KAKI No-Loss Options — an Ultimate GameFi Protocol on Arbitrum&BSC
KAKI is a no-loss options protocol, a GameFi project deployed on Arbitrum. KAKI makes players Play to Earn and is currently in public testing. This article will give you a better understanding of KAKI, starting with the following three questions:
1. Why will KAKI have a crucial impact on DeFi?
2. Why did KAKI choose the more complex solution — Arbitrum in the first place, instead of other more easily deployed scaling solutions such as BSC?
3. When will KAKI go live on the mainnet?
The biggest highlight of KAKI is No-loss. Why is it No-loss? Generally speaking, there are three aspects: no loss for traders, no loss for Layer 1 funds, and no loss for market makers.
First of all, no loss for traders — No loss of capital, trading with interest.
Traders pledge their token into the KAKI protocol to form ktoken. KAKI put those token into the lending protocol such as compound to generate interest and aggregate weekly interest into a bonus pool. These interest earnings are expressed in KC, which players use as chips to participate in options trading on a given day of the following week.
The percentage of the prize pool you win = KC you win/KC everyone wins
KC=KDAI*T (T: Time) means that the more money you deposit and the longer you deposit, the more KC chips you will receive. It also means you have a better chance of winning more prizes. At this point, I’m sure you get the idea that KAKI is not only for the big players with millions of dollars but also for the long-tail users with small amounts of money. In KAKI, players don’t have to worry about losing their capital, yet they can use the interest as principal and participate in the game to earn bonuses.
But what if I’m not good at trading, or I don’t have time to trade?
Not even a problem! This comes to the second highlight of No-loss games — team trading. In the KAKI universe, the captain plays on behalf of the members of each team, that is, placing orders. You can join a team as a crew member and supply your captain with bullets by pledging DAI. The bonus won by the captain after keeping the commission for himself, and the rest is distributed to the crew in proportion to their funds.
Thus, if you follow a captain with excellent trading skills, your earnings will be much higher!
The third highlight of the No-loss trading game — combine with GameFi and NFT.
KAKI airdropped a captain NFT to every internal tester. On the mainnet, if you want to become a captain and recruit crew members, you need to deposit a certain amount of USDT and have the captain’s NFT. The more crew members are recruited, the faster the entire team obtaining KAKI tokens! Sounds interesting, isn’t it? Since the number of captain NFTs is scarce and has great utilities, these captain NFTs will also have a relatively good investment value.
Next, let’s talk about the No-loss of L1 funds.
KAKI puts users’ funds on Ethereum, and the funds on L2 are mapped assets. The security of Ethereum is self-evident, so if Arbitrum is attacked, the funds on Ethereum can be guaranteed to be safe. Someone in KAKI’s discord community asked why KAKI did not choose BSC in the first place, but Arbitrum. Here you can see KAKI’s mission to put the safety of users’ funds as our priority.
If there are two ways in front of you, be sure to choose the harder one.
Because in the Defi world, there is never an easy way to guard the safety of users’ funds. — KAKI
Finally, let’s look at the No-loss of the market maker.
It requires a bit of popularization of a concept, that is, the WMM-DDH mechanism pioneered by KAKI. This may sound a bit unfamiliar to you. As we all know, option pricing is influenced by four factors: price, volatility, time, and rate. Of these, time and rate are beneficial to market makers. And the rise and fall of the token price and volatility may cause losses to market makers.
Most options programs do not or cannot fully address hedging issues, but KAKI’s unique mechanism effectively addresses these issues. WMM-DDH is a unique hedging mechanism in KAKI European options that reduces market maker risk to almost zero, thus ensuring no loss of market maker capital.
KAKI expects to start the audit in August and go live on the mainnet in September. The testnet has opened to the public. Everyone is welcome to experience it and provide us with some interesting comments here: https://docs.google.com/forms/d/e/1FAIpQLSeI4JLERGYkiOutu8bDYrccLSAuHNUo5sVlnSB8s_KN29De0A/viewform?usp=sf_link
This post is quoted from *defiworld with modifications.
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