The Kadena blockchain went live on mainnet Monday.
Formally called Chainweb, Kadena’s blockchain is a proof-of-work (PoW) network similar to bitcoin.
But where bitcoin struggles with processing large transaction volumes, the Kadena network attempts to solve the problem of limited scalability by weaving multiple PoW blockchains together to run concurrently. In doing so, the Kadena network is able to handle large transaction volumes and other types of heavy data-processing loads.
Founded by Stuart Popejoy, the former blockchain lead at investment banking giant JPMorgan, and Will Martino, the lead engineer for JPMorgan’s blockchain prototype, Juno, the project was first unveiled in 2016.
“This is the first time anyone has ever scaled proof-of-work,” Martino said in an interview with CoinDesk, adding:
“We are believers in proof-of-work. We believe it is a proven protocol and the key feature we needed to fix was [transaction] throughput.”
Currently, there are a total of 10 PoW networks in Kadena. This number could increase via system-wide upgrades in the future.
In 2018, the Kadena team raised a total of $15 million to launch their public blockchain from notable investors such as Multicoin Capital, Coinfund and Devonshire, the private investment arm of the owners of Fidelity Investments.
“Kadena is the only team in the world that presents a credible solution for scaling proof-of-work systems. That’s the exciting thing about it,” said Multicoin Capital managing partner Kyle Samani.
At present, token transfers and smart-contract development are not enabled on Kadena. Martino noted the full network will support transactions and decentralized application (dapp) deployment on Dec. 5.
“The only thing you can do with mainnet release for the first month is mine,” said Martino.
Outside of mining, Kadena is also hosting its third token sale starting tomorrow Nov. 5 until Nov. 22.
Hoping to raise an additional $20 million, Martino explained that the token sale will be accessible for prospective investors – accredited and non-accredited – strictly through token launch platform CoinList.
In reality, there are two token sales running side-by-side on CoinList for Kadena coins.
There is one for non-accredited, non-U.S. investors in which interested parties who don’t wish to mine for Kadena coins can buy their token assets for $1 per coin. For the first 40 days of the sale, investors will be restricted to trading and exchanging their purchased Kadena coins exclusively on CoinList. Thereafter, the coins will be freely tradeable.
The other token sale is being executed as a Simple Agreement for Future Tokens (SAFT). That sale is open to accredited investors only, either within the U.S. or abroad. However, in accordance with the guidelines of a SAFT sale, these coins will be locked for a period of one year.
In return, accredited investors are able to purchase Kadena coins at a discounted price of 50 cents.
This dual structure for Kadena’s token offering is a configuration meant to ensure regulatory compliance of the sale in the U.S. and abroad.
“It’s going to serve Kadena and the community long-term because we’re going to have done this sale within the bounds of existing regulations, case law and securities law,” said Martino.
It should be noted, however, that other SAFT raises have resulted in scrutiny and emergency action from the U.S. Securities and Exchange Commission in the past, with messaging app Telegram being asked on Oct. 11 to halt distribution of tokens sold during its SAFT sale.
Along with mainnet launch, Kadena is also announcing Monday the launch of its Kadena token wallet, called the Chainweaver wallet.
As opposed to simply holding and signing off on transactions, the Chainweaver wallet will most notably host a mini-server able to interact directly with dapps.
This means that on a desktop computer users can run dapps natively from the Chainweaver wallet.
“We needed to have a simplified journey from ‘I have some coins’ to ‘I can use some dapps,’” Martino said.
Additionally, Kadena is expected to host “community gas stations” where transaction fees generated by new users can be paid directly by the dapp developers themselves.
According to Martino, users don’t have to create their own cryptocurrency wallets to use applications on Kadena. Developers can do it for them and preload small amounts of Kadena tokens on these wallets.
Later, as users familiarize themselves with the application, they have the option to continue funding their wallets by buying Kadena tokens themselves either on an exchange or elsewhere.
As announced in May, Kadena is also partnering with asset manager USCF Investments to create new decentralized finance products on Kadena.
About the usability of the platform for dapp developers, Multicoin’s Samani said the incumbent smart-contract blockchain, ethereum, has faced “many challenges over the years” as a result of poor design decisions:
“It’s so much easier for application developers to build on top of this thing. … Kadena is designed to be developer-centric. This means that developers can build much higher quality, more usable applications.”
Team photo courtesy of Kadena