KiKi Finance: Innovative Staking to earn more returns

December 27 19:50 2021

According to Messari’s research report, since the creation of Bitcoin in 2008, PoW Chains have helped company establish business models which focused on maximizing Mining returns. Early Mining companies understood that they could benefit from economy of scale and began setting up “server farms” where energy cost was low, so as to maximize chances of Mining returns. Within 13 years, Crypto Mining has grown into an estimated $31 billion industry.

Meanwhile, PoS consensus-based blockchain offers similar business opportunities for individuals and companies seeking PoS rewards. JP Morgan estimated that PoS based Staking industry has generated $9 billion revenue per year, and will grow into a $40 billion industry in 2025. Evidently, Staking will be a market with great upside in the future.

At present, what Lido does is to provide staking pool service for PoS public chains, which currently support ETH2.0, Terra and Solana. Users stake ETH→Lido→obtain stETH certificates, users can earn Staking profit and obtain sETH 1:1 without locking ETH.

In the past, people supposed that the market transaction price of ETH Staking derivatives would have a certain discount to ETH, after all, xxETH is not the real ETH. The risk of redeeming ETH is frequently mentioned (such as projects failing to pay), which is reasonable. However, Elias Simos, a well-known data and protocol expert of Coinbase, believes that liquidity Staking (especially stETH) will generate significant premium after merger.

After Staking ETH on Lido DAO, Lido will mint 1:1 stETH for stakers, and distribute the collected ETH to the node servers, in order to earn rewards. On the other hand, stETH adopts aToken standard, an interest-bearing token that is minted when principal is deposited and destoryed when redeemed. As the staked ETH continue to earn rewards, total amount of ETH on Lido DAO keeps increasing accordingl, and the balance of stETH in circulation will also increase. StETH generates interest in real time, which can be tracked by investors.

However, there are 3 risks involved in the staking mode provided by Lido: high operation cost, high capital requirement and loss of liquidity. For investors, there is no denying that Lido will bring high premium, but only if they ignore the fatal question of investment cost and return.

When investors stake, they need to own comparable equipments, bandwidth costs and knowledge. Once they go offline or occur error, they may be forfeited rewards an even principal.

KiKi Finance

KiKi Finance is a multichain-aggregated, decentralized, intelligent, open-source Staking protocol for the entire blockchain industry. KiKi Finance is committed to breaking the barrier of public chain, opening more channels for liquidity transactions across public chain, and providing liquidity services to more users.

In contrast to the high-premium revenue model of Lido, KiKi Finance will launch high-value, high-yield, decentralized Staking, where users can stake assests and earn $KIKI with high APY.

KiKi’s platform tokens can participate Staking and high-return liqudity mining pool. Users can obtain higher retun on KiKi Finance through Staking+Farm combination mode than ordinary staking.

It’s worth noting that, notwithstanding today’s huge market potential, Staking still leavesa risk, namely that any system that mints new tokens will have inflation.

People are aware that in DeFi market, lots of people are crazy about genesis mining. The main reason is that the newly mined tokens are valuable because there is very little circulation in the market. This creates a huge arbitrage opportunity for the early participants in DeFi projects. But with the gradual release of the tokens, more and more are circulating in the market. The price of the tokens will very likely to decline as the number of tokens in circulation goes up.

Although lots of DeFi lending and DEX subsidize users by mining platform tokens, most of them go into a death spiral.

Some platforms try to maintain the token price by using a small part of platform income to buying back platform tokens. Yet, under the condition that the amount of mining is constant every day, inflation will inevitably occur. This will lead to a sharp drop of token price and users’income, TVL plummets, accelerating users mining, selling and withdrawal.

For a project, without a inflation control mechanism, the market maker will get less and less rewards. This death spiral is not conducive to future market. Therefore, in order to maintain the token value, a project must expand and application scenarios of the tokens. Locking tokens in application scenarios can reduce circulation and thus, maintain the token value.

The KiKi team sets a high Pearson correlation coefficient (positive correlation) between the number of mining platform coins per day and the platform TVL. This innovative design effectively controls the number of platform token circulating in the market, lengthen the life cycle of KiKi Finance, thereby avoiding the unnecessary death spiral of mining, selling and raising. When the TVL is high, more $KIKI will be produced; when the TVL drops, less $KIKI will be produced.

On the basis of input-output theory, KiKi team will redistribute the number of mining tokens determined by the total TVL of the platform every day according to the income of different staking projects (that is, the contribution to the platform), so as to ensure the fairness and balance of the benefits of different users.

Why choose KiKi Finance?

Clearly, nowadays Staking is considered as the blue ocean market, then how will KiKi Finance get to the top in this market?

At present, the development of DeFi is rapid, assets such as basic lending protocol, token exchande service, derivative market, asset management tool, and aggregated financial products, provide more possibilities to DeFi. However, most of the projects still have a very high barrier for newbies to participate.

Therefore, KiKi Finance is committed to providing users with a friendly, secure and convenient product, let more new beginners join in blockchain world.

Decentralize Staking protocol KiKi Finance, allows users stake tokens with one-click, and get k-token certificate. KiKi provides 1:1 k-token for users. Unlike Lido, KiKi’s staking certificate can be traded on other platforms and applied in derivative and lending market.

As for liquidity problem, $KIKI will be provided as liquidity certificate for assets with longer lock-up period. When k-token are endowed with multiple rights and interests, it can be applied in more scenarios. Meanwhile, this will effectlvely address the liquidity problem.

In traditional business model, staking is holding money to earn interest, a little similar to P2P. But the fundamental difference is that interest is not generated in vacuum. On the contrary, it participates in network construction through staking and redistributes the network ownership to people who have involved in maintaing network security.

The main ecological roles are nodes and token holers. Nodes need to meet the hardware threshold, mortgage threshold and so on. Generally speaking, most of the node servers are wallets, mining pools, exchanges, community nodes and investment institutions. Becoming a node will bring block rewards, but also, they are able to do something eveil.

Through KiKi Finance decentralized staking channel, users can directly participate on chian staking, and the tokend are routed directly to the project node (Validator), where strict access is set up, allowing only the required p2p ports. independent security groups are used for management and the security can be promoted by restricting IP address.

Additionally, users oprate KiKi through decentralized wallet addresses, with assets remaining in wallet and no transfer. All the transactions related to staking occur on chain. The private keys require multi-signed and saved offline. The professional technical solution based on zero trust ensures the absolute security of private keys and blocks any potential risk.

There is no denying that centralized staking continues to dominate the market. But decentralized staking, like KiKi Finance, is also superior. Moreover, with the flexible liquidity provided by decentralized staking, it is expected to accupy more market share in the future.

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