Kusama (KSM): cryptocurrency and project overview

Kusama is based on the same blockchain as Polkadot, and is essentially an early unaudited release of this project. The Kusama cryptocurrency ecosystem serves as a testing ground for new features before being implemented into Polkadot. Kusama is not just a test network, which are usually just playgrounds where tokens have no value. Being research and development oriented, and serving as a testbed for Polkadot, KSM tokens are a full-fledged digital asset traded on crypto exchanges.

KSM owners participate in blockchain creation, trusted node assignment and votes on system changes. Tokens are accepted as payment if a parachain needs to be connected, or a text message needs to be delivered.

Features of the Kusama Project (KSM)

Kusama is designed to solve two major problems faced by blockchain ecosystem developers:

Low scalability. Kusama’s open governance and secure networking system provides an off-the-shelf, scalable infrastructure on which enterprises, markets and decentralised applications can run and grow.
Interoperability. Kusama integrates multiple blockchains. Other development teams can create their own projects and connect to the shared network using Substrate.
Kusama exists through community support and will continue to operate as long as testing of the high-risk projects being prepared for deployment on Polkadot is necessary.

The stable and secure operation of the Kusama system is ensured by several groups of participants:

Builders – are responsible for creating the parachains, parapools and bridges needed to run the dApps. When programmers build decentralised applications on Kusama, they gain experience on Polkadot.
Network specialists – are responsible directly for the functionality of the network. They are divided into nominators, selectors, validators and managers.
Nominators – nominate validators from amongst network members in good standing.
Collators – collect transactions from parachay users and submit them to validators for processing.
Validators validate transactions and create new blocks. To become a validator, you need to pay a deposit. Kusama coins are accepted and are used to pay a fee for participating in supporting the project.
The managing subjects are responsible for project development and public relations. Anyone can propose options to upgrade the network by making changes to the Kusama code base, but in order for the application to be considered, they must pay a certain amount of KSM tokens.

Improvements and changes to the Kusama code base can be made through proposals that can be submitted by anyone, provided a minimum amount of KSM is contributed for this purpose. There are three main branches of government involved in this governance process:

The referendum chamber represents the token holders. KSM holders can propose a public referendum, determine priorities, take part in a referendum, elect councillors or apply to join the council.
The council consists of 13 members elected by ballot. The role of the council is to elect technical committee members, to veto a referendum, to propose a referendum in 1 of 2 launch periods, and to follow up quickly with the technical committee when critical updates need to be passed quickly.
The Technical Committee is elected by the Board. Includes development teams who have successfully implemented or specified either a Polkadot/Kusama runtime environment or a runtime environment. The role of the technical committee is to assess whether the proposal is urgent or not, and then decide to expedite it with the Board. In this way, critical updates will be implemented first.

The main advantages of the Kusama project (KSM)

  • Unique technology.
  • Reliability and security.
  • Public governance.
  • High-speed transactions.
  • Low-cost connectivity.

Hosting a parachain on Kusama is cheaper than on Polkadot. Young and low-budget projects, bench-test parachains on Kusama, before launching on Polkadot. Parachain (paralleled chain) is a simpler form of blockchain whose security is ensured by a ‘relay chain’. Parachain requires a slot, which can be purchased at auctions.

There are also Parathreads systems. These are much like Parachain, but there is a fixed registration fee at launch, which will be much lower than the cost of purchasing a Parachain slot. However, this fee only guarantees code registration. As new blocks are created, they will be charged for checking them and adding them to the relay chain. Parachains are multifunctional, they can be used to run DeFi pools, identity and supply chain systems, games and NFT, the Internet of Things, DAO and much more.

Kusama’s bridging parachemes can be connected to external networks such as Bitcoin and Ethereum. While other blockchain networks only allow developers to create applications using smart contracts, Kusama gives them full control over the underlying blockchain. This flexibility gives Parachain developers maximum freedom to optimise for specific use cases, which means better and more secure applications and services.

Kusama’s origin story and team (KSM)

The founder of the project is the same Gavin Wood. A former Microsoft researcher, and co-founder of Ethereum. In July 2019, DOT indicator token holders received KSM tokens by executing an Ethereum transaction to form the Kusama genesis block.

A month and a half later, Kusama launched a proof-of-authority program, as the only validators allowed to generate blocks were the nodes that launched parity and Web 3 foundation. After a couple of months of chaos, the Kusama blockchain moved to PoS. Management is in the hands of Kusama coin holders.

Kusama mining (KSM)

Traditional mining on computing hardware is not supported. However, Kusama mining with Kusama wallet is available. You can either become a validator yourself and earn rewards or you can activate KSM Stacking.

In order to start the stacking in Polkadot JS wallet, you need to:

Create a new account or import an existing one, using a recovery phrase or JSON file.
Connect to the Kusama network under Settings. Select Kusama parachain (Polkadot canary, parity placement) and save the changes.
Top up your KSM balance.
Open the “Stacking” section and click on the “Account Features” tab.
Click on “Nominator” and select the imported account as storage and controller.
The stash account is for savings and the controller is for transactions. For optimal fund security, using the same address for stash and controller is strongly discouraged, but not prohibited.

Specify the stake amount, (it must not be equal to the maximum balance amount for you to be able to pay the fee) and click ‘Next’. Deposited funds will not be available until the end of the deposit period (minimum 7 days), the unblocking operation will be carried out manually. You can use automatic selection of the most profitable validators at the moment or you can disable this option and nominate the selected validators personally. Then you need to sign and submit the transaction. Your nomination will be inactive until the next session, be patient. Running the validator node requires Linux operating system skills.

You can read more about setting up the validator node here. Keep in mind that there is a risk when placing bets for both validators and nominees, as both can lose up to 100% of their funds if the validator is shorted.

Where to buy Kusama cryptocurrency (KSM), exchanges available

The digital asset Kusama coin is supported by the Binance exchange and 35 other venues. At the moment, Binance is the most secure and convenient, but to trade on this platform, you need to undergo identity verification.

Trading pairs on Binance:

KSM/USDT
KSM/BTC
KSM/BUSD
KSM/AUD
KSM/BNB

You can buy or sell KSM in US dollars on Bitfinex. Kraken supports KSM/EUR, KSM/USD and KSM/GBP trading pairs.

Kusama Secure Wallet (KSM)

No official wallet has been released for KSM storage. You can work with the Kusama blockchain through the Polkadot v0.9.13 online wallet.

To create an account, go to https://polkadot.js.org/apps/#/explorer, and change the Polkadot parachain by opening the drop-down menu in the upper left corner. Be sure to specify “via Parity” and reload the interface by clicking Switch.

You can now proceed to create an account. Kusama. Open the Accounts tab and click “Add account”. The system will generate an address and a mnemonic phrase of 12 words in random order. Be sure to write them down and check the box next to “I have saved my mnemonic seed safely”. Now you have to come up with a login and password, and then save the JSON file in a safe place. Done, wallet created.

If you need a mobile wallet, install Polkawallet.io, Lunie.io or Fearless Wallet mobile app. Kusama cryptocurrency is supported by Ledger hardware safe.

Conclusion

The project is fully decentralized and exists as a standalone blockchain. However, in the future, Kusama may connect to Polkadot via a bridge or as a hierarchical sub relay chain. Either way, KSM holders will not be left out.

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