Blaze (TMW): Welcome fellas on this glorious Wednesday evening. Very stoked to have you here with us and really looking forward to all the knowledge you are about to share.
Stuart Popejoy (Kadena): Thank you! We’re stoked to be hanging out here too!
Doug Beardsley (Kadena): Thanks! Excited to be here.
Blaze (TMW): I know you guys are helluva busy so without further ado, let’s get this AMA cracking. Let’s start off with an intro. Please tell us more about your backgrounds and your roles at Kadena?
I think this is gonna take a while as I am led to believe that you guys have some of the most impressive backgrounds in the space currently.
Stuart Popejoy (Kadena): Hi I’m Stuart! I’m the CEO of Kadena, and before that, I built the blockchain team at JP Morgan, been in tech for 25 years, and love blockchain and smart contracts. I’m the author of the Pact smart contract language — my cofounder Will is the inventor of the Chainweb scalable BFT protocol used by Kadena.
I’m also heavily involved in the Kaddex design, drawing on my 15 years of background in algorithmic trading systems.
Blaze (TMW): Wow, that is truly impressive especially coming from such a lauded company as JP Morgan.
Doug Beardsley (Kadena): I’ve been in the software business for close to 18 years. Over that time I’ve worked in defense, security, finance, and in a few startups building frontend and backend web apps. I’ve been programming Haskell professionally for 11 years which is what led me to meeting the Kadena team. Now I’m Kadena’s Director of Engineering and love working with the talented team of engineers we have.
Blaze (TMW): Equally as impressive, damn, Kadena really does have the best guys building it all out. So for those poor souls that have no idea what you do, please give us a little rundown on what Kadena is all about and what can we do with it?
Stuart Popejoy (Kadena): In general, **our team exists to bring serious technology for scaling to blockchain **— serious from financial, from security, from regulatory, from engineering. It takes all of that to build the right system to settle all the world’s financial assets.
Doug Beardsley (Kadena): We’ve solved the elusive problem of scaling Proof of Work. In other words, we won’t be crushed by gas fees down the road as the transaction volume grows.
Blaze (TMW): I hear that besides this all-star team you have even more impressive advisors, namely Stuart Haber who is the most cited professor from the BTC whitepaper.
Isn’t there quite a large shift away from POW at the moment and why is your POW better than all other consensuses then?
Stuart Popejoy (Kadena): Kadena is the first and only scalable POW smart contract blockchain, and it has the safest smart contract language Pact.
With our multi-chain design, we will be able to not just maintain throughput without congestion, but scale financial markets with Kaddex to provide the kind of mature system seen in e.g. the US stock market multi-venue system. With gas stations, the problem of gas volatility vanishes, and users enjoy free transactions.
Doug Beardsley (Kadena): Along with solving the scalability problem we’ve also innovated in a number of other areas. For example, our smart contract language Pact makes it easier to write smart contracts with fewer bugs. And other decisions with core pieces of infrastructure will be a path to innovations elsewhere in the ecosystem as well. Things like safe transfers, native support for multi-sig, etc, which will ultimately make it easier and safer for the masses to own crypto.
Blaze (TMW): I suppose with Elon raising the greenness of POW being an issue, is your’s more energy efficient too? For the sake of education as we have many newbies that have joined of late. What are some key differentiators of Kadena vs let’s say ETH, DOT, SOL, EGLD etc?
Stuart Popejoy (Kadena): Ours is more efficient than Bitcoin and Ethereum by the linear factor of a number of braided chains. We are already 20x more efficient, and the Kadena Chainweb protocol can scale to unlimited graph sizes — for the same hashrate, hash for hash, you get 10x/100x/10000x more transactions.
Blaze (TMW): That’s a huge advantage already and I am sure you will tap into renewable energies to bring that carbon footprint down to a negligible amount
Stuart Popejoy (Kadena): POW’s big problem is inefficiency. With a properly efficient system, we can focus on managing impact from there, encouraging renewables along the lines of the Square paper, etc. But also, blockchain itself is still new, and POW is the only proven secure consensus.
