Kava (KAVA)

1. What is Kava (KAVA)?

The Kava Network is a Layer-1 blockchain that combine the speed and scalability of the Cosmos SDK with the developer support of Ethereum.

The Kava Network will empower developers to build for next-gen blockchain technologies through its unique co-chain architecture.

Specifically, the Kava Network enables:

• Seamless interoperability: The Ethereum and Cosmos Co-Chains interoperate seamlessly with each other, empowering developers to build in whichever environment they want without sacrificing access to the users and assets of the other.
• Optimized scalability: The Kava Network's unique architecture enables the free flow of users, assets, and projects between Kava and the industry's most relevant ecosystems at scale, all powered by the lightning-fast Tendermint Core consensus engine.
• Rapid ecosystem growth: Innovative and transparent on-chain incentive programs ensure that the best builders in the Ethereum and cosmos ecosystems are properly rewarded for driving growth for the Kava Network.

The KAVA token is integral to the security, governance, and mechanical functions of the platform. There are four main use cases for the KAVA token:

1. Security: The top 100 nodes validate blocks by a weighted bonded stake in KAVA tokens. Economic incentives for validators come in the form of earning KAVA as block rewards and as a portion of the network's transaction fees. Validators risk losing KAVA via strict slashing conditions such as failing to ensure high uptime and double signing transactions.
2. Governance: KAVA is used for proposals and voting on critical parameters of the Kava Network. This includes but is not limited to the types of supported assets and Dapps, their debt limits, and acceptable assets to use as debt collateral, collateral ratio, fees, and the savings rate for various financial instruments introduced to the network. The KAVA token is also used to vote in proposals that would affect the Kava Network SAFU Fund and treasury allocation, such as reward payouts for incentives programs.
3. Incentives: A portion of KAVA emissions is distributed as incentives for scaling the network. These incentives go directly to top projects on each chain to drive growth, encourage competition, and improve the health of the Kava ecosystem.

2. Products and key features

2.1 Co-Chain Architecture

The most important feature of the Kava Network is its co-chain architecture, enabling developers to build and deploy their projects using either the EVM or Cosmos SDK execution environments with seamless interoperability between the two. The following diagram shows how the system will function once the Kava 10 upgrade is complete and the Kava Network mainnet goes live.

More information about Kava 10 (Kava Network 1.0) can be found here.

The co-chains of the Kava Network operate like the two hemispheres of a brain. The Cosmos Co-Chain is optimized for Cosmos ecosystem developers. The Ethereum Co-Chain is optimized for Ethereum ecosystem developers. The Translator Module connects the two distinct execution environments of the Co-Chains, allowing them to work seamlessly together at scale. This packages the industry's two most used execution environments within a single network. Ethereum meets Cosmos via the Kava Network's robust, developer-optimized Layer-1 architecture.

The Ethereum Co-Chain - An EVM-compatible execution environment that empowers Solidity developers and their dApps to benefit from the scalability and security of the Kava Network.

The Cosmos Co-Chain - The Cosmos co-chain is a highly-scalable and secure Cosmos SDK blockchain that connects Kava to the 35+ chains and $60B+ of the Cosmos ecosystem via the IBC protocol.

2.2 Cosmos SDK and Tendermint Core

Kava is built using Cosmos-SDK, an open-source framework for building public Proof-of-Stake blockchains. Core features of Cosmos-SDK include:

• Tendermint Core consensus engine: Kava relies on a Byzantine Fault Tolerant consensus engine designed to support Proof-of-Stake systems.
• Cosmos modularity: as new open-source modules are developed for the Cosmos ecosystem, Kava can quickly implement desirable modules. For instance, the Inter Blockchain Communication (IBC) (from Cosmos) module enables all Cosmos-SDK blockchains to communicate. Kava Network integrated with the IBC at 16:00 UTC on January 19, 2022.

The following table shows the performance benchmarks of Tendermint Core.

2.3 On-Chain Incentives

The Kava Network features an innovative approach to developer incentivization. Through an open and transparent mechanism, a portion of KAVA emissions are directly awarded to protocols to incentivize usage and drive growth for the Kava ecosystem.

Following the Kava 10 upgrade and Kava Network mainnet launch, the incentive module will distribute KAVA emissions between both chains, with the top 100 protocols on the Ethereum Co-Chain sharing a pro-rata distribution of incentives based on usage metrics and TVL.

2.4 The KavaDAO

The Kava DAO is a fully decentralized autonomous organization (DAO) that governs the Kava Network. Made up of the Kava stakers and validators that help to secure and run the network, the DAO operates on a liquid democracy model and determines how the network functions, what changes should be made to it, and most importantly - how the unique on-chain developer incentives are distributed between the two chains.

As a truly decentralized organization, the Kava DAO has no headquarters, no directive, and no leadership. Contributors to the security and stability of the Kava Network are also tasked with providing direction. The DAO self-governs maintains its standards in line with the expectations of the Kava community. This ensures that the Kava Network always serves users' interests and the people who build on it.

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