What Is Klaytn? All You Need to Know About KLAY

What Is Klaytn?

Klaytn is a public blockchain with an emphasis on the creator economy, GameFi, and the metaverse is called Klaytn. It was formally launched in June 2019 and is now expanding its global business.

These business expansions are supported by the Klaytn Growth Fund, which aims to grow the ecosystem built on Klaytn. The Fund is managed and disbursed by the Klaytn Foundation, a non-profit organization based in Singapore established in August 2021.

History

Klaytn blockchain was developed and launched in June 2019 by GroundX, the blockchain subsidiary of Korea’s largest mobile platform, Kakao. After two successful years in Korea, the Klaytn Foundation, a non-profit dedicated to the Klaytn network and its ecosystem, was formed to begin Klaytn’s global expansion.

Klaytn Foundation is a non-profit organization created to promote global adoption and ecosystem maturity on Klaytn. The fund manages the Klaytn Growth Fund and operates in conjunction with Krust, a subsidiary of internet giant Kakao that invests in projects built on Klaytn.

How does Klaytn work? Customizable layer 2 solutions and IBFT

The Klaytn cryptocurrency has a series of unique characteristics. The network offers a metaverse package that includes custom layer 2 solutions, smart contract libraries, blockchain explorer, crypto wallets, bridges, and oracles, in addition to an ecosystem of supporting services such as NFT marketplace, stablecoin integration, etc.

These tools make Klaytn an aggregator for those who want to create something in the metaverse, such as crypto play-to-win (P2E) games.

Klaytn uses a technology called Istanbul Byzantine Fault Tolerance (IBFT) as its consensus algorithm, which allows transactions on the network to be completed within a second. This allows for use cases where a near-instant final transaction can be useful, such as real-time NFT minting for dropped items in a video game.

Klaytn supports the Ethereum Virtual Machine (EVM) as part of the Metaverse and Web3 development work. The network adopts the EVM specification by making its technical stack equivalent to the Ethereum stack, building on existing Ethereum clients, and enabling Ethereum Improvement Proposals (EIPs) and Improvement Proposals Klaytn (KIP) contributes to both ecosystems.

Klaytn crypto has a unique governance structure known as the Board of Directors (GC). Consisting of businesses and Decentralized Autonomous Organizations (DAOs) around the world, GC members form a network of validators that can deliver the benefits of a decentralized public blockchain while maintaining the performance of a centralized, permissioned blockchain. Klaytn plans to become more decentralized by adding additional DAOs in the future.

Klaytn’s Features: from a Metaverse Developer Pack to:

End-to-end Metaverse Developer Pack

To simplify metaverse construction, Klaytn provides an end-to-end metaverse package that includes custom L2 solutions, SDKs and smart contract libraries, IPFS solutions, wallets, and more. , chain explorer, oracles, and bridges, as well as an ecosystem of supporting services such as stablecoin integration, NFT marketplace, TradFi interface, and more.

One Second Accuracy

Klaytn uses an optimized version of the Istanbul BFT that allows transactions to achieve absolute precision in a second, enables a responsive user experience, and allows fields use cases that require near-instant and immutable finality, such as real-time minting of in-game items. There’s a small chance that a transaction recorded on-chain could be rolled back. This makes these blockchains unsuitable for mission-critical applications, especially if used at scale. Klaytn’s IBFT consensus algorithm ensures that the data recorded on the blockchain is correct and will never be reversed, to provide the reliability and data consistency needed for large-scale applications.

Ethereum Equivalent Support

Klaytn EVM support is one of the emerging standards for Metaverse and Web3, and will adopt the EVM specification in:

• Making Klaytn’s technical stack equivalent to the protocol Ethereum stack interface and runtime view
• Ethereum-based now has client and interface libraries to inherit any enhancements to their open-source codebase
• Enable advanced recommendations Ethereum (EIP) and Klaytn Improvement Proposal (KIP) to contribute to both ecosystems

Their unique view on decentralization is their Governing Council (GC). Comprised of leading global companies and DAOs across all geographies and industries, these GC members form a compact validator network capable of delivering the benefits of a public blockchain. decentralized while maintaining the performance of a permissioned blockchain. In the future, Klaytn aims to further enhance decentralization by integrating more DAOs into their GC to create a “DAO of DAOs”.

