Injective (19)

Injective was founded by Eric Chen and Albert Chon in 2018.

Features of Injective

One standout feature of Injective is its decentralized financial infrastructure. Injective offers tools that help developers build a wide array of DeFi solutions, from lending and borrowing protocols to futures, perpetuals, options, and spot markets.

One notable feature is the MEV (Miner Extractable Value)-resistant on-chain orderbook, showcasing that everything from simple buying and selling to advanced trading is possible on the blockchain.

Another key feature is cross-chain interoperability. Cross-chain interoperability refers to a blockchain's ability to communicate with other blockchains.

If users can move their assets (tokens) from one blockchain to another, the blockchain is said to be interoperable, and Injective fits this definition.

It is interoperable with Solana, Ethereum, Cosmos, and many other blockchains.

Furthermore, Injective uses CosmWasm, a technology that enables the seamless creation of cross-chain smart contracts.

Smart contracts are programs that run on blockchains, and this feature enables decentralized applications (dApps) on Injective to operate across other blockchains.

The Injective Hub is the gateway for interacting with Injective. It consists of six components:

Wallet

Bridge

Governance

Auction

Staking

Insurance Funds

Wallets allow users to monitor their assets on-chain. However, this is limited to tokens native to Injective or those bridged from Ethereum, Moonbeam, or other IBC-enabled chains.

The Injective Bridge enables hassle-free movement of assets and data from Injective to other blockchains like Ethereum. It supports:

1. ERC-20 tokens (tokens on the Ethereum blockchain)
2. Arbitrary data transfer (not limited to assets)
3. IBC, enabling bridges with IBC-enabled blockchains, opening the door to assets from multiple chains.

Some blockchains that Injective can bridge with include: Polygon (Wormhole), Kujira (IBC), Migaloo (IBC), Noble (IBC), Oraichain (IBC), Secret (IBC), Solana (Wormhole), Andromeda (IBC), Arbitrum (Wormhole), Axelar (IBC), Celestia (IBC), Cosmos Hub (IBC), and others.

Injective, as mentioned, is a community-based blockchain

Hence, holders of the INJ token have a say in the network and can propose changes or modifications

To propose a change, one must hold at least 10 INJ, and to vote on it, the proposer must hold at least 100 INJ

For a proposal to be executed, at least 33.4% of all token holders must vote, and 50% of the votes must be yes. Otherwise, the proposal is rejected, and the deposited tokens for governance are refunded

On certain occasions, tokens can be burned if the minimum deposit requirement isn't met or if 33.4% of the total vote is NoWithVeto

Injective's burning mechanism is dramatic. Users are invited to bid on a basket of assets that come from revenue generated by participating applications and users.

The auction works like an English auction, where individuals bid different prices, and the highest bidder wins the basket of assets.

However, all the $INJ deposited in the auction is burned, meaning Injective reduces the supply of $INJ while distributing assets.

Staking: As with other blockchains, staking involves users depositing $INJ tokens to participate in transaction validation. They can do so either directly as validators or indirectly by delegating their tokens to validators.

Insurance Funds: Since Injective’s development infrastructure allows for a variety of financial solutions, those building derivatives markets need to deposit $INJ tokens to limit socialized losses.

Injective’s API nodes serve two main purposes within the ecosystem:

1. Data Layer: They provide applications with real-time data from the Injective blockchain.

2. Transaction Relays: They enable gasless transactions, as the application can cover the gas fees for the user via fee delegation, making the user experience smoother.

While decentralized exchanges (DEXs) are the most popular dApps on Injective, the ecosystem is expanding rapidly. Other dApps include but are not limited to:

Insurance protocols

Prediction markets

Binary options and other financial products

Injective uses a consensus mechanism called Tendermint-based Proof of Stake (PoS). To simplify:

PoS (Proof of Stake): Validators stake their $INJ tokens to secure the network, validate, and add validated blocks to the chain. The higher the value of the staked tokens, the higher the probability of being selected to validate and propose a block.

Tendermint adds an extra layer of security to PoS by addressing the Byzantine General's Problem, making the consensus mechanism more Byzantine Fault Tolerant (BFT).

A blockchain that is BFT can continue to operate even with some malicious nodes. However, if too many nodes become malicious, it disrupts the blockchain's activities.

In short, validators stake $INJ and propose blocks. Other validators vote on the proposed block in two rounds. If the block gets a two-thirds majority in both rounds, it is added to the chain, and the proposer earns rewards.

$INJ is the native utility token of the Injective ecosystem. It is used for:

• Governance, allowing holders to vote on proposals.
• Staking: Validators stake $INJ to secure the network.
• Gas fees: Paid in $INJ for transactions.
• Derivatives trading: Many assets are traded in relation to $INJ, boosting its liquidity.

As of the time of writing:

• Price: $21.55

• Market Cap: $2,105,458,831 (#42 globally on CoinMarketCap)

• Circulating Supply: 97,697,857 $INJ

• Total Supply: 100,000,000 $INJ

• Fully Diluted Market Cap: $2,155,071,663

Binance, Pantera Capital, Jump Crypto, and Mark Cuban are some of the prominent investors backing Injective.

2018:

• Injective gets a big start with assistance from Binance.

2019:

• Injective creates an on-chain orderbook and on-chain derivatives.

2020:

• Injective gets funding from Pantera Capital.
• $INJ is released.
• Injective’s first testnet, Solstice, is released.
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2021:

• Q1: More testing; Equinox PoS testnet launched.
• Q2: More funding from Pantera Capital and Mark Cuban.
• Q3: Injective Hub and the multichain Injective Bridge are launched. Injective releases tools for institutions to connect.
• Q4: Mainnet is launched, and IBC is added.

2022:

• Q1: Injective Bridge V2 is launched. CosmWasm testing begins.
• Q2: Binance connects directly to Injective's mainnet.
• Q3: Brevan Howard and Jump Crypto invest; CosmWasm smart contracts and Binary Options are launched.
• Q4: Wormhole Bridge is added, and fiat on-ramps are enabled, allowing users to buy $INJ directly with fiat currency.

Injective is not just another blockchain—it is a complete ecosystem designed specifically for decentralized finance (DeFi).