Kernel Protocol is Now Live: Everything You Need To Know About the First Suite of Karak-Native LRTs
Kernel Protocol went live today on 5th July, introducing the first suite of Karak-native LRTs. For the first time, users can now restake ETH, LSTs, Eigenlayer-native LRTs, and USD-pegged assets on Karak and receive an LRT that can be deployed in further yield-bearing activities, whilst earning additional Kernel Points on top of your Karak XP.
This article outlines everything you need to know about how the protocol works and how you can start using it:
What Is Karak?
Karak is a restaking platform similar to EigenLayer, except that it allows users to restake not just ETH and LSTs but almost any asset, including ETH, LSTs, LRTs, a variety of USD-pegged assets, BTC and more. This gives it a much larger addressable market than EigenLayer. With over $1bn of TVL already accumulated, in the first 2 months since launch, Karak’s current trajectory is on track to eventually match or exceed EigenLayer’s $20bn.
What Problem Is Kernel Protocol Solving & How Can You Use It To Optimize Your Restaking Yields?
Currently, whilst users can restake almost any asset on Karak to earn additional Karak XP, once it is restaked it remains illiquid for deployment in other yield-bearing DeFi activities, with Karak receipt tokens not deployable on any DeFi app that requires liquidity.
By introducing Karak-native LRTs, Kernel Protocol makes restaked Karak assets liquid so that they can then be deployed in the full range of yield-bearing DeFi activities, including yield markets, lending markets, leverage markets, perps platforms and more. This solves the liquidity problem and allows Karak restakers to further amplify their yields, making Kernel Protocol the end game for liquid restaking. Moreover, whilst your assets are restaked via Kernel Protocol, as well as Karak XP, you will earn additional Kernel Points.
What Are The Different Kernel Protocol LRTs & Which Assets Can I Use To Mint Them?
Initially, there will be 3 different types of Kernel Protocol, Karak-native LRTs. The LRT you mint will depend on which type of asset you wish to use as collateral. The 3 LRTs and the associated collateral types are:
ksETH: Mintable using LSTs including:
- wstETH
- rETH
- swETH
- axpETH
krETH: Mintable using LRTs including:
- weETH
- ezETH
- pufETH
- rsETH
kUSD: Mintable using USD-backed assets, including:
- USDC
- USDT
- USDe
ksETH and krETH arebacked 1:1 by ETH-pegged assets ensuring it maintains its value and kUSD is likewise backed 1:1 by USD-pegged assets.
How Do I Mint ksETH, krETH & kUSD?
Mint ksETH here.
Mint krETH here.
Mint kUSD here.
For each asset, simply connect your wallet, select the collateral asset you wish to mint, select the amount, approve the respective K-Asset contract, then press “mint”.
How Do I Provide LP To The ksETH, krETH & kUSD Liquidity Pools?
You can provide LP to the respective pools by following the links on the Points Boost page of the Kernel Protocol website.
What Rewards Will I Earn When Restaking On Karak Via Kernel Protocol?
Whilst the underlying assets for ksETH, krETH, kpETH, kUSD are restaked on Karak via Kernel Protocol, they will accumulate:
- Karak XP (Karak’s native points)
- Kernel Points (Kernel Protocol’s native points)
- A share of the aggregated yields generated by the underlying assets in their basket.
Meanwhile, you will be able to deploy your kAssets in further yield-bearing activities as Kernel Protocol builds out its network of utility partners. This includes a full range of lending markets, yield markets, perps platforms and leverage markets that Kernel Protocol has already lined up as partners.
What Are Kernel Points & How Are They Earned?
Kernel Points are distinct from Karak XP. They are run and operated by Kernel Protocol and act as a bonus on top of Karak XP to incentivize users to deposit into Karak via Kernel Protocol for boosted yield. Ultimately Kernels will be able to be redeemed for KERN, the native governance and utility token of the Kernel Protocol. A user’s Kernels will be displayed on the Kernel Protocol dashboard.
The primary way to earn Kernel Points is to deposit an accepted asset into Kernel Protocol to mint one of the Kernel Protocol assets (ksETH, krETH, or kUSD). You may also earn additional boosted Kernel Points by depositing your Kernel Protocol assets into a set of relevant LPs (e.g. ETH/ksETH or krETH/kUSD etc.).
For a full breakdown of how Kernel Points work and how the redemption process for future KERN tokens will work, visit:
You can check your Kernel Points balance on the Points page of the Kernel Protocol website.
How Do I Get Boosted Kernel Points
You can get a 1.5x Kernel Points boost by providing LP to the respective Kernel Protocol LRT liquidity pools. You can provide LP to the respective pools by following the links on the Points Boost page of the Kernel Protocol website.
Where Can I Deploy My Kernel Protocol LRTs To Earn Additional Yields?
