Auctions are coming to DEFI, Kujira

Can you imagine being able to buy tokens at a discount and get between 5% to 10% profit on each operation in a simple, intuitive way and with minimum risk. Read this article to the end and I will explain it to you in 5 minutes.

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In DeFi there are already several tools that give us a certain advantage over investors who take more risks, currently there is a project that was launched on the TERRA network and wisely (after the abrupt fall of this network), migrated to the COSMOS network thanks to the ease of integration as a protocol in this network to be born with the same programming language. This move is also very strategic, since it has allowed them to connect directly with the rest of the projects built on the COSMOS network, CRONOS, KAVA, SENTINEL, SECRET, PERSISTENCE, JUNO or EVMOS among many others.

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This project is Kujira. Thanks to its new product ORCA, allows all investors/speculators to participate in a different way in which the market offers good opportunities to make time and capital profitable, but as a rule and competitive advantage, BOTS and Programmers were almost the only ones who swam placidly in these generous waters, knowing how and when to act, taking advantage in advance of the operations that were going to happen. ORCA democratizes access to returns through third party settlements, thanks to a clear operation and a simple interface.

The basis that gives meaning to the use of ORCA is its stable currency USK, this stable currency is overcollateralized at 150%, keeping the PEG stable to the dollar 1:1 using a stability mechanism identical to that used by the successful stable currency DAI. The advantage that USK has over DAI and other stable currencies, is that its collaterals are not censurable, unlike DAI where we find that its major backing is with the stable UDST. Right now USK can be created by depositing ATOM and soon it will be possible to do it with DOT and KSM. In the same way it will create a greater supply of bids by adding new collateral tokens, to acquire these at a discount.

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ORCA works by means of a totally transparent bidding system, and offers it to us in different percentages. Whoever is more conservative in the bidding to guarantee the price gets less discount, and vice versa, whoever risks more can get the best discount on ATOM.

The way it works is simple:

  1. A user or investor accesses Kujira Blue to borrow USK, for which he/she must leave ATOM as collateral.
  2. This user/investor then directly acquires a debt position with the USK currency issuing protocol.
  3. If the price of the ATOM deposited as collateral falls too low, and no longer supports the value of the borrowed USK, the user/investor is immediately liquidated.
  4. This liquidation guarantees the payment of the debt, guaranteeing the system has no delinquencies or outstanding debts to be collected.
  5. Trust is now linked to mathematics and cryptography, (aseptic concepts but full of value), and not to people.
  6. At that moment the ORCA bidding system comes into operation giving access to buy at a discount to each user/investor depending on the % he/she has selected to buy the settled ATOMs.
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A detail to take into account for the correct management of the platform and an optimal experience is to understand on the one hand the rate or fee of 0.5% charged when we proceed to withdraw the ATOMs purchased at a discount, on the other hand know how to select the best bid percentage based on the people who are already within that % and hand calculate the probability that we have of success by the times that historically the bid has been completed in a given percentage (it is worthless to be where it has never reached the settlement).

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Finally, bear in mind the risk involved in working with a recently launched stable coin. Not very liquid and untested in the battlefield, losing the PEG can plunge you into irrecoverable losses. Be aware also of the operational risk that exists if you understand this strategy as passive management, as that can bring you losses if the price of ATOM continues to fall and of the cost/opportunity that we are faced with by having liquidity standing still, waiting for a bid to be executed and you can buy at a discount if the market does not correct in 3 months.

As always DYOR….