customers are in a position to deposit to loans aggregator good contracts by means of the Earn web page.
SushiSwap is a decentralized crypto alternate platform that permits customers to swap, stack yields, earn, lend, and borrow on a single community-driven platform. Sushi holders can participate in neighborhood governance and stake their tokens to get part of SushiSwap transaction charges.
The place to study KAVA
To study extra concerning the Kava community, you possibly can go to:
Kava sticks to maintaining its customers updated with all important occasions. These are among the newest updates:
- Kava Rise implementation — Kava Rise is a $750 million motivation program created to maintain onboarding probably the most modern builders.
- Kava Earn introduction — Kava Earn was created with the goal of simplifying complicated DeFi options.
- Kava 10 mainnet launch introduces Kava’s EVM, an enormous development of Kava’s Ethereum and Cosmos co-chains, connecting two giant ecosystems in a single community.
To expertise KAVA, purchase or deposit it on the CEX.IO net or cellular platform.