Kava aims to be a DeFi lending platform for a wide range of crypto assets. The platform will also provide access to leverage. It will have a stablecoin, called USDX. The value proposition is that holders of USDX can bond their stablecoin with a yield. This provides hedging and the ability to earn interest as well.
As blocks production needs staking, Kava token provides security. It is a governance token like Maker, it will be used to govern the stability fee of the network. It also serves as the lender of last resort.
How it Works:
We believe that there is a novelty in the project as it expands the scope of collateral to assets like BTC and XRP. That said, there are causes for concern from the fundamental analysis perspective -
- The mainnet will only be launched in Q4 2019.
- The Telegram group still has a message pinned for October 2018. It means that the updates are not regular from the team
- Documentation is not extensive. Though the use cases are explained, how exactly it will happen, how the network interacts with Cosmos network and so on is not known
- 30% of the total tokens were allocated to private sale investors at an 83% discount compared to the IEO price. IEO comprise only 6.5% of the total number of tokens.
- The team does not possess the requisite experience in our view
Kava is a Collateralized Debt Position ("CDP") system implementing Interledger Protocol (ILP) to stream value between multiple crypto-assets i.e cross-chain assets, for example, XRP and ETH on mainnet.
KAVA blockchain implements the Tendermint PoS protocol from Cosmos-SDK and will be run by known validators, taking a consensus from the top 100 validators depending on the stake sizes. KAVA blockchain means block time is 1-3 seconds and using the 33% BFT consensus percentage. They will be able to take BTC as Collateral which is MASSIVE in DEFI world!
Kava team has few solid developers and super active in terms of development achieving their Roadmap.
They scored 100% in Code Quality and a Team of Developers.
We think that a 6-10% percentage of crypto users will use the KAVA platform based on 500M+ DAI that has been locked in the Lending smart contracts. When Kava will open BTC/XRP/BNB, a massive community is expected to join them.
They are lacking mainly in Innovation and Architecture for two reasons but with a solid working product, these can be trivial!
1. No comprehensive whitepaper
2. No technical paper explaining the clear architecture
Kava testnet is available here - https://kava-testnet-2000.mintscan.io