One of three platforms developed on the Synthetix protocol to realize the ambition to dominate the derivatives niche on DeFi. Let’s find out the details What is Kwenta? and the development potential of the project in the following article.
What is Kwenta
Kwenta is decentralized derivatives exchange with the AMM model developed on the Optimism ecosystem (Optimistic roll-up Layer 2 on Ethereum). Thanks to being built on the Synthetix protocol, Kwenta can provide a variety of derivative assets from tokens to traditional financial assets such as Forex, gold, silver,…
Kwenta Products Offered
Spot Trading
Although it is a derivatives exchange focusing on the Futures niche, Kwenta also supports users to trade spot directly on its application. Ask for a favor Integrates with 1inch aggregatorspot buying and selling on Kwenta is relatively easy with a variety of tokens, fast transaction speed and quite reasonable costs.
Futures Trading
As a Futures exchange developed directly on the Synthetix derivatives liquidity platform, along with choosing L2 Optimism as the destination, Kwenta inherits the following great advantages:
- High leverage: Kwenta provides traders with leverage up to x25.
- Instant order processing: Kwenta allows traders to open and close positions at high speed with almost no delay with low gas fees (advantage of L2 optimism).
- Abundant liquidity: Kwenta ensures deep liquidity for traders that is not inferior to CEX exchanges, this is possible because Kwenta is built on Syntetix and has the ability to use this platform’s deep liquidity pool.
- Asset diversity: Kwenta does not stop at Crypto tokens, this platform is gradually updating more traditional financial assets to help users have more investment options.
- UX optimization: Kwenta gradually equips tools to help traders easily invest starting with simple functions such as placing limit and stop orders.
In addition, when trading Futures on Kwenta, users can choose Cross Margin or Isolated Margin similar to CEX exchanges, this helps traders more easily manage assets when investing.
Staking & Earning
Kwenta encourages token holders to stake tokens to implement project DAO voting governance. In return, stakers will receive a reward of inflation tokens (Currently estimated APY ~97%)
In addition, users can provide liquidity to Arrakis pool wETH/KWENTA on Uniswap v3 and stake LP tokens at Kwenta to enjoy a portion of the pool’s transaction fees.
Development Roadmap
Currently, Kwenta has not announced the 2023 roadmap. The project items proposed for 2022 have all been completed, especially the V2 version with many improvements to help optimize profits for Traders. Maybe in 2023, when the platform is relatively complete, the development team will focus on building trading support tools to improve the UX of the project.
Core Team
The Kwenta development team has not been announced, however, according to unofficial sources, the people on this team all work at Synthetix.
Investor
In early 2022, Kwenta held a crowdfunding round and raised an estimated $6.9M. In addition, the project was also granted 900,000 $OP by Optimism during Optimism Summer to deploy community marketing.
Tokenomics
Overview information about Kwenta token
- Token Name: Kwenta Token
- Ticker: KWENTA
- Blockchain: Ethereum
- Token Standard: ERC-20
- Contract: 0x920cf626a271321c151d027030d5d08af699456b
- Token Type: Utility, Governance
- Initial Supply: 313,373
- Total Supply:
1,009,409.43
Token Allocation
- 30% – Synthetix Stakers
- 5% – Early Synth Trader
- 5% – Investment
- 25% – Community Growth Fund
- 15% – Core Contributors
- 20% – Kwenta Treasury
Token Emission
The amount of KWENTA tokens issued in the first week is 14,463.37 $KWENTA, the number issued will gradually decrease towards the milestone. 200 $KWENTA (1% APY) after approximately 4 years from the start of token issuance.
In addition, the token inflation portion will be divided equally at the rate of 60% for $KWENTA stakers, 20% for Treasury and 20% for trading incentives. All inflation tokens will be locked for a maximum period of 1 year. The sooner you vest, the less number of tokens you will receive.
For example: You are paid a bonus of 1 $KWENTA. If you vest immediately, you will only receive 0.1 $KWENTA, but if you wait 1 year to vest, you will receive 1 $KWENTA.
Token Use Case
Currently the $KWENTA token is used for:
- Voting DAO project governance.
- Provide liquidity at Uniswap v3.
- Pay incentives to trade on the platform.
Exchanges
You can trade KWENTA at Uniswap v3.
Kwenta’s Information Channel
- Website: https://kwenta.eth.limo/
- Twitter: https://twitter.com/kwenta_io
- Discord: https://discord.com/invite/kwentaio
Summary
Hope this article has partly helped you understand What is Kwenta? It can be said that Kwenta is one of three key products along with Lyra and Thales that giant Synthetix focuses on developing with the purpose of expanding its derivative asset ecosystem in the DeFi space. Currently, Kwenta is only focusing on perfecting the product, so there is not much to evaluate about its ability to compete for users with other projects like dYdX or GMX. However, with the advantage of being the “offspring” of Synthetix, Kwenta will be a formidable competitor to any competitor in the Perpetual Exchange industry.