Kava Cryptocurrencies is native to the Kava.io platform, a decentralized financial protocol that allows users to lend and borrow assets using multiple encrypted assets as collateral. As a blockchain-based platform, Kava.io does not need intermediaries to complete this process. Instead, it chooses a cross-lending platform that allows users to borrow USDX Stable Coin against decentralized financial assets (DeFi) such as Bitcoin (BTC) and XRP (XRP). In addition, users can deposit supported cryptographic assets and earn profits.
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What is Kava (KAVA)?
Kava Network was founded in 2018 by Kava Labs, a company that focuses on easy access to financial services for all. On November 14, 2019, the main Kava network was launched. The KAVA blockchain acts like a decentralized bank. According to WhitePaper, this is the first DeFi platform that allows users to borrow and lend major cryptographic assets without the need for a traditional financial intermediary. This digital currency supports a number of digital currencies including Bitcoin (BTC), Ripple (XPR), Binance (BNB), and Cosmos (ATOM).
Many DeFi platforms support the Ethereum network. Kava is the first company to be built at Cosmos, which, according to its creators, allows Kava to operate “Lightning Fast” – the platform’s most important selling point.
The network supports Co-Chain architecture, which combines the flexibility and speed of the Ethereum blockchain with the interoperability of the Cosmos SDK, and integrates two unlicensed high-consumption ecosystems into a single, scalable network. This allows users to access the most popular blockchain and establish a free flow of assets and projects in the Kava ecosystem.
This platform has three functions:
Allows users to earn rewards by securing and borrowing assets from money markets.
Allows users to buy and sell assets across the Kava blockchain and receive rewards by offering cash pools.
Allows users to use their encrypted assets as collateral to receive fixed dollar coins called USDX loans.
StableCoin, backed by Kava cryptography, can be extracted by anyone with encrypted assets. To cut the USDX, the user must deposit more encrypted assets at the value of the USD than what the USDX wants to create. Different crypto assets have different collateral quotas.
Users will receive prizes that can be used for governance and stocks to multiply USDX in the form of KAVA’s native digital currency, the KAVA token. The number of rewards an owner receives in KAVA varies depending on the type of cryptographic assets they own.
How does Kava work?
Network users can pledge their cryptographic assets in exchange for USDX. USDX acts as a stable coin on the network. To get a USDX loan, users only need to lock their cryptography in a smart contract on the platform. This locked digital currency acts as collateral against your loan.
Users may take out several collateral loans to create artificial leverage for any cryptographic assets supported in the system. For example, you can choose to lock your Bitcoin or XRP using the protocol. To buy more bitcoins, you will receive the equivalent of the newly extracted USDX. This way you get leverage in the market.
Kava also includes a wide range of community-built applications. Each of these DApps adds to the overall UX of the platform. This interoperability allows you to store your assets using a variety of hardware wallets and first-class corporate custodians. This flexibility is one of Kava’s main attractions in the face of competition.
Decentralized lending and leverage
The main product of the Kava platform is decentralized loans. All Kava users have free access to loans, leverage, and stable coins to cover risk. In this way, Kava acts as a powerful tool for market investors.
Coin Stable Coverage + Profit
Another unique feature of Kava is its stable coin capabilities. To start earning a healthy passive income, you can stock StocksCoin USDX stocks and bonds.
Kava has a unique open architecture that enables future growth. The platform will support a wide range of digital currency assets and offerings in the coming months. These synthetic products and new derivatives will take the acceptance of kava to new heights.
KAVA is the main token of this blockchain. This coin acts as a symbol of sovereignty in the ecosystem. Users need these tokens to vote on critical parameters. These votes are what drive network upgrades. They are also used for suggestions and voting on specific parameters of the Collateral Debt System (CDP).
This crypto also plays an important role in maintaining network security. KAVA users share to do this task. It is worth noting that only the top 100 network nodes approve blocks in this system. Holders of high tokens are determined using an algorithm that examines each user’s weight share in KAVA tokens. For their efforts, shareholders receive digital currency as a block reward.
Shareholders in the network also have several responsibilities. Aside from blockchain security, these users can share their assets using network credential link curves. Malicious nodes can lose their Kava. Actions such as high time uncertainty and double transaction signatures will surely remove you from the network. Kava is known for its intolerance to destructive nodes.
The latest lender solution
KAVA can also act as a backup currency for the network. If USDX becomes too collateral, it creates a new KAVA network to use in buying USDX. This allows Kava to make sure that Stable coin retains its value.
The team behind Kava
Kava Labs, Inc., the parent company behind Kava, was founded by Brian Kerr, Ruaridh O’Donnell and Scott Stuart.
Brian Kerr is the current CEO of the platform and has previously worked as a consultant for several blockchain and crypto platforms, including Snowball and DMarket. Kerr has a diverse and successful career and has studied business management.
Ruaridh O’Donnell, a graduate of Master of Physics, is listed as the second Kava founder and former data engineer and analyst at Levelworks. Kava co-founder Scott Stewart is a former professional poker player who now works as a product manager at Kava Labs.
Kava Labs also lists dozens of other employees and contractors, most notably Denali Marsh – an intelligent contract developer and experienced auditor who plays Blockchain Engineer at Kava.
What makes Kava unique?
Kava distinguishes itself from other similar decentralized lending platforms because of its support of distinct chain assets.
Thanks to Cosmos area technology, Kava users can deposit a wide range of indigenous assets, including Bitcoin (BTC), XRP, Binance Coin (BNB) and Binance USD (BUSD). But for now, cross-chain assets must be packaged as Binance Chain Assets (BEP2).
Likewise, Kava also allows users to earn returns by multiplying their fixed USDX coins. Once multiplied, these USDX tokens can help Kava’s money market, known as the HARD protocol, and the user obtains a variable APY while their collateral is maintained by Kava.
Kava users can run their stock nodes to receive KAVA rewards directly from the protocol. However, only the top 100 Kava nodes (also known as validations) are eligible to receive these awards. Beyond that, KAVA holders can place their tokens on a variety of compatible exchange platforms such as Binance and Huobi Pool.
Beyond that, users can earn regular KAVA prizes by cutting USDX on the platform. The system also uses various mechanisms to burn KAVA tokens that help reduce circulating supply.
Kava enables easy and seamless lending based on the many types of cryptocurrencies supported by the protocol. Users can enjoy cross-chain lending using a simple and user-friendly collateral system.
Users can earn an APY based on their stakes, and can also earn interest based on the funds they have for loans. In a decentralized system that values the opportunity to borrow and lend crypto, users can easily access a multi-currency lending platform.