On 11th Nov, we host an AMA with Aaron Choi-Kava labs Head of business development to talk about what benefits will HARD Protocol provide for the blockchain industry. For those who missed the AMA, here is the recap.
Intro
Aaron: HARD Protocol is the world’s first cross-chain money market for digital assets. Similar to Ethereum-based applications Compound and Aave, HARD Protocol provides users with the ability to lend, borrow, and earn with their digital assets. Unlike existing applications, HARD Protocol is built on the Kava DeFi Hub enabling it to uniquely provide money market services to non-ethereum assets such as major market cap crypto such as BTC, XRP, BNB, BUSD, and others.
How HARD Protocol works is simple, users can contribute digital assets they have into a pool upon which other users can borrow. To borrow from the pool, a user must first lock their own digital assets as pledged collateral to secure the loan. When repaying the loaned assets, the user also must pay interest to the pool of lenders in exchange for the service. In this way, suppliers of assets in the pool generate yields from borrowers on a pro-rata basis.
Also, each pool is allocated a certain amount of HARD token rewards. HARD is the governance token of the application responsible for deciding what assets get money markets, where fees go, and what rewards get paid in each pool. Both suppliers and borrowers earn HARD tokens for using the platform. In this way, HARD Protocol will be decentralized, governed, and maintained by its users.
There will only ever be 200M HARD tokens. Those who hold HARD will be able to direct the future of the platform (and accrue any future fees taken) however they desire.
HARD recently launched on Binance and Bitmax. We’re currently doing a Launchpool event with Binance, which will go on for a couple more weeks.
AMA begin
Q1: Can I redeem my Supplied asset anytime?
& Will I still earn tokens or it is just for Locking up?
Yes, you can redeem your deposits at any time as long as it’s not being used as active collateral for loans. You will also be earning HARD for providing liquidity into our protocol. The farming yields are available at our website hard.kava.io.
Q2: Can we withdraw our HARD tokens from Binance to Trust Wallet currently? Does the HARD address seem to be BSC on Binance meanwhile KAVA on TrustWallet? Are they compatible cross-chain?
Currently, Binance only supports BEP20 (BSC) tokens, but they are working to quickly support the Kava mainnet token format for HARD. Once that is opened, then Binance will become a defacto cross-chain source of swapping HARD across different chains.
Q3: Will you only offer centralized options for the staking (for the KAVA holders) or do you plan to offer some decentralized options as well?
We don’t have options on our roadmap at the moment. BUT we have partnered with Injective Protocol, who are building a decentralised derivatives exchange on Cosmos, which could very well provide this type of service.
Q4: How does HARD Protocol provide transparency and safety for their users and what sort of a reward structure is there for the token holders?
We have worked with Certik to provide audits on all our code across our platforms. We also have all our code open-sourced on GitHub at github.com/kava-labs.
Q5: Token burn is beneficial for any project, in being able to control the number of token circulation and to provide greater incentives to investors. Does HARD have a plan about token burn?
We don’t have any plans for token burns at the moment. The governance of the tokens via voting on proposals is most likely the best way to move forward with ideas like this, so this will rely on the users and holders of HARD to propose a plan on burning of tokens that would make sense.
Q6: If someone chooses the reduced rate incentives in return for the month lock-up period do the extra $HARD tokens get distributed between other investors earning HARD or get returned to the pot, thereby reducing the total amount distributed (i.e 40m allocated for KAVA stakers, if everyone chooses the month lock would the total being distributed remain at 40m or reduce to 13.3m)
The extra tokens get returned to the pot, which then lengthens the time that the total rewards will be distributed. ie, under 12month lockups, it is planned to be 12 months of distribution. If everyone chooses 1 month, then there will be a lot longer, up to 24 months more.
Q7: Where can we study about the staking options for HARD tokens? Looks like you have some monthly, half a year and yearly options, is the APY how highly dependable on those?
We have some documentation in our medium articles about the lockup for HARD rewards. But right now, there are 2 options, 1month and 12month lockup. If you choose a 1-month lockup, then you will only receive 1/3 of the amount than if you choose 12 months.
Q8: What are the ways that HARD generates profits/revenue to maintain your project and what is its revenue model ? How can it make benefit win-win to both invester and your project ?
HARD is a lending platform, and the way it would generate profits is from the difference between the lending and borrowing rate. In the beginning, there won’t be any profits as we will be focused on growth. But HARD holders will be able to propose proposals to increase profit margins and that will be determined by the vote results.
Q9: How much does HARD spend on the project? Where can the income come from for community training, market expansion, project development and building solid foundations?
HARD has been funded by the Kava team as of this moment. Now that we’ve released our token, we will be able to use some team/treasury tokens to be put towards development and marketing. All tokens are released according to our vesting schedule.
Q10: What type of Industry & user base is the $HARD project mainly focused on? Are you planning to establish partnerships with local cryptocurrency developers in each country to use $HARD more bang in the near future?
