Over the past few weeks, Kala’s Advisory Team has been taking the necessary steps in moving Kala from a ERC20 token to building its own blockchain. Building Kala on a Bitcoin fork provides a wide variety of benefits to our Kala community.
Increased Stability and Protection with the SEC
In 2017, the cryptocurrency market came under intense scrutiny from many governments and the SEC in the United States. The SEC has been taking steps toward defining which ICOs and cryptocurrency tokens should be considered securities, thus requiring security regulation. Due to its simple design build, several ERC20 tokens are currently under investigation and may receive regulatory or legal action. Moving from an ERC20 token to a unique blockchain establishes Kala’s utility and value as a cryptocurrency, not a security.
Increased Validity and Opportunity within Crypto Exchanges
In response to SEC involvement, many cryptocurrency exchanges have adjusted or are currently adjusting the requirements coins/tokens must meet to be listed on their exchange. Several ERC20 tokens have recently been pulled off the world’s top exchanges. Since Kala will no longer be an ERC20 token, it is more appealing to exchanges, making the path to being accepted that much easier. Once Kala gets on crypto exchanges, its currency value can begin to take off.
More Favorable Structure for Distribution through Proof of Work
As one of blockchains biggest catalysts and revolutionaries, Bitcoin’s primary purpose is to be a distributed and trustless network. Bitcoin is built on a Proof of Work mining method, conferring rewards in the form of the coin being mined to those who solve complicated mathematical algorithms that verify transactions. This design gives every person the opportunity to mine Bitcoin.
Ethereum has announced their plans to move from Proof of Work to a Proof of Stake system, conferring awards to miners based on how much stake, or ownership, they have in Ethereum. A drawback to this type of mining is that it concentrates control based on how much a person currently owns. When the power in the system moves toward a select group who already have more than others, that undercuts the whole idea of decentralization.
Kala believes in the power of decentralization and the opportunity that it offers for everyone who wishes to participate, rather than select groups. In that way, Proof of Work is a better fit.
Putting the Kala Community in the Driver’s Seat
Operating on its own blockchain gives Kala users the ability to directly support and build the Kala ecosystem through mining or installing the Kala blockchain on their own hardware. This gives our users a personal impact on the strength of Kala’s network and its ability to be effective within Kala’s ecosystem. The Kala network then becomes just as valuable as its token. Each person who mines Kala increases the strength of Kala’s network, creating a truly decentralized network that belongs to and is powered by our Kala community.
Simplifying Kala’s Blockchain Design
Since Bitcoin has been around for almost 10 years, there are hundreds of supporting tools already developed and in use. Moving to a fork of Bitcoin increases the ease of adoption across multiple platforms, such as wallets and exchanges, which are already set up for bitcoin and its forks. This makes Kala easier to use, with wider access.
But, the benefits and opportunities don’t stop here. In the coming weeks, Kala’s Advisory team will release new updates and information about how Kala’s blockchain network will be built.
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