Blaze (TMW): Yeah a decade isn’t a lot of time really. Still youngblood so to speak. Can you elaborate more on why your POW is so more efficient than current offerings?
Stuart Popejoy (Kadena): It makes for a way better token too. $KDA is not implicated in the security of the platform so you can leverage it with confidence. With POS you entangle the token and apps on the platform.
Doug Beardsley (Kadena): First of all, the claim that PoW doesn’t scale in terms of energy/transaction fundamentally misunderstands the way PoW works. More transactions don’t require more energy. Just because Bitcoin uses a lot of energy doesn’t mean that it has to. Secondly, if you’re absolutely dead-set on looking at the flawed metric of energy/transaction, we win there because we can scale.
As Bitcoin uses more and more energy the number of transactions it can process stays the same. But with Kadena, we can scale up our transaction capacity. So we can tap into energy efficiency that the other networks can’t.
Stuart Popejoy (Kadena): If your DEX (Decentralized Exchange) is a CLP (Continuous Liquidity Pool) and is secured with the platform token, and you’re POS, you have a security problem AND a liquidity problem. With POW, KDA offers supreme liquidity and will never be drawn into a security-vs-liquidity shootout.
Blaze (TMW): Didn’t realize that, can you break it down a bit simpler for us why that is the case?
Stuart Popejoy (Kadena): It’s just if your DEX is predicated on massive liquidity, and you’re running a proof-of-stake with the same token, you’re creating a huge incentive to divert capital from staking and into bonding/lending/AMM’ing on the DEX. Which of course is touted as a feature — “too big to fail”. Crypto isn’t that big yet, so attacks are likely.
Doug Beardsley (Kadena): Also…POS really isn’t decentralized at all. It’s a group of stakeholders holding keys that control the network. Sounds a lot like central banks to me. See https://medium.com/@factchecker9000/nothing-is-worse-than-proof-of-stake-e70b12b988ca for more information.
Blaze (TMW): In a way, you are right but isn’t it the same for POW, where a conglomerate of miners can run a monopoly?
Doug Beardsley (Kadena): That article says it pretty well. “PoS is permissioned by internally held tokens owned by a central party that can deny entry to independent external parties.” With Proof of Work, existing parties can’t deny anyone the ability to participate in the network.
In my opinion, decentralization is not about the size of the group running things. It’s really about whether participation can be denied to newcomers by the existing entities with power. By that definition, PoS is not decentralized.
Blaze (TMW): Will definitely have a read once we are done then.
Partnership-wise, I see you have had a rather exciting new partnership with Torus. What do they bring to the table that strengthens Kadena’s offering? While you are at it, what other partners do you have helping Kadena achieve what it set out to do?
Stuart Popejoy (Kadena): All of our recent partnerships are about making the user experience on Kadena shine, whether that’s Torus wallet for in-browser,
Francesco (Kadena): Torus is an extremely user-friendly wallet that will make signing transactions seamless for our dApps. The simplicity of signing in with Google and other well-known SSOs combined with Kadena’s gas stations will deliver a familiar experience and open the realm of possible apps that can be deployed on a blockchain.
Blaze (TMW): Probably get annoyed by this question but what sort of fees and TPS are we looking at using Kadena? The old TPS questions.
Stuart Popejoy (Kadena): Fees are easy: none! Gas stations + no congestion means never having to even think about gas as a user.
Doug Beardsley (Kadena): Here’s a little infographic we have covering some actual stats on transacttion fees paid during the testing phase of our upcoming DEX.
Blaze (TMW): Wow, that is top-notch, leads me straight into my next question then. How does Kadena derive revenue to sustain itself? Token wise, why do we need KDA and what can we do with it?
