Why Kucoin community chain is the ‘next big thing’ for defi projects – Ever since the summer of decentralized finance (Defi) in mid-2020 which found it roots with the liquidity mining program of COMP tokens launched by Compound in May last year, defi as a sub-section of the cryptocurrency industry has gained lots of attention from the crypto community. Defi played a key role in restoring more confidence in cryptocurrency shortly after the black Thursday of May 12, 2020 which led to ethereum losing over 30% in value within 24hrs.
The crypto community have seen major projects leading the charge into next evolutions in defi like Yearn, developed by Andre Cronje in early 2020 which is a yield optimizer that focuses on maximizing DeFi capabilities by automatically switching between different lending protocols.
In early 2021 we saw Binance Smart Chain (BSC) developed by the Binance exchange for defi projects capitalizing on Ethereum’s slow transactions and high gas fees and exploded in adoption leading to Ethereum network losing over half of transaction volume to the competition.
But analysts have highlighted a major drawback for Binance smart chain which is the fact that it operates on a Proof-of-Stake (Pos) model that uses 21 validators, chosen daily, to confirm transactions on the network. Just 11 of these validators are responsible for the network’s governance; by contrast, there are more than 77,000 validators who have staked on the Ethereum 2.0 network. In theory, anyone who holds this much BNB can become a validator. However, several researchers at Messari believe that the validators on the BSC network could be a little too connected to Binance itself leading to the theory that Bsc is over centralized.
What is Kucoin community chain?
Kucoin community chain is built by the fans of KCS and KuCoin, KCC is a decentralized public chain with high performance. KCC features high throughput, low latency, low transaction cost, and satisfactory security and stability, aiming to provide community users with faster, more convenient, and lower-cost experiences.
KCC introduced the Proof of Staked Authority (PoSA) consensus mechanism and reduced the block confirmation period to 3 seconds to improve the processing power and performance on the chain. At the same time, KuCoin Token (KCS) is used as the only fuel for KCC to reduce transaction costs. Thus, KCC has successfully achieved faster transaction confirmation speed, higher transaction performance, and lower transaction fee.
In addition, KCC is compatible with Ethereum and ERC20 smart contracts, which offers extremely low migration costs for projects.
Are we going take see KCC to huge chunk of volume from Ethereum and Bsc?
Kucoin token (KCS) have seen upward price movement in recent weeks thanks to kCS being used as the only fuel for KCC to reduce transaction costs.
Kucoin community chain is fully compatible with Ethereum and ERC-20 smart contracts, extremely low costs in migration and KCS token is the only fuel and native token for KCC and can be used to pay gas fee.
The blocks are produced every 3 seconds, accelerated transaction confirmation and higher chain performance and adopt the consensus algorithm of Proof of Staked Authority (PoSA), more efficient, secure and robust.
Already, defi projects are already launching on KCC network with projects such as KCCPAD becoming the first Launchpad for the network. As a community network projects like decentralized exchanges, defi protocols, tools and lending protocols are fully developed and maintained by the community.
Only time will tell if Kucoin community chain will become a giant defi ecosystem like Ethereum and Binance smart chain; also it provides new opportunities for crypto traders and investors to capitalize on the current momentum for the next 10x gains.
Disclaimer
This article is for information purposes only and should not be taken as a financial advice, consult your financial advisers for professional financial advice.