Kadena - $KDA, Asset Review
Figure A
General Information-What is Kadena
Kadena Background
Kadena Funding/Collaboration
Token Information-Tokenomics
Mining $KDA
Additional Information-
What’s Next?
Technical Analysis
Conclusion
General Information-
What is Kadena?
Kadena is a layer-1 Proof-of-work blockchain that has created a way to scale and optimize smart contracts by using the chainweb. The chainweb is a linked, parallel consensus mechanism that improves scalability and throughput while sustaining security. The chainweb is useful because it has such an optimal layer that layer-2’s are not needed for scalability. Another common issue amongst blockchains is smart contract exploits. Kadena has found a way to create a developer-friendly smart contract language called “pact” which makes it simpler when upgrading and verifying contracts. Kadena also developed a private blockchain called Kadena “Kuro” which is a layer-2 that may handle 8000tps with over 500 nodes on the network.
2. Kadena Background
Kadena LLC is a project based out of the greater New York City Area and founded by Stuart Popejoy & Will Martino in 2016. The founders created Kadena because they wanted to solve the problem of scalability that Bitcoin faces. Kadena founders claim by using the chainweb, it allows for scalability, security, and decentralization. Bitcoin currently uses one chain which limits its throughput, however, Kadena uses multiple chains. By using multiple chains, the founders believe that this will accomplish the goal of scalability that Bitcoin faces. The idea of the chainweb is derived from early Bitcoin forums that were never executed. Another important thing to mention is that Dr. Stuart Haber(a Kadena advisor) was the most cited author in Satoshi Nakamoto’s 2008 white paper, fascinating.
Figure B
3. Kadena Funding/Collaboration
Kadena held and raised money a few times throughout its inception, raising a total of ~$15 million. All funds were raised through a SAFT, which doesn’t disclose the number of tokens sold or the token price. Kadena has prominent investors like CoinFund, Multicoin Capital, Origin Capital, ChainFund Capital, Susquehanna International Group, and more. The structure of the token sale was done strategically, in my opinion, which may* limit the SEC from taking enforcement actions against Kadena LLC. Will Martino, who is one of the co-founders of Kadena used to work at the SEC for 27 months. His background at the SEC and the way they raised money at Kadena may* save them from the SEC’s overreach. Kadena also collaborated with USCF on the use of Blockchains in the Investments Space. Additionally, Kadena is live on Amazon AWS and Microsoft Azure for entities to evaluate, build and deploy blockchain solutions at no cost.
Figure C
Token Information-
Tokenomics
$KDA is the native token for the Kadena blockchain. Currently, the circulating supply is 198,047,245 with a max capped supply of 1,000,000,000 tokens according to Coingecko. The token $KDA is used for paying out miners for mining blocks on the network, similar to Bitcoin. $KDA is also used to pay transaction fees on the network. The supply breakdown of the initial supply is referenced in Figure D(below). 23% of the initial supply is allocated to investors and the remaining 77% was allocated to founders and the project. Regarding the supply schedule, the difficulty of mining will increase as more blocks are mined. The full breakdown may be found here.
Figure D
2. Mining $KDA
Taking a look at $KDA’s hash power gives us a sense of the security of the network and miners’ confidence. Over the past year alone there has been an increase of 1200% in hash power. More and more people want to be involved in the network as it may* lead to gains in the future. If you wish to mine $KDA then you can follow the guide here. In short, you can buy $KDA miners that are plug-and-play on amazon via ASIC miners. At the time of writing, the most efficient miner is the Goldshell KD MAX according to f2pool which costs about $12,000.
Figure E
Additional Information-
What’s Next?
Kadena recently announced a $100M Grant Fund to Support Early-Stage Builders per Coindesk. This fund will help support founders and entrepreneurs who build on the Kadena blockchain via grants. This grant allows for strategic components like (1) Research and Development to architect the Kadena infrastructure more simply for real-world applications. (2) Create an incubator for hands-on technical developments to advance builder skills and ideas. (3) An Accelerator that empowers startups to scale. (4) Venture offering that allows strategic growth and operational expertise to propel companies using or pivoting to Kadena’s blockchain vision. The Kadena ecosystem at the time of writing has 120 different projects listed which are expected to grow with this grant. Kadena Grantee named EucLabs manages an updated ecosystem for Kadena.
Figure F
2. Technical Analysis
Before sharing the current price action, I wanted to reflect on when I first discovered $KDA. Below are two tweets from mid and late 2021 briefly discussing why I was bullish on $KDA. At the time of the tweet, $KDA was around .39 cents(left photo)! My initial target was $20 since there was not much price action. As the momentum was being lost, I believed the top was in as altcoins tend to have quick explosive uptrends. Shortly after, per the right photo, you will see that $KDA has topped out at ~$28 concluding its 5th wave. $KDA appeared to begin a higher degree correction.
$KDA has had a sensational run from $.05 all the way to $28 yielding ~477x+ returns. Ever since $KDA hit all-time highs, we have seen the price fall towards a high time frame demand zone (blue box) that should act as a support region. Price is likely to consolidate in or near the blue box before making a new move. The way the correction subdivides will give hints on how the next move plays out. Bottom structures typically take a long time to form and reverse when the bears are exhausted, so it’s best to stay patient for a clear structure. However, it is possible that we may not hit the blue box so one should prepare for any scenario.
Figure G
Conclusion
I think is pretty clear and evident that Kadena has a strong team and the CEOs also have great technical backgrounds. Being that Dr. Stuart Haber(a Kadena advisor) was cited many times in Satoshi Nakamoto's whitepaper is a strong statement on its own. Additionally, Stuart Popejoy and Will have strong technology and legal backgrounds from their previous work experiences at JPMorgan and The Securities and Exchange Commission. It leads me to believe that Kadena has thought out all features needed that a fully functional and a soon-to-be more adopted blockchain has. I am also excited to watch what projects the Kadena grants will reel in over time. I believe that the ecosystem is set up to explode over the coming years due to how diligently the team has been working. Lastly, while I am very bullish on Kadena, it doesn’t mean it's correlated to the value of the $KDA.