Initially, we are focused on the Binance userbase as we have a close relationship with them. This is also because the tokens we are first supporting are all Binance assets. We will also expand to other ecosystems and hope to work with centralized platforms as well as decentralized platforms.
For different countries, we will be working with our local communities to see what the different needs are and if we have the resources to support those groups!
Q11: When I connect to Hard Protocol using Trust Wallet, my assets automatically start farming, or do I need to transfer them to your address?
In order to start farming, you will need to deposit your assets into its respective pool on the Hard Protocol. You can connect to app.hard.kava.io to deposit KAVA, HARD, USDX, BNB, and start earning HARD.
Q12: Are there any scheme of the Flash Loans protocol in Hard Protocol !!
Then which are their capabilities?
No, we don’t have any flash loan capabilities inherent to the HARD protocol, because Kava, as a Cosmos blockchain, is not a turning complete chain and does not support smart contracts inherently. In order to support flash loans, either Kava or another developer would need to create a module that would be implemented on the Kava blockchain protocol. This would require a governance vote as well as a thorough vetting of the code and other security aspects.
Q13: What are the main $HARD growth drivers of the future? What are the next steps you will take to increase demand for $HARD?
How can I get $hard now? Is there any presale?
The main growth drivers are the targeting of the specific userbase that has liquidity mining requirements to earn APY on their assets, as well as the user set that requires to borrow crypto in their trading strategies. Also, another driver is the types of assets supported by HARD and Kava. Having more assets that have high liquidity, users, and increasing HARDs AUM/TVL will also drive the growth of HARD.
You can acquire $HARD on Binance, Bitmax or on Pancakeswap (BSC). HARD is being traded on these exchanges currently. We did not do any presale of any kind of HARD.
Q14: There are lots of new protocols launching that is designed to bring non-ethereum tokens to ethereum via a bridge. Is this something as a lending service you are looking forward to?
Cross-chain is definitely the future. I hope that all assets will be transferrable across any chain with atomic swaps supporting infinite cross-chain pairs analogously like how Uniswap supports any type of token swaps on eth. I’m looking forward to seeing Cosmos support a new era of cross-chain operations as well as the growth of Polkadot as well.
Q15: As far as I know, the first name of Hard Protocol was Harvest. So why did you change the name and rebrand to HARD Protocol? Is there a main reason for this rebranding?
We decided to rename our protocol to HARD for 2 main reasons. one was because of the recent DeFi project hack on Harvest. finance, which has no relation to our HARD product. They got hacked for quite a lot of money and we decided that it would be prudent for us to rebrand as to not have any confusion with them. Another reason is that our token was named HARD all along, so it made sense to align the name of our token to the name of our protocol
Q16: Why should I invest in your token? do you give me a guarantee that I’ll be profitable?
Do you own research before investing in HARD or any other token? We WILL NEVER guarantee any profits or price growth of our token, as we aren’t in the business of guaranteeing the future. We ARE in the business of building a profitable platform and ARE transparent about the steps that we are taking to do so. We believe that the best steps we can take to build our company.
Q17: We will be able to borrow and lend through Kava without the need for HARD. So what is the role of the HARD protocol?
You can only borrow our stablecoin USDX via Kava CDP. But you will be able to lend and borrow any coin that has a pool supported by HARD protocol. You won’t be required to have HARD in order to use the HARD protocol, but as a holder of HARD, you will be entitled to vote on proposals that determine the direction of the development of the protocol.
Q18: Is the rewards distribution of HARD automatic, meaning that the KAVA token holders receive HARD as rewards without any additional steps such as the need to press some claim button?
In all the ways of earning HARD via rewards, there will always be the need to claim the rewards. The claiming of the rewards starts the clock on the unlocking of the tokens, as all reward HARD tokens have a 1month or 12month lockup period, which is chosen by the user.
Q19: One of the articles mentioned that borrowers
funds will also receive a hard token as a reward. The question is whether it will be possible the amount of these tokens to cover the commission for borrowing funds?
Yes, once borrowing is available, there will be rewards set towards that area of usage. It could be quite possible that the rewards given to borrowers outweighs the cost of borrowing the funds itself. But I expect in an efficient market for that gap to be closed over time. In any case, early adopters will benefit from these high APYs, so I suggest to keep abreast of our developments and get in first whenever that is available!
Q20: Why is your solution better than wBTC, renBTC?
For Bitcoin, we will be building our cross-chain wrapped bitcoin solution in multiple steps. Firstly, we will be building a fairly centralized wrapping system, and then we will move towards a more decentralized multi-sig system. Each step will go through rigorous testing and security checks as we want to make sure things are as safe as possible. There are no solutions that exist for wrapped BTC outside of the ETH ecosystem so we would be one of the first ones to do that.
I think being one of the first to create a non-eth wrapped BTC solution for Cosmos would be quite monumental. This would be the start of allowing BTC to be used within the Cosmos ecosystem and would allow more use cases for BTC users that otherwise would not have those options.
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