Introducing KPerp.Exchange — Decentralised Exchange
KPerp.Exchange is a brand-new type of decentralised exchange created to offer a broad selection of trading options and extremely high levels of liquidity on numerous large-cap crypto currencies.
There are two methods that traders can use it:
- Spot trading, along with swaps and limit orders
- Perpetual futures trading with short- and long-position leverage of up to 30x.
KPerp.Exchange wants to become the go-to option for traders who want to always maintain control over their money without disclosing any personal information.
It has several advantages over other DEXs currently in use thanks to its novel design.
- low transaction costs
- Not even for huge order volumes will the price change
- Protection from liquidation events: The pricing system is designed to smooth out the jarring price swings that can frequently happen in one exchange (also known as “scam wicks”)
- Trading using leverage and spot on the same platform
A multi-asset pool is the answer to trading without affecting prices
The multi-asset pool is the primary innovation at the core of KPerp.Exchange. With the help of this function, the platform can share liquidity among all the assets it supports. This is how it goes.
An equivalent dollar amount of index tokens, known as KLPs, are created for every x amount of assets added to the pool. By exchanging KLP for any asset in the pool and burning it, a liquidity provider can withdraw at any time. KPerp.Exchange can be used to swap big volumes without affecting prices because of this.
Consider a scenario where the pool consists of five assets (20% of each) distributed equally among them (BTC, ETH, Kava EVM, USDC, and USDT). A trader can quickly purchase 50% of the BTC supply with USDC at the exact price displayed on the site, with no price impact.
After the order has been processed, the pool’s state changes to BTC: 10% and USDC: 30%, with the rest remaining the same. Despite the fact that half of the available supply has already been purchased, the price of BTC provided on the site is the same before and after the switch!
The pool gets more or less unbalanced relative to its initial state with each exchange. Liquidity providers will be motivated to deposit assets that are in high demand and disincentivised to deposit assets that are in excess in order to rebalance the pool.
The platform will appear to most traders to have limitless liquidity at a set price, thus eliminating the requirement for an order book.
Blockchain technology and oracle pricing
KPerp.Exchange debuted on the Kava EVM and will eventually add other chains.
At debut, Kava EVM will support two stablecoins and three large caps:
- BTC, ETH, Kava EVM
- USDC, USDT
There are lots of advantages to choosing Kava EVM over other chains:
- Transactions on Kava EVMs are quick and affordable.
- Users can easily be onboarded because of the on-ramp and off-ramp from exchanges.
- On the Kava EVM, Witnet offers numerous price feeds. These are essential to the price structure of the platform and are required for the listing of new assets.
The platform gathers Witnet and Time-Weighted ELK Finance Average Price (TWAP) pricing from significant DEXes and CEXes to determine the price of each asset.
Leverage traders gain a lot from this pricing method since it lowers the risk of liquidation due to the transient wicks you sometimes see on exchanges.
These con artists frequently use order book manipulation by whales to eliminate other traders.
KLP — Liquidity Providing incentivisation
Trillions of dollars will be exchanged on cryptocurrency markets each month by Q4 2022. About $100 billion of this amount is made up of DEXes that enable everlasting trading, and this number is constantly increasing. KPerp.Exchange is in a good position to take a piece of this industry, as its direct rivals earn anything from $5 million to $60 million in monthly fees.
KPerp.Exchange requires a multi-asset pool with lots of liquidity in order to function properly. The platform features a very generous incentive program to make sure this is the case: 70% of the platform fees are allocated to the liquidity providers that created KLP by pooling their crypto assets.
KLP can be viewed as a “crypto majors index,” with stablecoins providing further support. By offering incentives, KLP attracts liquidity providers from established, comparable pools (like the aTriCrypto Curve pool).
The fact that the platform’s leverage traders’ losses are returned to KLP also serves as a counterweight to them. According to data, traders occasionally lose more money than they win; in other words, “the house always wins.” That is KLP in this instance.
KLP — Governance and utility token
KPE is the governance and utility token for KPerp.Exchange. Holders are encouraged to invest for the long term by offering numerous benefits that will quickly accumulate.
30% of platform fees
30% of the platform’s fees will be distributed to KPE stakeholder in the form of Kava on KAVA EVM, the network’s native currency.
Additionally, KPE stakers will receive “escrowed KPE” (esKPE), a non-transferable token that has two uses:
- You can stake esKPE. Then, it will receive the same benefits as KPE that was staked, including multiplier points, kava incentives from platform fees, and more esKPE. This is perhaps the most intriguing choice because it increases APR and revenues and compounds benefits.
- In order to convert and distribute esKPE as KPE, it can also be unstaked and vested. Then, over the course of a year, vesting esKPE unlocks linearly with KPE being distributed with each unlock. The vested esKPE does not, however, earn the staking rewards.
- When vesting your esKPE, you must also put the average KPE/KLP that you used to earn it in a safe. Although the KPE/KLP in this vault cannot be sold, awards are still earned. One can always withdraw the locked KPE/KLP from the vault, however doing so will stop the esKPE from further vesting.
Each multiplication point earns the same amount of Kava as a KPE token, allowing the holder of staked KPE to accumulate protocol fee rewards.
The more time KPE is staked, the more MPs you earn.
However, unstaking KPE or esKPE will result in the same multiplier point loss. For instance, you will lose 50% of your MPs if you unstake 50% of your KPE. Retaking KPE will begin to accrue MPs at a rate of 0.
KPerp.Exchange is already supported by a sizable community, including individuals who participate in its Telegram and Discord channels. The project will draw and keep long-term backers thanks to a thoroughly thought-out incentivization structure and a sharing of 100% of the platform fees among KPE and KLP holders/stakers.