Stuart Popejoy (Kadena): Well, Kadena is unique in that, in addition, to being the core project, we’re also heavily invested in helping other projects, like Kaddex, bring mature apps to Kadena. So, in addition to the tokens, we have exposure to other newly-issued tokens.
It’s a good question too. A lot of people think gas prices drive Eth. I’m not denying it but wow what a dumb driver. Fees don’t really drive BTC.
Doug Beardsley (Kadena): The answer to transaction fees is scalability. And we’ve got that 🙂. But hey, don’t take it from me. This is widely agreed upon by the industry.
Stuart Popejoy (Kadena): Also, managing gas risk will become a mature commodity infrastructure, as ideally gas should be transacted in a stablecoin.
Blaze (TMW): That makes a helluva lot of sense. Having a token fluctuating in value is absurd as a measure for gas fees.
With regards to the rest of the year, what does Kadena’s roadmap look like and what are you most excited for?
Stuart Popejoy (Kadena): With Kadena, apps handle gas, so they can manage that risk invisibly for the user.
Gas is a real issue, and killing even BSC now, so we know POS isn’t a magic wand there. You have to actually scale, not just launch with fast finality and a high TPS.
Blaze (TMW): You are right, it started off swimmingly but even they are feeling the pinch of tx volume increasing
Stuart Popejoy (Kadena): For instance, with KDA, we’re launching a bridge relay secured through bonding, where stakers can take risks to earn up to 30% APY. This puts a secure, decentralized foundation under our platform integrations with Ethereum, Celo, Terra. We expect bonding to be massive and oversubscribed, so that will lock up a lot of KDA 🙂!
Blaze (TMW): Well, this is sounding like a very strong buy to me for our community. All this and you are sitting at $72m market cap and what you have achieved thus far is reminiscent of a multi-billion cap.
Doug Beardsley (Kadena): I’m obviously super excited about our bridges like Stuart mentioned. But I’d also like to add that I’m excited about the ecosystem improvements we’re working on that will provide the building blocks for third parties to create more powerful and user-friendly tools for the end-user. We’re working on the unsexy things like indexers, APIs, data accessibility, etc. These things probably don’t sound sexy to the average user, but what we’re really trying to do is empower more developers to build apps that we haven’t even thought of yet.
Stuart Popejoy: Yep, the vision is industrial scale. You don’t do that by “running on a laptop” 😁.
Blaze (TMW): I would like to invite the community in now but before we do, anything you would like to cover before we bring in the frothing community?
Doug Beardsley (Kadena): We’re building a platform. And like Steve Ballmer said
…developers developers developers…developers developers…
Blaze (TMW): and Forrest Gump said, then I developed some more. An old adage to his running scene
Stuart Popejoy (Kadena): Yes, it’s really exciting all the new developers coming to Pact. It makes Pact better with users asking for features and learning about our token standards. ****Our new NFT standard is actually a “poly fungible” token, where you can even do fractional ownership of assets alongside series, etc.
We are launching an NFT marketplace for a truly decentralized ecosystem. Users will be able to both launch new NFT schemes and benefit from existing NFT ledgers in the same place.
Babu 6: About your ecosystem, can you tell me what security system do you have to guarantee privacy and protection to your users? Low liquidity is one of the main problems with the DeFi, Project what are you going to do about it? Do you have a liquidity provider program? What benefits for liquidity providers?
Stuart Popejoy (Kadena): Liquidity is the single most interesting aspect of DeFi, but you have to have a scalable platform, otherwise the risk associated with gas spikes and congestion translates into massive exposure. So Kadena solves that with scalable POW, but also with an approach to multi-chain liquidity in Kaddex that incentivizes market makers to rebalance liquidity across chains.
Cross-chain (multi-venue) liquidity is actually a meaningful way to reduce volatility risk within the DEX, so this will provide a platform to experiment with circuit breakers even. The point is, MMs will be compensated not just for liquidity but for providing stability to the market.
Chapito: What are the advantages of Pact smart contracts using formal verification? How does Pact intend to detect and remove critical errors in contracts?
