An Introduction to Kujira Protocol
Kujira Protocol is a team of builders on the Terra Ecosystem committed to levelling the playing field, with the ethos that everyone “Deserves to be a Whale”
Their mission to achieve this, as stated in their Litepaper is to
“Build tools that are easy and cost effective to use for everyone, from the novice crypto enthusiast to the seasoned retail investor, regardless of their chain of choice, without needing to risk more than they can afford to lose”
https://docs.Kujira.app/litepaper.pdf
Part of their plan to do this, is by opening the liquidation markets to normal people like myself, that do not have the necessary dev skills required to build & manage liquidation bots.
With their Orca app, its sexy looking UI & easy to navigate system, they unlocked the doors for anyone & everyone to bid & liquidate the various apex assets available on Anchor, such as bLuna, bEth & sAvax, with bAtom & bSol due imminently. There is also the recent addition of Mars Protocol liquidations as discussed here on Twitter:
https://twitter.com/teamkujira/status/1510934674763362309?s=21&t=h2fVIjkJJiSYtjfdjqJh6Q
The team also have audited contracts in place, to add new assets & liquidate on all EVM lending markets, with Karura & Acala networks already next in line, as stated here:
https://twitter.com/teamkujira/status/1510872567296544768?s=21&t=AeoqY1w3B2i43j-Id_VvOA
And by Acala themselves:
https://twitter.com/acalanetwork/status/1511782071039148038?s=21&t=XMbisIrIPKiGRd-_4xqo9Q
Since launch in November 2021, Orca has been giving people the opportunity to bid using either UST or aUST. The aUST bid mechanism allows bidders to earn 15% Anchor interest, with the remaining 4.5% paid to protocol stakeholders (more about staking later) & has been battle tested on the Terra network, liquidating around 5,300 bEth & 2.5 million bLuna in the process, for a combined sum of around $150 million (assets now worth around $308 million at current prices), whilst also acting as a backstop for Terra, slowing the liquidation process & preventing cascading liquidations, like we saw back in May 2021. Where, under the previous bot system, instant 30% liquidations were the norm, with the bots insta-selling & reloading to continue liquidating, causing constant downward pressure & increasing the risk of a death spiral.
The new system has not seen a liquidation greater than 13% & that was in the early days (Possibly occurring during the Anchor price oracle malfunction) with the past 2–3 months seeing the liquidation premiums failing to move past the 5% pot. This, coupled with most liquidated assets going to hodlers that are looking to increase their stacks, has reduced the sell pressure, with cascading liquidations looking increasingly unlikely.
This just reinforces my belief, that Orca is the backstop that Terra didn’t know it needed, till it rose up from the depths to patrol the bloody waters, giving the ecosystem an added layer of protection from death spirals & giving borrowers increased confidence to take greater risks (for bigger rewards), safe in the knowledge that their losses will be greatly reduced, as proven by the fact that we are still seeing liquidations happen, even at the peaks of the recent Luna ATH’s.
“Degen’s Gonna Degen”
Anyone that successfully bids on liquidations can withdraw the assets for a fixed fee of 0.5%, with ALL fees & protocol generated revenue, paid directly back to stakeholders. No hidden shareholders or fees, nothing is held back.
Anyone can become a stakeholder by buying Kujira’s native $Kuji token & staking/bonding it on https://Blue.Kujira.app to create sKuji. Each sKuji token represents a share in the protocols auto-compounding revenue pool, consisting of $kuji, the various liquidated assets used to pay fees & various other Terra ALTs used as fees.
There are also additional benefits to hodling sKuji as hodling 300 unlocks basic analytics tools, while hodling 5,000 grants full access to the premium dashboard and a plethora of historical information & predictive modelling tools designed to aid you in your bidding strategies.
And the last dApp but by no means the least is https://Beluga.Kujira.app
An app that the team developed, to send tokens to multiple wallets in one transaction, massively reducing the gas fees required. I know from speaking to the team, that this is one that they have high hopes & future plans for, and during token distributions that they conducted in January. They were sending tokens to 4,000 individual wallets at a time. The implications & use cases for this are astronomical & it is one that I am eager to see the direction they move with.
Truthfully, I had lost track of just how much this team has shipped since launch in Nov 21. They are constantly working on upgrades & additions. Reacting to the community & bringing innovation to existing markets. It was only when I started writing this analysis & trying to put into words how far the protocol has come in such a short period of time, that a lot of it came back to me.
This analysis has barely scratched the surface & I see a bright future ahead for Kujira Protocol & the team of shippors building it. They have built a good community on Telegram, full of giga brains, that while “not financially advising” each other, are an excellent source of information for those that pay attention.
Anyone wanting to learn more or ready “To be a whale” should explore their dApps or pop into the TG group below. The team are around night & day answering questions & engaging with the community.
Also, thanks to the team @ Anarchists on Terra NFT that gave me the inspiration to write this piece in the first place.
Check them out on: Twitter —
https://twitter.com/anarchists_nft
Or Discord —
*Disclaimer — I took part in both the Kujira early bird & public sale IDO & have a financial interest in the success of Kujira*
