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Smart Contract, Private Blockchain, Infrastructure

Kadena

Kadena is developing the next generation of public and private blockchain platforms for enterprise with a own smart contract language - Pact. Pact is the first human-readable smart contract language. Kadena use their own consensus mechanism – Chainweb is a Proof-of-Work Parallel-Chain Architecture for Massive Throughput.

Rating: 3.6

Official contacts
Location: Brooklyn, New York
Web-resources:   Whitepaper Website
Social networks:
Product source tracking: https://github.com/kadena-io/
Details Description Risks Full analysis Team

Detailed review

Stage of product development
The company was founded in June 2016. Now the 2.4 version of their programming language – Pact – has been announced.
Roadmap
July, 2018
Accredited Investor Private Sale begins, Testnet release mid Q2.
October, 2018
Testnet hard fork.
December, 2018
Mainnet release Main ICO is expected in the end of Q3 or Q4 2018.
Token description
ICO date
15.10.2018 - 15.12.2018
Token price
N/A
Platform
N/A
Blockchain
Own
Token distribution date
N/A
Consensus method
Chainweb - Proof-of-Work Parallel-Chain Architecture
Escrow
N/A
ICO currencies
Bounty camping
N/A
Markets
N/A
Token functions
Cryptocurrency in public chain of Kadena.
Risks
MARKET

• No clear focus of the project.
• High competition on the public blockchain market.

PRODUCT
BUSINESS MODEL

• The rise of the platform will not lead to rising of the token price.

FINANCES

• Next level of funding could be too expensive.

• Equity investment would be highly preferable, but it is not available.

TEAM
Full analysis
Market

There is no clear market for Kadena. Potentially, most large corporations and medium companies could implement blockchain solutions to their operations. As a result, total available market for Kadena blockchain is hundreds of billion dollar, but serviceable obtainable market is extremely hard to estimate nowadays. Due to implementing different blockchain solution, interoperability between different blockchain would be the biggest issue in near future. The opportunity to create thousands of chains on Kadena’s blockchain is a strong side of project. \nThe competition in all kind of scaling solutions in public blockchain is fierce. Ethereum EOS, NEO, Tezos, Dfinity, and many other strong competitors. Kadena currently has not enough power and resources to compete for the leading position on this market. Primary competitors in private chain side are Cardano, Hyperledger and NEM. \nNew human-readable language is great competitor advantage on the one hand, on the other hand, it creates additional barriers for wide adoption of Kadena.

Product

There are 3 products of Kadena:

1. Pact Smart Contract Language

Pact is the first human-readable smart contract language. With Pact, humans write logic directly onto a blockchain. Pact is immutable, deterministic, and Turing-incomplete, fighting bugs and exploits. Pact strikes a balance between low-level directly executable expressions and high-level declarative code. With Pact escrows and cross-chain transfers are easy to write.

2. Public blockchain – Chainweb – parallel-chain protocol

Kadena is creating a public blockchain using a new consensus mechanism called Chainweb which offers a scaling solution for a Proof of Work, it is a Proof-of-Work Parallel-Chain Architecture for Massive Throughput. Chainweb, is a “layer 1” scaling solution capable of handling 10,000 TPS. Kadena’s solution gives every chain the primary chain functions, thus not a side-chain approach to solving scalability. Every single chain will produce Kadena’s tokens, and Chainweb’s protocol will ensure that the same coin cannot exist on two chains at the same time. Chainweb will use a Simple Payment Verification (SPV) to delete coins that are sent to another chain before being created on the receiving chain.\n Chainweb's incredible attack resistance means faster mining, encourages decentralization, and reduces confirmation times to sub-minute.

3. Enterprise blockchain – private blockchain

Kadena's proprietary BFT-consensus protocol ScalableBFT achieves up to 8,000 TPS with latencies well below 100ms in real-world testing with 256 nodes. Kadena is the first private blockchain that can scale to thousands of nodes.

Kadena is a product of further development of the Raft consensus algorithm. The Raft consensus mechanism was followed by Tangaroa (A Byzantine Fault Tolerant (BFT) Raft) and the JP Morgan project Juno (A fork of Tangaroa), neither of which are longer under active development. Kadena is the “next generation Juno.”

Business model

Main purpose of the Kadena blockchain is creating enterprise solutions. The public and private protocols connected by same smart contract language Pact. However, the consensus mechanism are completely different. Public protocol is called chainweb that uses advanced PoW, that’s where the tokens are involved. The private chain is a scalable byzantine fault tolerance (BFT) protocol and doesn’t involve tokens. We believe, that Kadena could find itself mostly at private blockchain market. The tokens are not used there, so as a result, we suppose, that the rise of the platform would not be transferred to rise of token price. The equity investments would be highly preferable in case on Kadena.

Finances

Kadena has not reveal the token metrics yet. Kadena already has had two rounds of SAFT funding this year. First was in January, it has raised $2.25M. Major investors in the private-placement SAFT round included Metastable, Kilowatt Capital, Coinfund, and Multicoin Capital. Second round was in April 2018. Kadena has raised $12M. Investors in the round included Devonshire Investors, SV Angel, Passport, Multicoin Capital, Susquehanna International Group (SIG), and Asimov Ventures. The following round is supposed to be in September. It is really hard to explain, why Kadena needs three round of financing within one year. If we apply the same coefficient between rounds, the hard cap of new round could be up to $60 mln. And that would not be the whole pool of tokens. That is incredible valuation for the project nowadays.\nThe vesting period is also unclear. Initial grants come out of the investor share of the genesis block, which doesn’t have vesting restrictions. Initial team and advisor tokens have between a 1mo-1yr vest and are relatively small. Subsequent grants for the team and advisors will come from the platform share and will vest accordingly – T+0 to T+1yr after launch there is no vest at all, T+2yr to T+5yr after launch the platform share vests linearly on a monthly basis. A lot of tokens has almost no vesting periods. That is really sadly situation for investors.

Team

Kadena has the powerful team with tremendous expertise in implementing technical solutions in large financial institutions. Will Martino – Founder -  was a Lead engineer for Juno, JP Morgan’s blockchain prototype, and was previously Tech Lead for the SEC's Cryptocurrency Steering Committee and the Quantitative Analytics Unit.  Stuart Popejoy – Founder – directed JP Morgan’s Emerging Tech Blockchain group, and has 15 years experience building trading systems and exchange backbones for the financial industry. Monica Quaintance – Head of Engineering – had led database engineering at Rent The Runway and was a quant for the SEC, before which she worked in investment banking for Cushman & Wakefield. Monica has degrees in Statistics and Probability as well as Economics at Columbia University. Marie Leaf - Product Lead – bridges the divide between private and public blockchain development. She vetted leading enterprise platforms for the Chief Architect of Cognizant’s Blockchain Practice and has three years of own independent consulting practice in blockchain area. Doug Beardsley – Senior Engineer – Doug has 15 years of software engineering experience including 8 years using Haskell professionally.  All other team members also have colossal experience in tech and blockchain development. We believe that this team could build an excellent solution for enterprise blockchain adoption.

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