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Infrastructure

Kava

A decentralized fast-finality blockchain for interoperable payment channel networks. Kava Switch is the first cross-currency interface to Interledger which allows users to swap cryptocurrencies in a trust-minimized fashion. Kava allows everyone to swap cryptocurrencies p2p. It based on Kosmos Network SDK and Interledger.

Rating: 3.0

Official contacts
Location: N/A
Web-resources:   Whitepaper Website
Social networks:
Product source tracking: https://github.com/Kava-Labs/kava
Details Description Risks Full analysis Team

Detailed review

Stage of product development
Currently, public test version is not available.


Token description
ICO date
TBA
Token price
N/A
Platform
N/A
Blockchain
Interledger & own
Token distribution date
N/A
Consensus method
PBFT based Proof-of-Stake consensus
Escrow
N/A
ICO currencies
Bounty camping
N/A
Markets
N/A
Token functions
The Kava token provides access to a decentralized set of Kava validators which confirm transactions on the Kava blockchain. The Kava token is also used to pay transaction fees that prevent spamming of the network. The Kava blockchain is a kind of PoS system, as a result, it issues a block reward to validators and indirectly to anyone who has bonded stake to a validator.
Risks
MARKET
  • The very high competition on the decentralized exchange market
PRODUCT
  • The product is on the very early stage of the development
BUSINESS MODEL
  • The platform should have a low commission fee to be attractive for users, as a result, the token price should be low.
FINANCES
  • The project is overvalued.
TEAM
  • Founders do not have relevant experience in the field of the blockchain
Full analysis
Market

Currently, the only one way to change one cryptocurrency to another is using centralized or decentralized exchanges. The trade volume on the exchanges is enormous. In some sense, Kava is a decentralized exchange with better UX. As a result, we could say, that Kava is operating of this market. The great news is that this market is actively growing, the bad news is that the competition on this market is growing even faster. Currently, a consolidation trend is the most actual trend in the centralized exchange's market. In a while, the same trend will appear on the decentralized exchange's market. However, due to better user experience and the same benefits as in decentralized exchanges, Kava could reserve own niche on the market. Even is the field of direct p2p swaps, the solutions already exist. For example, Uniswap, already allow exchanging different cryptocurrencies p2p.

Product

Kava’s blockchain features fast-finality to serve as the decentralized asset for fast settlement of payments. Kava’s blockchain provides the primitives to support a superior payment channel network modelling and the limited scope of its smart contract platform reduces the attack surface and risk of the network making it a superior layer-one solution for payments.

High Throughput & Fast Finality Consensus Kava's PBFT based Proof-of-Stake consensus scales to 1000s of transactions per second and achieves single block finality in less than 2 seconds. This is critical for layer-two payment channels because it minimizes the time for liquidity lockups and provides higher throughput on the main chain. This provides a suitable base-layer for a large payment network to be built on top. The Kava blockchain token is used as collateral in the Kava consensus protocol and will be used to fund state channels on the Kava payment channel network.

In fact, Kava is a combination of Kosmos Blockchain SDK и Interledger Protocol with few changes. As a result, currently, it is too early to make decisions about the final product.

Business model

The Kava token provides access to a decentralized set of Kava validators which confirm transactions on the Kava blockchain. The Kava token is also used to pay transaction fees that prevent spamming of the network. The Kava blockchain is a kind of PoS system, as a result, it issues a block reward to validators and indirectly to anyone who has bonded stake to a validator. The main driver of Kava token demand will be from connectors which will need to use Kava to fund and settle payment channels. As more users enter the Kava network and payment channels are created, the more Kava will be held to back the payment channels. Interestingly, as Kava integrates and supports new assets into its payment network, velocity will increase for those assets.

Finances

The project currently on the very early stage, it has a prototype, but nothing more. Moreover, it is in fact combination of open-source code with some efforts of the team. As a result, it is seed stage project with typical valuation $3-7 mln. In crypto sphere valuation of the total amount of tokens is still a bit higher, so it should be no more, than $10 mln. However, according to the rumours on the market, the project is going to sell 10% of tokens for the early investors for $5 mln. As a result, total capitalization would be equal to 50 mln. We do not recommend to take part in this project with this valuation.

Team

The team currently looks relatively weak for high tech blockchain project. Scott Stuart - CEO of Kava - is a serial entrepreneur who started his career as a professional poker player and then decided to bring his analytical mind to the business world. Prior to Kava, Scott founded the successful adtech company AppEase. Brian Kerr - COO of Kava - is a serial venture-backed entrepreneur. Prior to Kava, Brian was CEO and founder of the esports and gaming company, Fnatic Gear. Ruaridh O’ Donnell - Head of Product and R&D. Ruaridh is a published researcher with a Masters in Physics and has worked in multinational research. He self-taught machine learning before working on data analysis and fraud detection systems with Scott Stuart. Leading Kava’s prototyping and research initiatives, Ruaridh is most at home combining areas of deep research to create products with real world value. Kevin Davis - Lead Engineer - previously worked as an award-winning scientific researcher for the United States Department of Agriculture, where he published papers on invasive species distribution and risk modelling. He holds a Masters degree in Data Science from UC Berkeley, where he studied fault-tolerant consensus algorithms and distributed algorithms. As a result, the team do not have enough experience in the blockchain field.

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