Kujira
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Kujira
The Kujira project was originally conceived as an ecosystem of dApps in the Terra network. The first dApp from Kujira was ORCA (Q4 2021), which allowed some users to receive a discounted deposit from other users with excessive debt. The next dApp was Beluga, which allowed users to send any CW20 token to Terra to multiple addresses simultaneously in a single transaction.
On May 12, 2022 at 01:58:49 (UTC), after days of uncertainty, the Terra blockchain was shut down. The tragic death spiral buried many projects and today we will talk about Kujira, which survived, moved to its own network and became stronger.
With the launch of FIN (the new decentralized order book exchange), some concerns about technical limitations began to emerge. One concern was scalability, as sharing the network with other protocols also meant sharing network bandwidth for transactions, which had become congested even before Terra's problems began.
After the events with Terra, Kujira essentially had two options:
A) build a network on top of an existing L1 network such as Ethereum or Avalanche;
B) create its own independent, sovereign network.
Option A provides an off-the-shelf platform with existing security and interoperability, but requires Kujira products to be built within the technical boundaries of smart contracts and does not help solve the scalability (bandwidth) problem. Option B, however, gives full control over the protocol design, allowing for more sophisticated functionality where, for example, support for trading bots can be built into the underlying protocol.
The problem of choosing between A and B (and given that Terra was built on Cosmos) is solved by moving to the Cosmos ecosystem's own L1 network, where the development team has full control over protocol design, as well as initial compatibility with all other Cosmos networks thanks to the Cosmos SDK. This solution allows applications and infrastructure to be quickly migrated to the new network, giving a much faster start than any other alternative.
Already in June 2022, Kujira launched a testnet, and in July the main working network. Also, migration of $KUJI tokens from Terra network was organized via Keplr wallet (link here).
Kujira kicked off in July 2022 with the launch of 3 products in its network (ORCA,BOW and POD came later):
Kujira Blue.(A KUJI dashboard that allows all the classic Cosmos activities (voting, steaming, awarding, etc.) to be done in one place.)
Kujira Finder ( the classic web explorer ).
Kujira FIN (DEX);
Kujira BOW - Kujira's liquidity hub;
Kujira POD - a tool for rebalancing delegations to validators to increase network decentralization;
Kujira ORCA - a tool that allows you to purchase liquidated assets at a discount.
An idea. Everyone deserves to be a whale.
Concept. For decentralized finance to be truly revolutionary, there must be an opportunity to generate income both when the market is rising and when it is falling. Kujira aims to help retail investors move beyond exchanges, betting and ICOs to unlock opportunities that were once only available to whales and the elite.
Objective. To create tools that are simple and cost-effective for everyone from the novice crypto-enthusiast, to the seasoned retail investor, regardless of their consistency of choice, without having to risk more than they can afford to lose.
Kujira boasts a block generation time of around 2.2 seconds, making it one of the fastest networks in Cosmos along with Evmos (1.9 seconds) and Injective (2.4 seconds), while other Cosmos blockchains typically have block generation times around 5-7 seconds.
Fast block generation is especially important for FIN, as it is a DEX based on order book. Short block generation times are important for the Kujira network, especially for a decentralized FIN exchange operating on the order book model. Moreover, the shorter the delay between the generation of two successive blocks, the less opportunity validators have for front-running.
Kujira ecosystem
FIN by Kujira
FIN is a decentralized order book exchange. Soon the possibility of margin trading will be added.
Within one week of the launch, trading volume was just under $1 million in just two pairs: KUJI-axlUSDC and wETH-axlUSDC.
FINfees are divided into two parts:
1) "Maker Fees" are commissions paid if you place limit orders that are not immediately executed and thus "create" liquidity in the order books. FIN declares its main distinction to be that there is no need for a liquidity pool, which offers three huge advantages:
- You don't need to hand out millions of printed/inflationary tokens just to keep people in LP;
- Your community is not at risk of Impermanent Loss just for trying to support your project;
- You can reallocate the liquidity belonging to your protocol to something more productive.
Every degen faces a vicious cycle where as the supply of tokens increases, their value decreases and inflationary rewards begin to decrease in dollar terms. As the APR decreases for liquidity providers, the rewards may no longer justify the opportunity cost, and they may seek profit elsewhere while taking their liquidity with them. To put it another way, it's a classic story where we farm for the first 3-5 days, then take funds out of the pool and run to another DEX. Exchanges operating on the order book principle are not subject to this problem.
2) Taker Fees - fees paid when placing market and limit orders, which are executed immediately. They "take" liquidity from the books and therefore pay a higher fee.
Commission fees for placing and executing orders on FIN are much lower than on most AMMs. The standard commission for trading on AMMs is 0.3%, which is twice as much as on FIN.
Gas fees on Kujira are also very cheap, and users on FIN can pay in several different denominations of gas. This is beneficial because when an asset rises in value, gas will consequently cost more when using that token; paying commissions in different tokens allows customers to use the currently cheapest option . For example, if the value of KUJI is skyrocketing, you can switch to paying for gas in OSMO.
