KAVA is the native token of Kava.
Kava is a DeFi lending platform designed to allow users to earn high returns on its cryptocurrency by lending it out and using it as collateral for stablecoin loans. Kava’s native stablecoin is USDX.
How to buy KAVA
Follow these steps to purchase your first Kava.
- Compare crypto exchanges
The easiest way to buy Kava is from a cryptocurrency exchange. Use our comparison table to find an exchange with the features you want such as low fees, ease of use or 24-hour customer support.
- Create an account
To create an account on an exchange you will need to verify your email address and identity. Have some photo ID and your phone ready.
- Make a deposit
Once verified, you can deposit HKD using the payment method that best suits you – Bank transfer, debit card, wire transfer and credit cards are all widely accepted.
- Buy Kava
You can now exchange your funds for Kava. On easier-to-use exchanges, this is as easy as entering the amount you want to purchase and clicking “buy.” If you like you can now withdraw your Kava to your personal wallet.
Where to buy KAVA in Hong Kong
Compare exchanges that list the KAVA token on things like payment methods, fees and features.
A step-by-step guide to buying Kava
Want to buy Kava? Follow these simple steps:
Step 1. Create an account on a cryptocurrency exchange that allows you to trade KAVA
Compare exchanges that support KAVA, then determine if the exchange you choose supports buying KAVA with Hong Kong dollars (HKD), Bitcoin (BTC) or Ethereum (ETH). You’ll need to provide your email address and create a password to register for an account.
- Note: It’s also recommended that you set up two-factor authentication to provide an extra level of security.
Step 2. Deposit funds into your account
Many cryptocurrency exchanges only allow trading between cryptocurrencies and don’t allow the direct deposit of fiat currency, such as HKD, so you’ll usually need to own or buy BTC or ETH first.
- Note:The exact process for depositing funds into your account varies depending on the exchange you choose.
Step 3. Buying KAVA
The final step is to trade your chosen currency for KAVA on the exchange. Once again, the exact process you need to follow may vary slightly depending on the exchange you choose.
Which wallets can I use to hold KAVA?
Unless you’re looking to place a trade, storing cryptocurrency in an account on an exchange is not recommended. Instead, it’s generally much safer to store your KAVA in a secure wallet.
How does Kava work?
Kava’s purpose is to allow people to lock up cryptocurrency as collateral, similar to other Ethereum-based DeFi projects. One of its key differentiators, however, is that it leverages the interoperability features of the Cosmos network to allow a wide range of cryptocurrencies to be more easily used as collateral.
In a nutshell, the cryptocurrency deposited into Kava collectively becomes the collateral for USDX stablecoins, which are pegged to US$1. The network is over-collateralised, giving people assurance that the USDX stablecoin can always be safely redeemed for $1 of value.
There are two basic things a user can do with Kava:
- Lock crypto collateral in a smart contract to withdraw USDX
- Stake (lend) USDX to earn interest
These can be combined, though, and can interact with other DeFi projects to be greater than the sum of their parts. For example, someone could take on a leveraged position by taking out a USDX loan and then using that to buy even more cryptocurrency.
|Circulating supply (approximately, as of August 2020)||27,000,000|
|Purpose||Governance, collateral, validator staking|
What does the KAVA token do?
The KAVA token serves three purposes:
- Governance. KAVA token holders can exercise governance rights on the Kava platform.
- Lender of last resort. If all else fails, KAVA can start being liquidated to help guarantee successful USDX redemption.
- Validator staking. The top 100 validator nodes on Kava’s network can earn staking rewards in KAVA.
Key factors to consider when buying KAVA
All cryptocurrency purchases should be carefully evaluated due to the volatile nature of digital assets. The fundamentals regarding both the project and the associated token should be considered.
KAVA token holders are the ‘lenders of last resort’ for the Kava platform. If the value of locked collateral falls too quickly and positions get liquidated, the KAVA token is minted and sold to cover the difference.
The process of minting and selling KAVA tokens to the market could lead to a drop in its value. The increased supply will effectively devalue the KAVA already in circulation. It is an inflationary factor to consider when holding KAVA and is the reason why the token has no cap to the maximum supply.
As KAVA tokens provide governance rights on the platform, it is in the best interest of KAVA token holders to use that voting power actively and wisely. By keeping the platform running smoothly, token holders can help to mitigate the need to mint further KAVA tokens. Although token holders can mitigate against smaller market movements, significant market crashes cannot be accounted for.
How to sell KAVA
To sell the native KAVA token find a cryptocurrency exchange that it is listed on. This could be a centralised or decentralised exchange. You will then need to follow a similar process to that depicted in Step 3 above. Select the cryptocurrency, stablecoin or fiat currency you would like to exchange your KAVA tokens for. Once you have found an exchange pairing you are happy with, look for the ‘Sell KAVA’ button and enter the amount you wish to sell.
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