Doug Beardsley (Kadena): With formal verification, you can prove things about your program for all possible inputs. This is something you simply can’t do with the traditional approach of writing tests. We’re thrilled that Pact puts powerful formal verification techniques into the hands of average developers for perhaps the very first time. Pact is already very readable on its own. It’s not Turing-complete so that adds another dimension of safety. And formal verification comes in and adds value on top of these things.
Here’s an example of our formal verification happening live
A bug like this would be very difficult to find in practice. Even more so if you’re depending on code written by other people. But Pact’s formal verification will even take the code from other contracts into account to prove properties about your contract.
You might say that this kind of thing proving something about negative numbers is too simple. But it’s totally relevant to financial code where a negative sign is the difference between depositing and withdrawing!
Max: Hey I been in KDA for a while, The wallet seems a bit complicated to many. What plans do you haveto solve them, When there will be cross-chain transfers applicable to exchanges?
Stuart Popejoy (Kadena): Well that’s where today’s Torus announcement, our upcoming Ledger integration, and a lot of work behind the scenes on signing APIs (like what Doug was talking about) means that users will have a convenient and safe way to do sophisticated transfers without the blank-check approvals you have to give to Uniswap and friends.
There’s ever more frauds, flashloan attacks and such on DeFi these days so having a secure, multi-sig Kadena signing integration is coming to every wallet.
Amina Peter: Why you have not announced your mining algo despite being a PoW blockchain network? You claim to be the first open-source smart contract language with Formal Verification (FV), but Tezos provides Formal Verification too, is it different from yours? Or are there things I don’t understand pls clarify?
Doug Beardsley (Kadena): We announced our mining algo along with launch. We use the Blake2s hashing function. Our mainnet has been live for less than two years and we already have two companies manufacturing ASIC miners for Kadena. They’re also very profitable right now!
Doctor Strange: How many wallets do your project support? Would you build your own wallet? 👀
Francesco: Here are our currently available wallets: https://www.kadena.io/chainweaver. We also just announced today an integration with Torus, stay tuned to see it in action with Kaddex!
Infoplus: Back to KADENA Q3 Roadmap. Collaboration between Kadena Polkadot and KadenaDOT Exploration. Why did you choose Polkadot? Why not choose a cross-chain security protocol in Defi? Indeed, Polkadot is cashing in fast and BSC is on-trend. Do you have any plans to join another chain? Are there any plans to add your project to various blockchains in the future?
Stuart Popejoy (Kadena): We didn’t choose Polkadot, they chose us 🙂 . There aren’t a lot of truly portable smart contract languages — for instance, Solidity, you bring all the warts of Ethereum with it — and that’s why we integrated pact into the Cosmos platform as Kadenamint. So really, Pact will be on every smart contract platform that matters. This is separate from our direct partnerships and integrations on the financial side where we bring assets over, and Polkadot is further down the line there — Eth, Celo, Terra come first.
Blaze (TMW): Anything last you would like to add fellas? Of course please feel free to drop all the essential links. So our community can dive deep at their own leisure.
Francesco: Please be sure to follow us on:
You can also subscribe to our newsletter for in-depth updates on our project.
Stuart Popejoy (Kadena): Just great to meet the Moonwalkers! Come check out Kadena and KDA and Pact and get involved! Crypto is really just getting started and we’re going to take it to the next level. Thanks for having us!
Doug Beardsley (Kadena): Thanks so much for inviting us. It’s always fun to get the opportunity to talk about this project that we’ve poured our hearts and souls into for the past several years.
Blaze (TMW): Thanks so much guys, really enjoyed it Top-notch breakdown of what you do.
That concludes the AMA. If you are interested in reading the AMA directly from Telegram, feel free to join TehMoonWalker’s Telegram and view the discussion starting here. To get announcements about Kadena’s progress in creating the best multi-platform DEX and DAO, follow us on Twitter, Discord, Reddit, and Telegram.