# The Kima Infrastructure

Kima’s infrastructure offers a seamless cross-chain transfer of digital assets via running a network of decentralized liquidity pools. By creating and managing liquidity pools across several Layer 1 and Layer 2 blockchains, value can be transferred 1:1 without relying on synthetic/wrapped assets or centralized players. The Kima protocol monitors and synchronizes assets across these blockchains via a decentralized settlement layer and provides a simple and secure mechanism for allowing users to perform cross-chain atomic transfers and swaps without token wrappin&#x67;**.**

This example will assume that the Kima has established pools on three Layer-1 blockchains (A, B, and C). With Kima, users can transfer assets between addresses on:

* Blockchain A and B (i.e., exchanging USDT on Ethereum for USDC on Solana and vice versa)
* Blockchain A and C (i.e., exchanging USDT on Ethereum for BUSD on the Binance Blockchain and vice versa)
* Blockchain B and C (i.e., exchanging USDC on Solana for BUSD on the Binance Blockchain and vice versa)

For Kima’s service to work well, all pools must have sufficient liquidity to support withdrawals and be adaptive to the market movements. The Kima protocol monitors and take the following actions:

* If a pool receives several withdrawal requests, it should be replenished.
* If there is too much liquidity in the pool, it should be decreased to maximize capital efficiency.
* If there is a strong demand for withdrawals from a pool (i.e., Pool B), the other pools' liquidity can be directed there to address demand.&#x20;

The Kima blockchain stores up-to-date information of all pools and optimally transfer assets between pools as needed. In this case, optimal refers to both the quality of service (i.e., provide liquidity when/where needed) and the protocol’s availability to address financial risk and minimize both the costs and the amount of liquidity locked within the blockchains.

While the Kima protocol can automatically monitor and manage the pools, it will require strong relationships with external liquidity providers. We have designed an incentive scheme for these players that aligns with their motivations and our desired behaviors (i.e., helping replenish or move liquidity as needed).

The following section explores how liquidity providers are motivated to move liquidity from over-funded pools to pools that need replenishment and how users can use the Kima platform and services.


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