Kava 9 is the new update for Kava. The upgrade has had a big impact on v2.0 and with more stability in its approach, will it be able to turn the corner?
The “kava swap coin” is a cryptocurrency that has been in the market for a while. The cryptocurrency is currently valued at 0.0003 USD, and it will be interesting to see if the Kava 9 upgrade will turn the corner after this upgrade.
On December 16, Kava performed a testnet event for Kava 9, which will assess the new main network’s carrying capacity.
Many have been waiting to see how the mainnet update will influence the price of KAVA since the Kava first revealed it a month ago. Previous testnet events caused its price to climb by up to $8.
With a succession of agreements in GameFi, cloud services, security, and other areas, the protocol has been creating interest in the update.
Kava’s ultimate objective is to recruit additional developers to its ecosystem, which has proven difficult for the cross-chain lending protocol, whose TVL is primarily made up of its own projects.
Will the update be enough to rekindle interest in Kava, which has been waning recently?
Kava’s Brief History
Kava had a fantastic start in 2019, receiving Binance Launchpad Project of the Year for its potential to disrupt the blockchain industry.
Kava sprang to prominence as the first significant platform to enable cross-chain lending, while other DeFi apps are restricted to a single chain environment.
The depositing and lending of cross-chain assets is supported by both the Kava protocol and its lending platform, the HARD protocol. The Kava ecosystem now enables investors to lend, borrow, and deposit cross-chain assets.
Kava has been a decentralized Layer 1 hub enabling cross-chain DeFi apps and services since 2019, offering developers with a persistent and accessible financial services infrastructure.
Kava TVL Footprint Analytics
Milestones to watch for:
- On June 11, 2020, the Kava 3 mainnet was upgraded, and the first cross-chain lending platform CDP, which supports BNB staking and USDX drawing, became online.
- The Kava 4 gateway mainnet update was finished on October 15, 2020, and the HARD Protocol cross-chain cryptocurrency marketplace was online.
- The Kava 5 mainnet went live on April 9, 2021.
- The Kava DeFi platform completed the upgrading of the Kava 8 mainnet on August 30, 2021.
- In the first quarter of 2022, the Kava 9 major network upgrade is planned to become active.
Kava TVL increased steadily with each significant iteration and update, bringing up its token price with it, as we can see from the rise of TVL. Its token price, on the other hand, has not followed the same constant increasing trajectory as its TVL. Since the previous iteration, the price of the KAVA token has decreased approximately 60% from its high.
KAVA Price – Footprint Analytics
When we examine Kava’s ecosystem protocols and token economy more closely, the reasons become evident.
The Kava Ecosystem
Kava has two major drawbacks:
- A shaky environment kept together mostly by Kava’s own set of conventions
- A token economy that is insecure
With TVL enabled by Kava protocols, there is a lack of ecosystem breadth.
Kava presently has three major projects:
- Kava Mint, which lets users to get USDX by using their assets as collateral.
- Kava Lend is a cryptocurrency lending platform that enables users to earn incentives by lending and borrowing assets from the cryptocurrency market.
- Users may buy and sell tokens on the Kava chain and receive incentives by providing liquidity to the mining pool via Kava Swap.
Kava Ecosystem Project TVL Footprint Analytics
Kava Mint accounts for roughly 70% of the entire TVL of Kava.
There are a limited number of assets and trading pairs available for loan in the project, as well as a lack of liquidity in the ecosystem, which is only focused on lending and exchanging inside the Kava ecosystem. Kava Swap, for example, has a very high APY but only allows USDX base trade pairings in its liquidity pool.
Tokens of Kava
This year, the price of tokens in the Kava ecosystem has been significantly shifting.
Take a look at Kava’s USDX stablecoin and KAVA governance token.
USDX has a limited number of application situations.
USDX is a stablecoin that has been notoriously volatile, owing to a scarcity of use cases. Its principal application at the moment is pledging on Kava Lending.
After the debut of the cross-chain AMM application Kava Swap, the price of USDX has steadied. Kava also intends to list on other exchanges in order to enhance its liquidity and use possibilities.
Stablecoin USDX Price Footprint Analytics
The allotment of governance tokens entails the danger of a sell-off.
The Kava blockchain is governed by the KAVA token, which also serves as the system’s lender of last resort. If the system’s collateral is insufficient, KAVA is coined to purchase back USDX until the system achieves a sufficient level of collateral once again.
The distribution of KAVA is contentious. 40% of KAVA was sold in three significant private deals, concentrating the company in a few hands.
KAVA Token Distribution – Kava
Will Kava 9 be able to solve these issues?
One of the most exciting features of the impending Kava 9 version is that it will enable the Inter-Blockchain Communication Protocol (IBC), which lets blockchains to communicate with one another. There will be two primary effects as a result of this:
- More inclusivity: Into the upgrading, all IBC-supported initiatives and communities will be able to link their goods with the Kava chain. In the Kava cross-chain DeFi ecosystem, DeFi projects will have access to a variety of functional situations.
- More application scenarios: Because of IBC’s cross-chain structure, USDX may be utilized in Ether DeFi projects through IBC and become the decentralized exchange’s settlement unit. As a result, Kava’s token economy should become more stable.
The Kava 9 update also includes the completion of the Ethereum cross-chain bridge, the Kava Launchpad, Keplr wallet support, and other infrastructure, all of which will help the Kava ecosystem develop in the next years.
While Kava’s cross-chain solution for DeFi financing was a success, the Kava family’s initiatives are insufficient to support a public chain.
The viability of Kava’s ecosystem will therefore be determined by whether the latest update is successful in persuading developers to install projects on the protocol.
Footprint Analytics is the source of this report.
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The “kava swap token price” is the price of KAVA. The company released a new update, but it is not clear whether or not they will turn the corner after the upgrade.
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