However, on Ethereum, commissions often become an issue only when the network is overloaded. Therefore, in addition to low commissions, FIN can guarantee execution of transactions at more favorable prices for the user.
Execution of trades Thanks to the order matching mechanism on exchanges operating on the order book principle, traders are guaranteed execution at or better than the specified price. When you place a limit order, your trade will not execute at a worse price, regardless of the size of your trade.
All the details and features of the FIN and its benefits are described in this article.
FIN has chosen to use Axelar's USDC wrapper, axlUSDC, as its stablcoin.
Trading is possible with KUJI, ATOM,OSMO, EVMOS, JUNO, LUNA, SCRT, wETH.
Read more about how to trade on Fin here.
ORCA by Kujira
ORCA is a public trading platform that allows users to purchase liquidated assets at discounts.
On Terra Classic, ORCA allowed users to bid for liquidated positions on the Anchor protocol using UST and aUST. This was made possible by the Anchor liquidation queue contract, which incentivised liquidators to undertake liquidation activity on collateralised positions by allowing them to receive the underlying collateral at a discount.
Users placed bids with a preferred premium, which is the discount a bidder receives for liquidating loans on Anchor. Premiums ranged from 0% to 30%, and loans were liquidated starting with the lowest premium, after which the next highest premiums were activated until no collateral remained for liquidation or there were no more bids.
Before ORCA, loans could only be liquidated by bots or users directly interacting with the smart contract of the liquidation queue. This put ordinary users at a disadvantage, as only a select few could profit from the liquidated collateral.
ORCA also allowed users to profit during market downturns, as liquidation occurs more often during a fall in the price of the underlying collateral. Successful bidders received assets at reduced prices, with many using ORCA as a DCA tool to buy cheap bLUNA and bATOM during market downturns.
ORCA Commissions (thanks to @vladimir_g_g for clarification)
Commission for all successful (executed) liquidation applications:
is 0.5% of the total amount of the withdrawn assets, (i.e. this fee is not withdrawn immediately, but when the Liquidator withdraws assets from Orca, which he received through his executed application for liquidation).
100% of all commissions generated in this way at ORCA are paid to KUJI's stackers, and are paid in the assets that are withdrawn by the liquidators.
Network Commissions:
Placement, cancellation and withdrawal of liquidation orders require a contract to be signed, which means commissions for transactions on the network. Usually such commissions are only a couple of cents.
Liquidator's fees:
Liquidators (those whose application for liquidation is successful) are usually paid 1% of the loan amount - this percentage is determined by the lending market. These fees are paid by the lending markets and are NOT deducted from the collateral that is purchased on ORCA (by the liquidator at a discount). In other words, lending platforms (e.g. Karura) that use Orca as a liquidity return tool pay additional 1% of the collateral amount to the Liquidator, as an incentive to its performance.
BLUE by Kujira
BLUE is the core of the Kujira ecosystem and contains the ecosystem dashboard, a wallet, a simple swap user interface, an IBC bridge, and a management portal.
The Kujira wallet on the Blue dApp has advanced functionality, allowing users to send tokens to multiple recipients with vesting periods (at predefined times). This can be used by protocols, DAOs or anyone who wants to make payments with custom sending periods without having to develop their own vesting contract.
The Swap interface on BLUE does not differ from the basic swap user interface found on AMM DEX. However, trades made through Swap are routed through Kujira's own CLOB DEX, FIN. This represents an alternative frontend for users who are not used to the more advanced trading interface that FIN offers.
Kujira POD
As part of its commitment to promoting network decentralization, Kujira has introduced a new user interface for staking. With this interface, potential delegators can clearly see validators that have been demoted in the ranking for various violations. Another important piece of information displayed on the screen is the "Equal Power Threshold."
The "Equal Power Threshold" is calculated as the total stake divided by the number of active validators. For example, in the test network, there are 20 active validators, so in a uniformly distributed and ideally decentralized network, each validator would have exactly 5% of the total voting power.
Currently, on the MainNet based on the current total stake of KUJI and the number of active validators, the equal power threshold is approximately 1.33%. This number varies depending on the total volume of KUJI stake and the size of the active set of validators.
The new staking interface clearly displays how the voting power of an individual validator relates to the equal voting power that is often characteristic of an optimally decentralized Proof of Stake network setup.
The tool allows the user to distribute their delegation taking into account the validators' weight, ensuring optimal decentralization.
Kujira BOW
BOW is a new product from Kujira, a framework that provides optimal trading conditions for pairs on FIN, an on-chain orderbook DEX provided by Kujira. BOW aims to attract liquidity providers by offering yield for adding liquidity to trading pairs, narrowing the price difference, and providing deep order books for traders. BOW also allows protocols to further incentivize pool depth by distributing rewards for liquidity providers' tokens.
BOW uses an internal algorithm to automatically place orders on FIN pairs based on its own internal token balance, similar to the X*Y=K algorithm used by automated market makers like Uniswap. When purchases and sales occur on the market, these orders are filled, which causes a change in the internal calculation of the contract price and a re-placement of orders at the new average price. BOW is an autonomous and 100% on-chain market maker for the FIN orderbook.
