Altcoin Explorer: Kava (KAVA), the Cross-Chain DeFi Platform
To an extent, Kava can be compared to major DeFi platforms such as MakerDAO (MKR) that allow users to deposit crypto assets as collateral – or technically a collateral debt position (CDP) and take loans in the form of stablecoins. For Kava, the platform’s users can deposit cryptocurrencies such as BNB, BTC, ATOM, XRP, and borrow its native fiat-pegged stablecoin, USDX.
Kava’s primary product is the Kava collateralized debt position (CDP) platform where users can deposit their collateral in exchange for loans disbursed in the USDX token. 1) Joe deposits any of the supported cryptocurrencies by sending it to the Kava platform 2) The Kava CDP platform accepts the cryptocurrency deposited by Joe and locks it in a smart contract as collateral 3) Subsequently, the smart contract issues the USDX stablecoin as loan in proportion to the collateral desposited by Joe 4) Joe can later repay the debt, along with a minuscule stability fee, at any time, and unlock their collateral from the smart contracts 5) Once the collateral has been returned to Joe, the Kava CDP platform automatically burns the USDX tokens Kava has a healthy score when it comes to sharing periodical ecosystem updates with the community.
