What is Kava coin and how does it work? What makes kava unique? Kava price analysis: technical view. Kava mainnet upgrade and Loan Wars competition. AscendX launched Kava Swap liquidity event. Hummingbot partners with Kava. Kava Labs launches Kava Swap. Kava Labs and Nervos to provide cross-chain liquidity. Kava price prediction: analyst sentiment.
DeFi has generated a lot of buzz in the cryptocurrency space. The number of DeFi platforms and use cases is constantly growing. According to The Block, the entire value locked in DeFi on the Ethereum blockchain has risen to about $83.6bn, as of 21 December 2021, up from $13.32bn at the start of the year.
One of the DeFi platforms that caught investors’ attention in 2021 was Kava, which aims to establish the world’s first dedicated DeFi network to present collateralised debt and stablecoins for the major crypto assets, according to its whitepaper.
This article will examine Kava’s long-term usage and adoption prospects, as well as several Kava coin price predictions and analysts’ estimates.
What is Kava coin and how does it work?
Kava’s platform enables customers to mortgage and lend assets without the need for a traditional financial intermediary.
The network’s users can utilise USDX to collateralise their crypto assets. USDX acts as Kava’s stablecoin throughout the network.
To acquire USDX loans, users must store their cryptocurrency in a smart contract on the network. The locked cryptocurrency serves as security for the loan.
The KAVA token is the network’s native cryptocurrency, with a total supply of 154 million coins. It powers the Kava network, and is used for governance and staking.
In terms of governance, KAVA holders can vote on proposals to amend the blockchain or framework parameters in the same way as voting rights are provided for a company’s equity stock.
On the other hand, staking allows users to assign voting rights to validators who protect the network. In exchange, they get transaction fees as well as user-charged stability fees.
What makes kava unique?
Although most DeFi projects are built on Ethereum, Kava is built on Cosmos, whose team claims it gives further functionality to the network.
Kava uses a Cosmos feature called zones to govern the crypto assets it accepts, which represents a network of many independent blockchains.
The Kava DeFi platform serves as a decentralised bank for cryptocurrencies. It enables users to access different financial services, including USDX, its native USD-pegged stablecoin, and derivatives.
Using Kava, inventors can borrow USDX tokens by depositing collateral, which helps to leverage their exposure to cryptocurrency assets.
Kava price analysis: technical view
The KAVA token was priced at $0.95 when it was launched in October 2019. The price surged by more than 450% between June 2020 and August 2020, from $0.87 on 1 June to $5.09 on 16 August 2020, before falling to $1.29 by the end of 2020.
The rally resumed in January 2021, with the price rising from $1.30 on 1 January to the all-time high of $14.38 on 9 September 2021. Between January and September, there were several periods of retracement, but the price recovered following the sell-offs.
Failing to hold its all-time high, Kava price gradually decreased and is now down by more than 65% from that all-time high, trading at $3.54, giving it a market cap of $512m, as of 21 December 2021. It’s generated a 668% ROI for investors since its inception, according to CoinMarketCap.
Kava crypto news and price drivers
Kava mainnet upgrade and Loan Wars competition
Kava 9’s mainnet upgrade is underway, with completion planned for late Q4 or early Q1 2022.
It will upgrade the Kava mainnet to Cosmos SDK version 44, enabling communication between Kava Ecosystem and all IBC-enabled chains.
“This is a huge step for Kava, as it will mean unlocking the ability not only to bring assets from IBC-enabled chains onto Kava, but also to easily move $KAVA, $HARD, and $SWP off Kava to be used on other chains. This will provide a number of new onramps to the Kava ecosystem, new earning opportunities for users of the Kava Platform, and new utility for the existing native Kava assets,” according to the press-release.
Additionally, the Kava Launchpad will provide the groundwork for the Kava Ecosystem’s continuing expansion in 2022 by providing the architecture for a future Ethereum bridge, Kepler wallet compatibility and other developer enhancements.
Preparing for the upcoming IBC integration, Kava is conducting the Loan Wars competition from 15 December to 29 December. The tournament will have a total prize fund of $150,000.
Throughout the competition, players will be required to earn and claim rewards on the Kava Platform using a combination of testnet and mainnet assets. Whoever has claimed the most rewards on their testnet account by the end of the competition will be declared the winner.
AscendX launched Kava Swap liquidity event
AscendEX launched a liquidity mining event for Kava Swap on AscendEX from 1 November to 8 November, enabling users to lock up their KAVA tokens to receive a high rate of return over time.