Integrated Scalability through Service Chain

Klaytn uses a hub-and-pin model widely recognized as one of its primary scalability solutions. Klaytn’s spokes or service chains can be customized for specific DApp requirements such as high throughput, special node configurations, or custom security levels. Additionally, support for nested service chains will provide the exponential scalability needed for widespread metaverse adoption.

$1 Billion Protocol Level Ecosystem Fund

Through a combination of the initially issued KLAY reserves and the newly minted 66% KLAY on-chain reinvestment tokens, Klaytn has set aside $1 billion in total to support the growing ecosystem. Funds are distributed across a range of grants and awards programs such as:

• Klaytn Innovation Reserve (KIR) for infrastructure, tools, and services to improve Klaytn’s network quality
• Increase Klaytn Leader (KGF) for projects that have the potential to make a positive impact on Klaytn
• Proof of Contribution (PoC) program to reward smart contract builders who contribute to the development of Klaytn on-chain operations on Klaytn.

Preferred Enterprise-Grade Blockchain

Klaytn is the preferred blockchain for enterprises and enterprise-grade use cases, including industry giants such as Japan’s GMO Internet Corporation, Indonesia’s Salim, and mobile game giants Netmarble and WeMade among their partners Klaytn is also the official blockchain partner for the Bank of Korea CBDC project, running a private, modified version of Klaytn.

Klaytn BApp Ecosystem

Klaytn, on the other hand, refers to its service chains as blockchain applications, in contrast to other blockchain systems that refer to their hosted services as decentralized applications (DApps) (BApps).

According to the Klaytn website, BApps are referred to as “first-class citizens in Klaytn’s world” because they are not required to run decentralized web services on the service chain, unlike on other host blockchains. Because of this, beginners have the option to use the POS consensus mechanism.

As part of a number of steps to promote growth in Klaytn’s BApp ecosystem, the first batch of BApps was released on the mainnet of Klaytn in June 2019. These programs included Klaytn Horizon, which welcomed programmers from all over the world to create apps on Klaytn, and the Klaytn Hackathon, a virtual hackathon that allowed programmers to create valuable projects on Klaytn’s public test net. In both situations, candidates were assessed based on their capacity to provide useful services and a straightforward blockchain experience. From a $1 million USD prize fund, the 2019 Klaytn Horizon tournament winners won cash prizes.

Regardless, Klaytn’s public mainnet and its blockchain-enabled transparency and security can be advantageous to both centralized and decentralized BApps. For context, these BApps were formerly known as ISPs and, as of 2020, there were roughly 12 dozen of them on the Klaytn mainnet.

Klaytn Improvement Reserve (KIR)

The Klaytn Improvement Reserve, or KIR, is the platform’s incentive system via which developers or users who significantly advance the network can get compensation.

In particular, the KIR protocol can be used to reward members of the governing board who make proposals that will help the network as a whole or, perhaps, improve its user experience.

Additionally, KIR gives partners the ability to quickly and predictably integrate cutting-edge smart contract-based applications.

Ozys, a Korean blockchain service business that created the Klaytn Swap decentralized token swap mechanism, was the first partner to receive funding from the KIR. Additionally, new capabilities have been created for Klaytnscope, a multipurpose block explorer that keeps track of block activity on the Klaytn platform. In addition to compensating enterprise ecosystem contributors with KLAY through its Proof-of-Contribution (PoC) evaluation mechanism, Klaytn is presently looking into ways to apply PoC to encourage and compensate the platform’s end users.