There will be a variety of DeFi protocols where you can deploy your Kernel Protocol LRTs to earn additional yields. Initial partners will include yield markets such as Napier Finance and Spectra, lending markets such as Timeswap, leverage markets such as Airpuffs, and perps platforms such as GammaSwap.
Stay tuned as we announce the go live of each of these utility applications and more in the coming weeks. In the meantime, you can start boosting your Kernel points by LPing the LRT pools using the instructions above.
What Are KERN Tokens & How Do KERN Holders Benefit From Kernel Protocol?
At the heart of the Kernel Protocol ecosystem lies the KERN token. KERN tokens benefit from revenues accumulated by Kernel Protocol via a buy-back-and-burn mechanism. Buying KERN tokens therefore allows you to share in the success of the protocol as value-supporting buy-back-and-burns accumulate proportional to the growth of the ecosystem.
Protocol revenue on Kernel Protocol is generated by taking a 0.1% minting fee and 0.25% redemption fee on all kAssets.
Protocol revenues are distributed as follows:
- 80% of fees generated are used for buy-back-and-burns of KERN tokens to ensure the token remains deflationary and to counterbalance any seasonal airdrops.
- 20% of fees go to project operations.
Where Can I Purchase KERN Tokens
You can purchase KERN tokens on the Uniswap v3 Pool.
The contract address for KERN is: 0xD7fC610F6595b3aA6E24466b5cA166D10a0fbdcb
How Do I Migrate VEC/sVEC Tokens To KERN Tokens
Holders of VEC/sVEC tokens can migrate them 1:1 for KERN tokens by heading to the Migration page of the Kernel Protocol website and following thes instructions:
- Connect your wallet.
- Select “Approve” on the asset you wish to migrate.
- Refresh the migration page.
- Click migrate. This will convert your entire Vector asset balance into Kernel assets.
If you hold psVEC, simply unwrap your psVEC into sVEC and then do the above migration.
If you hold gVEC, then convert to sVEC or VEC on
How Do I Migrate vETH/svETH Tokens To krETH
Holders of vETH tokens can migrate them 1:1 for krETG tokens by heading to the Migration page of the Kernel Protocol website and following these instructions:
- Connect your wallet.
- Select “Approve” on the asset you wish to migrate.
- Refresh the migration page.
- Click migrate. This will convert your entire Vector asset balance into Kernel assets.Holders of svETH simply need to unstake their svETH into vETH and then do the above migration.
Can I Redeem My ksETH, krETH & kUSD Directly For Underlying Assets
Yes, you can redeemyour ksETH for ETH-denominated LSTs or ETH (as available), redeem your krETH for ETH-denominated LRTs or ETH (as available), and redeem your kUSD directly for USD-pegged assets.
To do so:
- Head to the ksETH / krETH / kUSD page on the Kernel Protocol dApp..
- Toggle from “Mint” to “Redeem”.
- Connect your wallet.
- Select the asset you wish to redeem into.
- Input the amount you wish to redeem.
- Press “Redeem”
- You will receive your Karak receipt token
- Use this on Karak to redeem underlying collateral and initiate withdrawal process.
Is there still a 3/3 Trading Tax On KERN Buys/Sells?
No. The 3/3 tax has been removed with the launch of the KERN token. KERN liquidity has been migrated to a 1% Uniswap v3 pool. KERN tokens from the LP fees will be burnt to help with deflationary tokenomics mechanics, whilst ETH fees will go to Kernel Protocol operations.
Contract Addresses
KERN Pair: https://etherscan.io/address/0x52701adac460d4a414ae5f96b619da3f73ed2833
krETH Pair: https://etherscan.io/address/0xeab1724bae42bdaa74cb2269f22db0a763e79969
ksETH Pair: https://etherscan.io/address/0xd992d160d0617cfba73a2d2abf098df4f630ed37
kUSD Pair: https://etherscan.io/address/0xf77c8ce2b0944505ee8aff5e5bd0f39c10f35c5c
More Coming Soon!
kAssets are just the beginning of an exciting new portfolio we’ll be rolling out shortly that will revolutionize the fast-evolving LRT market. Stay tuned for an exciting new asset we’ll be launching in the next couple of weeks that builds on the kAsset infrastructure to deliver even more exciting benefits to users in another first-to-market offering.
Meanwhile, we’ve got a packed roster of upcoming DeFi protocol partners that you will be able to deploy your krETH, ksETH and kUSD holdings on to amplify your yields and other exciting ways to boost your Kernel Points.
In the meantime, you can keep in touch with us and find out more about the project at:
Website / dApp: https://kernelprotocol.com/
Docs: https://kernel-protocol.gitbook.io/kernel-protocol
Twitter: https://x.com/KernelProtocol
Telegram: https://t.me/+oLJVNNOZPPs5MWI5