During the event, users who deposited KAVA and USDX in the Liquidity Mining Program earned double rewards in the form of SWP tokens, including the standard SWP token award and additional SWP tokens of the same value.
Additionally, between 8 November and 25 November, there was a KAVA trading tournament with numerous incentives and prizes.
Hummingbot partners with Kava
In October 2021, Kava Labs partnered with Hummingbot, an open-source market-making and arbitrage bot toolkit, to incorporate Hummingbot into the Kava Ecosystem.
The Hummingbot ecosystem integration will link Kava Swap to the Hummingbot framework, enabling Hummingbot users to execute automated trades and market-making on Kava Swap while also reaping liquidity benefits.
Kava Labs launches Kava Swap
Kava Swap is a decentralised, cross-chain, Autonomous Market Making (AMM) protocol meant to enable an effective and robust means to swap natively across the world’s major assets. It was released by Kava Labs in October 2021.
Kava Swap provides retail and institutional users access to the Kava ecosystem’s on-chain liquidity, allowing them to exchange assets, expand earning opportunities and optimise rewards.
“From our inception four years ago, Kava Labs’ mission has been to build a portfolio of decentralised products and services that allow users to gain access to all of the benefits of DeFi, but without the risks present in the current marketplace,” said Scott Stuart, Co-Founder and Head of Products at Kava Labs. “As we expand our ecosystem, Kava continues to deliver on the promise of constructing an open and scalable institutional-grade platform that provides the same level of efficiency, security and ease of use as main street financial products.”
Kava Labs and Nervos to provide cross-chain liquidity
On 10 December DeFi platform operator Nervos announced it is integrating the Kava network with its cross-chain Force Bridge product to bridge liquidity between Kava and Nervos. It said the integration will “allow for the movement of native assets between the chains, giving $CKB holders new ways to use it on the Kava platform and bringing Kava to dApps on the Nervos network”.
The partnership will focus initially on integrating Kava with Force Bridge shortly after Kava’s EVM support is launched in 2022. This will connect the Kava and Nervos chains, allowing for assets to be bridged between the chains.
Kava price prediction: analyst sentiment
Commenting on the Kava coin value and future prospects, Capital.com’s analyst Mikhail Karkhalev said:
“Projects like Kava will always be in demand, as cryptocurrency lending is a great way to hedge potential downside risks in the market, and to make existing assets work on a new front rather than just lying around in a wallet. In fact, users can freeze a notional bitcoin for a certain period of time and use stablecoins to buy other coins, trade and or grow capital in any other way, while the pledged asset is kept safe.
“The only disadvantage of projects like Kava is the high competition. Some of the main competitors include Nexo and Compound. Nexo has more functionality; Compound represents the DeFi sector.
“When comparing all three projects, if the crypto lending services market gets regulated, Nexo and Kava will most likely have to adjust to the new rules and possibly significantly change their lending policies. Compound in this sense, being a decentralised protocol, would be less problematic. In fact, the main challenge for such projects is chasing customers and pulling them to their side. The market share occupied by a project is a key indicator of its potential. Kava is, at the moment, a leader.”
Kava forecast: Price targets for 2021, 2022, 2025, and 2030
Algorithm-based forecasting tools share bullish Kava coin price predictions, as of 1 December 2021.
- According to Wallet Investor, KAVA will be worth $6.54 at the end of 2022, $9.4 at the end of 2023, and $15.2 at the end of 2025. Although the forecasting service does not provide price targets for 2030, it’s longer term Kava forecast expects the price to hit $18.1 by the end of 2026.
- DigitalCoin believes KAVA will maintain its positive trend in the long-term. It expects the coin to hit $5.83 by the end of 2022, $6 by the end of 2023, $7.51 by the end of 2024, and $7.17 by the end of 2025. DigitalCoin predicts that the cryptocurrency will reach $14.8 by 2028.
- In line with other algorithmic forecasters, Price Prediction is bullish in its Kava coin price prediction. It forecasts the price of Kava token to average $5.18 in 2022, move up to $7.7 in December 2023, $16.50 by the end of 2025, and $107 by the end of 2030.
When looking for Kava (KAVA) price predictions, bear in mind that analysts’ forecasts can be wrong. Analysts’ projections are based on making a fundamental and technical study of the cryptocurrency’s performance. Past performance is no guarantee of future results.
It’s important to do your own research and always remember your decision to trade depends on your attitude to risk, your expertise in the market, the spread of your investment portfolio and how comfortable you feel about losing money. You should never invest money that you cannot afford to lose.