Klaytn’s Governance Council

Being an enterprise-focused blockchain platform, Klaytn has given a number of large enterprises and organizations the majority of the operations relating to the improvement and activities within the ecosystem.

Members of the governing council are global companies and organizations. As a result, the council members are able to vote and suggest changes to the platform’s and its node network’s performance.

More specifically, the council members are now in charge of ensuring the expansion and improvement of the healthy ecosystem of the platform.

Klaynt’s Use Cases

The goal of Klaytn is to provide a broad development path that enables various stages of blockchain development for a wide range of use cases. Blockchain is primarily being introduced to businesses through Klaytn Blockchain.

It provides services to businesses of all sizes, both small and large. The main goal was to give them the opportunity to connect their technological foundation to a blockchain network.

Additionally, through Klaytn’s ecosystem, the supported firms benefit from a public and private blockchain. Since the network’s private blockchain functionality ensures discretion, many users favor this platform. Additionally, it ensures the highest level of protection for critical data, enhancing the network’s ability to scale.

In the meantime, the ecosystem of Klaytn’s public blockchain enables data decentralization and ensures that governance is distributed. It provides the necessary components for the platform to be as scalable and user-friendly as feasible.

Klaytn Ecosystem

One of the crypto ecosystems that is actively growing is the Klaytn one. On the network, hundreds of third-party services are being developed. According to Binance Research, 11 million users were reportedly attained in June of last year. A staggering 267 partners in the DeFi, NFT, and gaming industries are mentioned in the most recent ecosystem summary on Twitter.

The Klaytn and Ground X teams, who began in Korea, want to reach markets outside of Asia. The network is prepared to form collaborations in a number of blockchain-related industries, including enterprise and entertainment services and solutions as well as custodial and non-custodial wallets, oracles and bridges, liquidity protocols, and DeFi.

In the image below, you can see a wide list of notable projects that are included in Klaytn’s Ecosystem, built by creatives, studios, and enterprises who are realizing their metaverse dreams on Klaytn.

Source: Klaytn’s Twitter

What Is the KLAY Token?

The KLAY token, which is the native token of Klaytn, is primarily used to transfer value inside the network or to pay transaction fees within Klaytn. KLAY is a utility token in this way, allowing us to pay for the advantages and power that Klaytns and its Services Chain have to offer. KLAY can only now be issued in the amount of 10.782.297.981 KLAY, which was issued in the genesis block. However, if the project’s decentralized governance decides to do so, the emission could be raised. KLAY is an inflation-type token, according to this.

On the other hand, KLAY is essential to the project’s finance scheme. As there are 9,6 KLAYs minted with every new block, there will be 300 million KLAYs produced annually. This is the same as 3% yearly inflation. The following predefined ratio determines how these bonuses and commissions are distributed:

• Bounty from Klaytn Ruling Council or Block Proponent: 34%.
• Klaytn Growth Fund (KGF): 54%.
• Klaytn Enhancement Reserve (KIR): 12%.

By doing this, the community’s growth is preserved and additional growth opportunities for the platform are promoted. Due to Klaytn’s Proof of Stake architecture, nodes are created by staking. 5 million KLAY tokens, which are equal to $5,1 million at the time of writing, are required to create a Klaytn node.

Roadmap: Klaytn 2.0

Klaytn is being rebuilt into a metaverse-scale blockchain platform. Here are the improvements and modifications in store for the upcoming two years:

Support for Ethereum Equivalence

Coordination and open source standards will be essential to Web3 and the metaverse. The EVM, which is unmistakably becoming the norm of many blockchain ecosystems, has a road forward thanks to Ethereum equivalency. In order to achieve this, Klaytn will adopt the EVM standard by:

• Making the technical foundation of Klaytn comparable to the current Ethereum foundation in terms of interface and execution
• Building on top of the open-source codebases of the current Ethereum clients and interface libraries to inherit any upgrades made to them.
• Enabling the contribution of Klaytn Improvement Proposals (KIPs) and Ethereum Improvement Proposals (EIPs) to both ecosystems

