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Kine is a decentralized protocol which establishes general purpose liquidity pools backed by a customizable portfolio of digital assets. The liquidity pool allows traders to open and close derivatives positions according to trusted price feeds, avoiding the need of counterparties. Kine lifts the restriction on existing peer-to-pool (aka peer-to-contract) trading protocols, by expanding the collateral space to any Ethereum-based assets and allowing third-party liquidation.
Entering into the Kine ecosystem, what does the experience lifecycle look like to a typical user ?
To stake assets in Kine Finance dApp, user will have the "Staking Value" increased and get "Debt Limit", which can then be minted into kUSD as actual debt to the system. For every USD worth of "Debt Limit" , up to 0.8 kUSD can be minted. The 20% haircut here is set for liquidation buffer.
After minting, the kUSD can be transferred into Kine Exchange as trading margin. All trading gains and losses will settled in kUSD. kUSD can be bought or sold on popular decentralized exchanges such as Uniswap and DODO.
To withdraw the staking asset, user need to pay back the outstanding debt by burning equivalent amount of kUSD.
Kine promises to periodically distribute rewards to all users with outstanding debt. When there are rewards distributed, user can effectively claim them.
In Kine ecosystem, there are several major roles in play.
- Stake crypto assets and mint kUSD to receive KINE rewards, which are composed of trading fee distribution and token incentives .
- Passively bear the liquidity pool's exposed risk, profits when traders take loss as a whole and vice versa.
- Trade on Kine exchange, enjoy zero slippage, leveraged cross margin trading experience on crypto + non-crypto assets.
- Pay trading fees which are ultimately rewarded to stakers.
- Pay back MCD debt by kUSD on behalf of insolvent stakers.
- Help protecting the liquidity pool from under-collateralization.
- Cease an amplified portion of staked assets upon successful liquidation, which can be realized into immediate profits.