If you don’t want to read the full article, the video below goes over everything written.
Kadena was launched back in 2016 by two men called Stuart Popejoy and Will martino. Stuart led JPMorgans emerging blockchain group and Will had a role as a Tech lead for the SEC’s cryptocurrency committee. So these two founders have a lot of knowledge when it comes to the world of cryptocurrency. Kadena aims to build a scalable and developer-friendly public blockchain that provides a level of security similar to Bitcoin. To support this vision, Kadena features a novel consensus method, a proof-of-work model dubbed Chainweb, and a new smart contract language, called Pact. Its mission is to optimise its base-layer for transaction throughput and developer adoption without the need for any second layer scalability or functionality solutions. It’s basically a layer 1 crypto with all the features of a layer 2 crypto, it combines the two layers into one coin which is the only one of its kind so far. Kadena are pioneers in the industry in that sense. Lastly if you want to buy any kadena then it’s listed on exchanges such as Binance, KuCoin and Gate.io
So far only 198 million coins have been mined and the max supply is 1 billion coins, the last coin is set to be mined in the year 2122. This means we have a while before all the coins are mined, Kadena doesn’t have a normal halving schedule as the block rewards don’t half. I will go further into the block rewards later on. The market cap right now sits around $300 million and is ranked number #108 by market cap dominance. The whitepaper lays out the allocation of coins with 10% going to pre-sale investors, 20% is used as a platform reserve for developers on the network and the remaining 70% is to be mined. 10 million coins were sent to a burn wallet upon launch as per the whitepaper. Kadena can only be mined using an ASIC miner and GPU’s aren’t allowed on the network, the hashing algorithm used is called Blake2s. The typical Kadena miner can be bought for around $4000. Block time on the network is at 30 seconds so is very quick when compared to other chains and the block reward is 1.045 Kadena but that changes as time goes on.
Instead of halving the rate at certain block numbers, Kadena uses an emission rate to distribute coins. The overall emission of the Kadena platform happens through two processes, mining and release of allocated tokens. The vast majority of the overall emission is through mining. As I mentioned earlier there were pre allocated coins which will be released over the next 9 years to investors and developers. Once the 9 years is up the coins will only come from mining. Now the rate at which the rewards decrease is set to 23% per year, this compounds to the previous year so that the coins are distributed on a curve. This way of halving is different and allows for a more natural supply decrease which in turn will allow for the demand to increase slowly as well. As we have seen with Bitcoin, when the havlings happen it tends to spike the price and this is because the supply is reduced overnight and the demand goes up. In my opinion I think this is the best way to set block rewards and many cryptocurrencies have started to adopt this method of halving, however I’ve seen with some coins that they have had to change their emission schedule to extend the life of mining.
As I said previously there was a pre allocation of 20% to developers who want to make dapps on the Kadena blockchain. This treasury fund is called Kadena Eco and has so far produced many great dapps. The application process is open to anyone who has an idea and they choose the applicants based on 4 main points. These are technical strength, details of specifications, team experience and usefulness to the Kadena ecosystem. If you are selected then the Kadena team will help you along the development journey, for example they have mentorships which help developers to achieve the vision they have for their dapp. This fund is worth over $100 million so there is plenty of money to be spread around. There have been many dapps to come out of the Kadena Eco, one of the best I’ve seen is the Kaddex exchange which is a defi platform which has no fees, liquidity pools, KDX staking and KDX mining. So the kaddex exchange has its one token which is minted onto the Kadena chain called KDX and this has the same tokenomics as the main chain. This allows for swapping of the KDA token to KDX and thus incorporating the Kadena chain. This kaddex exchange also has direct integration into the zelcore wallet from Flux, this partnership between the two chains is probably going to propel the two coins up to the top of the crypto list. They both have many different features that put together make an almost perfect chain.
The main problem when making a cryptocurrency is called the trilemma, which is that a crypto must have security, scalability and decentralisation. The reason that it’s a problem is that normally you can only prioritise two of these features and sacrifice the other. This is why they need another layer 2 crypto on top to help with the feature they choose to sacrifice. Now Kadena has solved this trilemma as they have solved the scalability issue that many chains face without scarification of the other two features. This process is called snarfing and has been proven to work as Kadena just upgraded their transactions from 10 lanes to 20. Sharing basically creates more lanes for transactions to run through, this means less congestion and allows for more transactions per second. Kadena can theoretically scale this as large as they want without sacrificing security or decentralisation. All they need do is create a new shard and it will open up 10 more lanes of transactions to go through. So by solving this problem they have become a one of a kind crypto that is the only layer 1 with features of layer 2.
Now all of this wouldn’t be possible without the programming language used by Kadena. Many cryptocurrencies use C++ or Solidity, however the Kadena team actually created their own custom language from the ground up which was specifically made for blockchain technology. This language is called Pact and is actually very easy to use without having too much knowledge about programming. It’s very much catered towards crypto as smart contracts can be produced quickly without errors, this is what I’ve found the most useful about the language. It’s that it doesn’t actually allow developers to make mistakes in their code. For example many smart contracts have led to hacks and this is because the smart contract wasn’t written properly, the Ethereum hack back in 2016 was because the DAO code wasn’t written correctly. In Pact this wouldn’t have been able to be coded, there’s a whole website which displays which hacks could’ve been stopped if pact was used instead of other languages. You can find pact resources and developer tutorials on the official Kadena website, the tutorials vary from easy to very hard in terms of developer ability.
Kadena Private Chain
Kadena also has a private blockchain which has a real world purpose, it’s called Kuro. Private blockchains are made to allow for all the be idiots of public chains while only allowing certain people to access it. So you can have your own private chain to store sensitive data on. This is where Kuro comes in for places like hospitals and healthcare insurance. Because all patient information needs to be correct and tamper proof many companies have chosen to migrate their information onto private blockchains. Kadena’s enterprise blockchain solution showed how providers can share data and buy and sell records using a blockchain-powered marketplace which provides security at scale and speed. This transforms the burden of maintaining provider data from a cost centre into an enterprise business asset. Obviously this can’t be run as a proof of work chain by mining, so kadena uses a different consensus method called Byzantine fault token consensus. It allows for users to add to the chain without seeing other information contained. So this implementation of both private and public blockchain works very well in terms of growing the whole Kadena ecosystem, also it allows for more use of the chain in real world scenarios which is the main goal for a crypto and that is adoption from the masses.