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Those who follow the events in the blockchain industry know that the sector has been changing extremely rapidly. Each innovation seeks to solve an existing problem in the crypto world. Among them is the high gas price in the Ethereum universe.
Simplifying a purely technical question, we can see the gas price as the transaction cost on Ethereum. This price has been recording a high value for a long time. However, this issue largely depends on growing network congestion.
Today we will look closer at the Kaiba DeFi initiative. This project promises to find a stable solution to this problem through new technology. We will start from a fundamental premise on the Ethereum blockchain and then dwell on the proposal of the Kaiba DeFi founders.
Gas price and the promises of Ethereum 2.0
To better understand the value of Kaiba DeFi’s proposal, it is crucial to understand the current market situation. In 2020, Ethereum announced the development of the Ethereum 2.0 initiative, a highly promising evolution of the existing network.
To date, Ethereum users submit transactions with the required gas prices, and miners choose which transactions to mine in bulk. As a result, Ethereum gas prices are dynamic, with an equilibrium in constant fluctuation. In other words, they result from the meeting between the users’ offer and what miners accept regularly.
What changes with Ethereum 2.0? To put it simply: the system becomes proof-of-stake, with the phasing out of mining in favor of staking. This revolution will have stakers depositing ETH and competing for block prizes and gas commissions.
Moreover, each activity will have its own gas cost: direct sending of ETH (or an Ethereum ERC20 token) from one wallet to another will, therefore, become cheaper. The same argument also applies to the generic interactions between smart contracts, the processing of meta transactions, etc. To simplify, the cost of gas will vary according to the complexity of the on-chain activity.
The greater the number of transactions requested by users at any given time, the higher the gas prices will be. The Ethereum block space, in fact, gradually becomes scarcer. A transaction sent at higher gas prices will therefore result in faster processing.
The idea behind Internal Virtual Chains
At this point, any reader can understand the general hype over Ethereum 2.0 and its new features. However, we have not mentioned an essential aspect of this development: no one knows the exact project timeline yet.
We have seen the announcement of a series of projects offering Layer 2 solutions. However, these initiatives have disappeared from the radar or required a separate chain.
The first aspect we appreciate about Kaiba DeFi comes from this scenario. The project has an architectural design that places the beginning and the end of a transaction exclusively on the Ethereum Mainnet. The trick to achieving this result comes from using what experts in the industry call “Internal Virtual Chain” (or IVC).
You can think of an IVC as an internal protocol building a sub-chain within the Ethereum network. The end-users won’t notice the difference in transferring their tokens, as the whole procedure will, technically, never leave Ethereum.
Transactions on Kaiba DeFi entirely happen on the IVC system, a virtualization procedure providing gas savings close to 90%. This is the main change that the project aims to introduce in the blockchain sector.
Listing a project on Kaiba DeFi
Kaiba DeFi decentralized exchange lets users launch and list a new project on the system. However, Crypto pundits know that this procedure can be tricky and hard to complete, another issue that the new initiative aims to tackle.
Kaiba DeFi expects to be fully operative with its portal by December 2021. So far, the development is proceeding smoothly. Also, it will provide different ways to create liquidity on the DEX.
The developing team anticipates that managing a liquidity process on Kaiba DeFi will be highly functional. In other words, we expect no useless overcomplications in the procedure to let even inexperienced developers work smoothly.
Our conclusions on the project
The advantage promised by using this system is tangible and aims to solve a problem that has plagued the Ethereum universe for several years. Therefore, we can only promote this kind of initiative from our side, as they promise to improve the crypto experience of millions of end-users.
The project includes several stages of development, which we will be happy to monitor in the coming months. Anyone who knows more about the initiative can directly visit the official Kaiba DeFi website.
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