To use BOW, connect your wallet in the Pools tab and top it up as needed in the Swap tab. Choose the pool you would like to participate in, enter the desired amount of tokens, and create liquidity provider (LP) tokens. Holding LP tokens gives you a share of the fees from trades using that pair, which can be further increased by staking LP tokens.
BOW offers several advantages for the ecosystem, including an on-chain market-making solution that is independent of third parties, as well as the ability to stimulate pool depth through fees and rewards. It also provides a stable and deep order book for traders, leading to higher volumes and increased stability.
Kujira $USK
Kujira $USK is a Cosmos native stablecoin with overcollateralization, a soft mechanism for pegging to the US dollar, initially backed by $ATOM, $ wBNB, $DOT, $wETH, $LUNA, $gPAXG. Some users stake to mine $USK, while others burn $USK to pay off their stake. Additionally, if a user's stake value drops too low, they will be liquidated. $USK is intentionally integrated into ORCA to provide seamless democratic liquidation that will be publicly available to all users. Kujira will not allow $USK collateralization from centralized issuers (such as USDC) to avoid reliance on their locked-in smart contract.
It is planned that the set parameters such as minting fees, loan APR, liquidation fees, ORCA withdrawal fees, and maximum LTV will be conservative and then community-managed as part of natural policy. The following indicators were initially expected within this setup: 0.5% minting fee; 5% APR loan interest rate; 1% liquidation fee; 0.5% ORCA withdrawal fee; 60% maximum LTV for $ATOM (i.e., 67% with overcollateralization).
These figures can be discussed by the community later, once everything is ready.
What makes $USK stablecoin from KUJIRA interesting:
Experience in creating a first-class liquidation queue for Anchor Protocol #3 DeFi TVL dApp.
Experience with $UST crash at level zero.
Reliable, theoretically sound system used by Maker DAO.
As a Cosmos native stablecoin, $USK provides another use case for $ATOM that contributes to value accumulation.
Rust is an expressive code base for $USK and easily allows for greater technical complexity compared to JavaScript or Solidity. It is also inherently more secure (error-resistant) and is increasingly used for financial applications due to the level of security guarantees.
$USK, a key infrastructure, is sovereign, uncensored, and income-generating.
Mobile wallet by Kujira
on July 4, 2022, Kujira announced Its mobile wallet. While not many details have been given, we see this as a possible catalyst for the Kujira ecosystem, as such a wallet facilitates user connectivity and provides potential utility for everyday transactions.
Team
The team operates anonymously, but enjoys a reputation in the Terra and Cosmos communities for their ability to create useful products with much needed utility and excellent UX.
$KUJI
Kujira network's native token is $KUJI. The total supply of $ KUJI is 122.4 million tokens.
Purpose of the token: payment for gas in the network. All fees collected are distributed among participants steaming $KUJI. It is important to note here that $KUJI is not an inflationary token.
Issuance: token generation started in November 2021 with the following issuance schedule:
Roadmap
Naturally it is worth watching from the beginning of the network's new life - the launch of Kujira on L1 Cosmos:
Plans for the near future
Summary
Many believe in Kujira. A very interesting feature is that the interest from the commission is poured rewards in the same coin in which they trade.
After the launch of ORCA, when the number of participants increases, steakers are entitled to expect good rewards with a very small % (0.47% at the start) for steaking. Today the picture looks like this:
In addition, protocol interaction rates and site traffic growing. These numbers, although small, indicate that Kujira is in a healthy growth state, especially considering the unfavorable market at the moment.
DYOR!
Useful links and notes
Review the polls by proposal;
Where to buy $Kuji: https://fin.kujira.app/trade;
A useful bot in working with Kujira ( @KujiraNotification_bot );
Get USDC to and from the Kujira network: bridge -> http://satellite.money
How to buy axlUSDC:
Review the polls by proposal;
Telegram (Russian speaking community);
Where to buy $Kuji: https://fin.kujira.app/trade;
A useful bot in working with Kujira ( @KujiraNotification_bot );
Get USDC to and from the Kujira network: bridge -> http://satellite.money
How to buy axlUSDC:
If interested in validators from the Ru-speaking community, here they are:
- cyberG
- MMS
- vbloher
- AM Solutions 🐋
Transfer via IBC Transfer from Keplr's addresses to Kujira(Keplr):
Only works with native network tokens - from Secret network only SCRT, from Cosmos Hub only ATOM, from OSMOSIS only OSMO, etc.
- Secret Network --> Kujira: channel-22
- Stargaze --> Kujira: channel-49
- CosmosHub --> Kujira: channel-343
- Osmosis --> Kujira: channel-259
- Evmos --> Kujira: channel-18
- Juno --> Kujira: channel-87
Important: In addition to USDC, it is better to use:
https://blue.kujira.app/ibc
and for the USDC from osmosis to kujira
https://satellite.money/?source=osmosis&asset_denom=uusdc&destination=kujira
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