Ethereum’s high gas fees have made it impossible for the network to demonstrate its full utility.
Decentralized finance (DeFi) is booming. But despite the fact that Ethereum (ETH), arguably, the main accelerator of DeFi, achieved its goal of becoming the world’s most programmable blockchain, its widespread usage has also highlighted the network’s greatest weakness –– scalability. Congestion has become commonplace on the network, resulting in high gas fees, making it impossible for projects to run microtransaction payments on Ethereum.
Recognizing the limitations this presents, the DeFi space has actively sought out alternatives, with a direct correlation seen in the rising adoption of on-chain bridge technology. With this model, transactions on an expensive network like Ethereum could be routed through a cheaper network with a bridge, enabling cheaper transaction costs. The result is that the world might be introduced to a more efficient space with carefully crafted bridging technologies, one where once isolated blockchains are now connected to ensure use cases are not limited by network scalability.
A combined effort between KuCoin and the community built around KCS, their native token, addresses these efforts by creating a high-performance blockchain, KCC.
KuCoin exists as a well-known exchange recognized as an offering for the people. In comparison, the developer community of the KCS ecosystem originated with the KuCoin community and KCS holders. Together, these teams are putting their knowledge into releasing the KCS white paper.
The white paper outlines how high gas fees on Ethereum can be addressed through a larger ecosystem. In this ecosystem, several different projects and platforms, including DeFi, NFTs, games and Web3-related application projects, will be aggregated to increase the number of scenarios for KCS, the native token of KuCoin.
The release of the KCS white paper is also said to align the KuCoin core team, investment institutions, angel investors and other representatives in the community in the establishment of the KCS Management Foundation. These efforts will oversee the research, funding, investment and resource integration of KCS in developing new offerings that help deliver overarching project goals.
Moving to the multichain 3.0 ecosystem
The public blockchain uses the Proof-of-Staked-Authority (PoSA) consensus mechanism to reduce the block confirmation time. And while costs are addressed through the exchanges adoption of KCS as the on-chain gas fees. The result is that the team can provide community users with faster, more convenient and lower-cost experiences. It is worth noting that PoSA as a consensus algorithm will also improve security and stability.
In contrast to other public blockchains on the market, the KCC chain operates similar to Ethereum Virtual Machine (EVM) compatible chains. The public chain will be fully compatible with both EVM and ERC-20 smart contracts, ensuring migration costs of projects are low. However, when the KCS token is used for gas fees on the chain, costs will be further reduced, while the production of blocks every three seconds will ensure improved transaction confirmation times.
As the KCC blockchain develops, it will gradually move from EVM-compatibility 1.0 to 2.0, giving it utility in a multichain 3.0 ecosystem, with compatibility across different chains and assets. At this point, it will become crucial for the KCC blockchain to further focus efforts on creating infrastructure suitable for large-scale use and development, complete with intra-chain and inter-chain protocols.