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– TIMESTAMPS –
1:55 What is Kava?
4:30 Supported Assets & Earring High Yield
6:00 Why Use Over Collateralized Loans?
7:35 The Tech
10:29 The Kava Token
18:02 Final Thoughts
⛓️ 🔗 Useful Links 🔗 ⛓️
► Kava Site: https://www.kava.io
► Kava Binance Research Report: https://research.binance.com/en/projects/kava
► Whitepaper: https://docsend.com/view/gwbwpc3
► USDX Minting Rewards Explained: https://medium.com/kava-labs/usdx-minting-rewards-explained-82d0b74897a2
► Mintscan: https://kava.mintscan.io/validators
► Staking Rewards: https://www.stakingrewards.com
📝 What is Kava? 📝
Kava is a cross-chain DeFi platform which offers stablecoins and lending services to the holders of major cryptocurrencies. In a nutshell, Kava is all about opening up access to liquidity for various cryptocurrencies and doing that in a decentralized way.
Yes, Maker and Compound do a similar sort of thing on Ethereum. However, Kava is looking to extend that DeFi goodness to non-ERC-20/ETH assets and bring that to other blockchains.
💧 How To Get That Liquidity? 💧
Simply send your crypto collateral to Kava’s platform. It will then be escrowed in a smart contract and USDX stablecoins will be minted and can be used for anything. These are over-collateralized loans.
Liquidations kick in if this ratio hits a ratio of 1.5.
₿ Get Your Crypto Back ₿
To get your collateral back, simply repay the loan in USDX and pay the stability fee to unlock your crypto. Right now, this fee is set at 5% for BNB coin.
🎁 Get Rewards For Minting USDX With BNB 🎁
Supply BNB collateral on Kava and get your share of 74,000 Kava tokens every week!
💸 Reasons To Use Over Collateralized Loans 💸
The idea of supplying $100 in crypto and getting $50 back is a head scratcher for many. However, the reason why so many use them in DeFi is to gain access to margin and use that to buy more crypto. That’s the main use case here.
Other advantages of these loans include the fact that you don’t need to KYC or undergo any credit checks. It’s fast and simple.
🖥️ The Tech 🖥️
Kava is built using the Cosmos-SDK, which is an open source framework for building public proof-of-stake blockchains. This means that Kava uses the Tendermint core consensus engine; this is a Byzantine Fault Tolerant engine that’s designed to support PoS systems. It is this SDK that makes Kava interoperable.
Using that backbone, Kava has developed hour core modules. These include an auction, price-feed, CDP and liquidator modules. If you want to learn more about that and their significance, then I recommend you watch the video!
💰 Tokens 💰
► Kava is the governance and staking token of the platform.
► USDX is Kava’s synthetic stablecoin.
Currently Kava staking rewards are around 5.5% and USDX has a savings rate of 4.5%.
That brings me onto the big money question: why would you want to get a hold of these tokens?
1️⃣ Kava 1️⃣
► It’s a bit like owning shares in a decentralized bank that sets interest rates and controls the money being printed off the back of all those crypto reserve assets.
► You can vote for ideas you want to see on Kava. So, you might love the idea of being able to put up crypto collateral and minting a token soft pegged to the price of gold.
► There is a massive incentive to stake. If you do not, you are essentially being inflated away. That shrinks down the tradable supply and means that less buying pressure is needed to increase the price.
► When someone pays back a loan, they do so in Kava. Once that’s paid, the Kava is then burnt. So this is actually a deflationary mechanism.
If you want to hear my other thoughts on this token, then be sure to check out the video!
2️⃣ USDX 2️⃣
► Be aware that the ticker symbol USDX on Coinmarketcap is NOT Kava’s stable coin.
► With USDX you can see the collateral backing the coin on the blockchain.
► Unlike some of the other stablecoins, Kava is decentralized. That means that a government cannot shut it down.
► The coin has a pretty respectable savings rate of 4.5%.
📜 Disclaimer 📜
The information contained herein is for informational purposes only. Nothing herein shall be construed to be financial legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading Forex, cryptocurrencies and CFDs poses considerable risk of loss. The speaker does not guarantee any particular outcome.
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