Scaling up Through Service Chains

As a scaling solution, Klaytn uses a hub-and-spoke design to preserve performance as our ecosystem expands. The “spokes,” which they refer to as Service Chains, may be customized to meet the needs of certain dApps, and much like other L2 solutions, they can be secured to the main chain by being anchored to it. As Klaytn scales up, they will:

• To increase support for the Service to enable seamless interoperability among users of our ecosystem, chain bridging is used.
• By adding more Service Chains and supporting infrastructure, they can size up our interoperable network.
• Implementing nested service chains will greatly improve scalability by enabling service chains to serve as hubs for other service chains.

Consensus Optimization

In a hub and spoke design, TPS improvements operate as a performance multiplier; for this reason, they will be optimizing our consensus process at the same time they seek to increase the TPS of our chains.

An Open and Developer-Friendly Environment

• A complete metaverse package with a collection of standardized contracts
• An ecosystem chain viewer for blockchain data retrieval and visualization
• SDKs for interacting with the ecosystem’s various parts, including the blockchain
• A free and open-source IPFS gateway for Klaytn’s metaverse, NFT, and gaming
• For easy assetization and asset commerce, there is an open-source DEX and NFT marketplace.
• A mobile and browser-based open-source wallet for interaction with dApp components and secure digital asset storage

Shift Towards Decentralization

A fundamental principle of the metaverse and the coming economy is decentralization. As part of the progressive shift towards decentralization, Klaytn, which firmly believes in this shared global vision, will update key components of the governance plan as follows:

• Creating a DAO of DAOs to oversee Klaytn’s fundamental development by having 30% of the Governance Council be made up of DAOs — the organizations of the future
• Removing the Gini Coefficient from the voting algorithm to increase the influence of DAOs in the Governance Council as they develop
• Modifying the governance council’s selection criteria to give preference to individuals who are dedicated to actively enhancing and expanding the Klaytn ecosystem

Expanding the Governance Council

In addition to the governance improvements, Klaytn will be adding more members to the Governance Council as part of its effort to further decentralize the Klaytn network.

• Addition of 50 members to the Governance Council, with an emphasis on bringing on board the leading DAOs
• Following network enhancements, the number of Governance Council members can double to 100

Is Klaytn a Good Investment?

Klaytn is a blockchain network that was introduced by a well-known telecom operator and is focused on enterprise solutions rather than strictly adhering to decentralization. Klaytn’s strategy of adapting its blockchain solutions for modern usage, its extensive collaborations with established businesses, and its support for enterprise blockchain technology have already shown to be successful.

The promising blockchain is now aiming to achieve its objective of seamless global blockchain adoption and provide lasting value to all members of its ecosystem.

How to Own KLAY

One way to own KLAY is to go through a centralized crypto exchange. The first step is to create a Gate.io account and complete the KYC process. Once you have added funds to your account, check out the steps to buy KLAY on the spot or derivatives market.

News on Klaytn

On October 21, 2022, the Klaytn team detected abnormal fluctuations in on-chain liquidity, and the decision was made to execute a market buyback of KLAY from the markets in order to stabilize Klaytn’s ecosystem.

The buyback is currently in progress and is being conducted as follows:

• Funds used for the buyback come from stablecoin reserves held by the Klaytn Foundation secured previously from strategic partners.
• The buyback is strictly limited to spot purchases directly from the market (CEX) and is being strategically executed to minimize market volatility.
• All KLAY purchased via the buyback will be burnt.

The decision to execute a buyback was made in order to manage risks derived from the actions of certain entities. The Klaytn team believes this was the right decision to make in our pursuit of a robust ecosystem.

Useful References

For the latest updates about the Klaytn, you can visit:

• Klaytn’s Official Website
• Medium
• Twitter
• Reddit
• Telegram
• Discord
• Instagram
• Facebook

Take Action on KLAY

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