Klaytn(KLAY)

About Klaytn (KLAY)

Klaytn (KLAY) is a public EVM Layer 1 blockchain built primarily for gaming, the metaverse, and the creator economy, with KLAY as its native digital asset. A  project of GroundX, a subsidiary of Kakao of South Korea, Klaytn aims to boost mass blockchain adoption by offering a quick response and reliable blockchain for developers and users. 

Its blockchain features enterprise-grade reliability, low transaction latency, and many developer-friendly tools and policies. The Klaytn ecosystem, through the Klaytn Foundation, presents itself as an open collective with transparent governance to promote mass blockchain adoption through sustainability, verifiability, and collectiveness. 

Notably, upon completing the recent merger with Finschia, Klaytn has rebranded as Kaia following the deployment of its Layer 1 network. The mainnet now enables EVM smart contracts with one-second block times, fostering a decentralized DApp ecosystem on Line and KakaoTalk. 

The Kaia mainnet is a hard fork of Klaytn, not a completely new network. Following the rebrand, the former Klaytn mainnet will operate as the Kaia mainnet.  

How Kaia (Klaytn) works

Formed through the merger of the Klaytn and Finschia blockchains, Kaia is a highly optimized public blockchain designed for enterprise-grade reliability and performance. Below are the key aspects of how it works:

• Fast Transactions: Kaia achieves immediate transaction finality with a 1-second block generation time and can process 4,000 transactions per second.

• Network Architecture: Kaia consists of three subnetworks:

• Core Cell Network (CCN): Handles transaction verification and block creation.

• Endpoint Node Network (ENN): Manages API requests and data processing.

• Service Chain Network (SCN): Independent auxiliary blockchains for specific applications.

• Consensus Algorithm: Uses an optimized version of Istanbul BFT with Practical Byzantine Fault Tolerance (PBFT) for high performance and secure random selection of block proposers.

• EVM Compatibility: The Kaia Virtual Machine (KVM) supports Ethereum Virtual Machine (EVM) compatibility, allowing developers to port Ethereum smart contracts easily.

Potential use cases for Kaia (Klaytn)

Kaia Blockchain aims to be the top blockchain in Asia, driving Web3 adoption by offering a strong infrastructure for projects of all scales. Below are Kaia's distinctive features through its core design principles and value offerings:

• Web2 and Web3 User Accessibility: Kaia integrates with popular messaging platforms like Kakao and LINE, facilitating access for both Web2 and Web3 users through built-in wallets, attracting millions of active users.

• Abundant Liquidity and Asset Support: Hosts various real-world assets (gold, real estate, etc.) and plans to include stablecoins and bonds. It supports DeFi and GameFi sectors through the Kaia Ecosystem Fund and offers automatic MEV profit sharing for KAIA stakers.

• Developer-Friendly Technology: Provides high performance with over 4,000 TPS, scalability through customizable service chains, and full Ethereum compatibility, allowing easy onboarding of EVM-based dApps.

• Affordable and User-Friendly Experience: Offers low, stable transaction fees and supports fee delegation, enabling applications to cover user fees, thereby reducing barriers to user adoption.

• Comprehensive Open-Source Infrastructure: Includes SDKs, wallets, oracles, and various ecosystem support services like DAOs, NFT marketplaces, and DeFi interfaces, fostering a collaborative community and decentralized governance.

KAIA (KLAY): Unlocking the Power of the Native Cryptocurrency

Kaia's inclusive token economy incentivizes varied contributions, ensuring sustainable funding and growth beyond traditional network maintenance roles.  Here are some of its traits:

• Rebranding from KLAY: KAIA is a rebrand of the KLAY token due to the merger of Klaytn and Finschia blockchains. Currently, KAIA's ticker is still shown as "KLAY" on exchanges. Existing KLAY balances will automatically reflect as KAIA once the transition is completed. KAIA market launch is scheduled for Q3 2024 to ensure synchronization across exchanges.

• Token Supply and Inflation: 9.6 KAIA will be minted with every new block, resulting in approximately 200 million new tokens annually (5.2% annual inflation rate). This rate can be adjusted through the Kaia Governance Process.

• Units of KAIA: The smallest unit is ‘kei,’ with a KAIA being 10^18 kei. This detailed unit structure allows precise and varied token transactions.

• KAIA as Network Fuel: KAIA is used to pay transaction fees, incentivizing developers to create efficient applications and compensating network consensus nodes. This ‘fuel’ keeps the network healthy and functional.

• Funding Structure: KAIA's issuance supports network maintenance and growth:

• 50% goes to Validators and Community (10% for block proposer rewards, 40% for staking rewards).

• 25% to the Kaia Ecosystem Fund (KEF) for network development, developer community building, and investments.

• 25% to the Kaia Infrastructure Fund (KIF) for infrastructure R&D, ecosystem acceleration, and operational expenses.

• Governance and Staking: The Kaia Governance Council oversees network maintenance. Council members must stake at least 5 million KAIA, with rewards distributed based on staking amounts. Misbehaving members face penalties.

• Token Economy Flexibility: The Treasury Rebalance mechanism allows for adjusting treasury funds as needed. It operates through a smart contract ensuring transparency, validator consensus, and adaptability to changing market conditions.

Should you invest in KAIA (KLAY)?