Kava Network
Last updated
Last updated
The Kava Network is a general-purpose network that combines two co-chains - Cosmos co-chain and Ethereum co-chain, and uses the Tendermint Core consensus engine.
The Cosmos co-chain is a blockchain based on the Cosmos SDK and connected to most other blockchains in the Cosmos ecosystem. Kava became a full-fledged Cosmos-based blockchain with the launch of Kava Mainnet 9, the main upgrade of which was the implementation of IBC protocol. Thus, the transfer of $KAVA native token to other IBC-compatible blockchains was enabled, as well as the transfer of the IBC tokens to Kava.
The Ethereum co-chain – the EVM-compatible chain for smart-contracts and dApps deploying, written on Solidity.
The Ethereum co-chain was launched in May 2022 along with the Kava 10 mainnet upgrade. At the moment, users are able to wrap and unwrap the $KAVA token through Metamask. In fact, all the basic functionality of this co-chain will be implemented in the upcoming upgrades after the Ethereum Bridge launch.
Both co-chains are connected by the Translator Module, which will make it possible to interact with each other without any limitations.
The Kava Network will be governed by KavaDAO. The security will be ensured by the $KAVA token staking, while stakers and validators will be able to participate in DAO votings and submit their own proposals regarding the network.
The platform allows users to borrow USDX (the Kava's native stablecoin) using crypto assets as collateral. The over-collateralized ratio should be at least 150%. (That means to borrow $100 you must provide a collateral of at least $150).
The platform functioning is based on three main modules:
CDP (collateral debt position) – the Cosmos SDK module, which allows the implementation of collateral debt position creating
Auction – the module ensures the stable network operation and USDX peg
Price Feed Module – track the price using the Chainlink oracle
BEP-3 Module – act as a secure bridge between Kava and Binance Chain
The algorithm of Kava Mint's work is shown below:
More details on liquidations on Kava Mint and Kava Lend can be found here.
Kava Lend is the lending platform with the native governance token called $HARD.
With Kava Lend users can:
- Supply liquidity and receive a percentage of the provided amount (the percentage depends on the asset type)
- Borrow assets using other assets as collateral
- Both suppliers and users receive rewards in the $HARD tokens
$HARD holders are able to participate in governance and submit their own proposals regarding the network
Kava Swap is a standard AMM Swap with the native token called $SWP. Users can provide their tokens to liquidity pools and receive $SWP as an additional reward for liquidity providing.
Additionally, $SWP holders can participate in governance and submit their own proposals regarding the network's development.
Kava Earn is a platform that allows users to apply combined strategies just in a couple of clicks, and thereby make the maximum (depending on the risk) profit. In other words, Kava Earn combines the functionality of Kava Mint, Kava Lend, and Kava Swap and provides users pre-made strategies.
In general, the goal of Kava Earn is to provide secure strategies with high yield.
At the time of writing (the mid-July 2022), only the BUSD Kava Earn strategy was implemented on Kava Earn. Learn more here.
- Ethereum Bridge Launch The bridge will enable the transfer of the ERC-20 tokens and ETH from the EMV-compatible chains to Kava Network and vice versa
- Liquid Staking, which will allow the $KAVA stakers to more effectively use their assets
- Earn Yield Optimizer. Will allow users to automatically optimize yields by supplying assets to the highest yield generating protocol
- The ability to interact with Kava and sign Cosmos SDK transactions through MetaMask. Users will be able to sign SDK transactions for Ethereum assets in a single Metamask Wallet.
- New Loyalty and Referrals Rewards programs
- Kava Foundation launch. Kava Foundation is a non-profit advisory body of industry leaders that provide strategic input to the Kava DAO and its community
- Kava Network GameFi and NFT Incentive Program
- BNB Chain Bridge Launch
- CosmWasm Support, which will allow the rapid and more convenient deployment of smart contract dApps to the Cosmos co-chain, bringing developers from across the Cosmos to the Kava Network
- BTC Native Bridge launch, allowing the transfer of BTC
Integration with Multichain (formerly Anyswap), enabled the transfer of 5 ERC-20 tokens (USDC, USDT, DAI, ETH, WBTC) between the Kava Network and other 8 chains. Details here.
Partnership with Celer, enabled cBridge support. Thus, now users can bridge USDC, USDT, WETH, DAI, and WBTC between Ethereum and Kava. Details here.
Partnership with Sushi. More details here.
Integration with Nervos. After the launch of the Ethereum Bridge this integration will enable bridging between the Kava Network and Nerovs. In the future Kava may explore adding $CKB to the Kava Mint or Kava Lend protocols as well.
It is important to note that Kava is a young, but very ambitious network, as evidenced by its active work on partnerships and the attraction of new Cosmos-based projects, as well as new users (e.g. Kava Pioneer Program, under which the team announced the partnerships with projects such as AutoFarm, Beefy Finance, and Ren. Also, recently Kava launched the 750 million dollars financing program for developers).
Messari on Kava Network (the article is old, but there is a good explanation of Kava, the liquidation mechanisms and USDX)
