The Mechanism of kmUSD
Kimah brings key solutions to the crypto world and solves
many problems in the whole ecosystem,
The stability mechanism of Kimah
its design model is hybrid and unique. The project reserves a portfolio of underlying assets, including Bitcoin, Ethereum and Hekas, through smart contracts as collateral for coins issued to operate its hedging strategy to prevent any decrease or increase in value. In addition, it is backed by a portfolio of crypto assets; this advantage makes the project more promising and secure.
Hedging-Method used in Kimah Stability-Mechanism
Kimah uses the hedging method to protect its underlying crypto portfolio and prevent risks from market crashes. Basic types of stablecoins usually use arbitrageurs/marketmakers or even shut down their whole system in black swan events and market fall, which is controversial and a significant risk for users using these types of stablecoins. But in contrast, Kimah uses a different approach to maintain a stable value for its reserved crypto assets.
Hedging cryptocurrency market works by opening a position (or multiple positions) that move in a different direction from your existing trade. The hope is that you’ll create as close to a net-zero balance as possible. While you could just close your initial trade and then re-enter the market later, using a hedge means you can keep your first trade on the market and make money with a second one.
