Kima Whitepaper
  • Introduction
  • About The Kima Blockchain
  • Existing Challenges with Asset Transferring
  • The Kima Infrastructure
  • Example: Liquidity Provider Incentivization
  • Incentive Scheme
    • A. Incentive Scheme: Liquidity Penalties and Bounties
    • B. Incentive Scheme: Protection Mechanisms
    • C. Incentive Scheme: Passive and Active Liquidity Providers
  • Simulation of Kima's Liquidity Management
  • Network Income and Distribution
  • Impermanent Loss and Arbitrage
  • Protection Against Blockchain Reorganization
  • Kima's Technology and Other Solutions
    • About Asset/Token Wrapping and Cross-Chain Bridges
      • Custodial Wrapping
      • Non-custodial Wrapping
      • Liquidity Fragmentation
    • Direct Messaging
  • The Security of the Kima Blockchain
    • Other Security Threats
  • Conclusion
  • Disclaimer
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  1. Kima's Technology and Other Solutions

Direct Messaging

The Kima platform has several advantages over direct messaging solutions. Kima is aware of all the pools' states and history, at any time/block, and thus can set optimal incentives. Not only that, but also in addition to Kima's core activity (cross-chain transfers), in some cases, and based on users' and governance decisions, it can take additional actions to increase incentives via composability. For instance:

  • Use services (such as Curve) to move liquidity between pools on the same network (i.e., USDT to USDC on Ethereum)

  • Use abundant liquidity to generate additional yield by integrating with other services (i.e., offer loans)

In comparison, pools that rely on direct messages can act only based on local information sent at the message time. While the gain from the Kima optimization is hard to quantify in the abstract, it should improve capital efficiency and thus translate into higher returns for liquidity providers and lower costs to users.

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Last updated 2 years ago

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