What is Injective?

22 Oct 2023 by Harry Newman 4 min read

Injective is a layer 1 blockchain network built for finance that is based on the Cosmos SDK and Ethereum blockchain. It was included in a group of eight other projects to be incubated by Binance Labs in 2018. It is backed by Binance, Pantera and Mark Cuban. The mainnet was launched in 2021 and its mission is to create a truly free and inclusive financial system through decentralisation.

Injective and How It Works

Injective was founded by Eric Chen and Albert Chon in 2018, alongside the research and development company Injective Labs.

The Injective blockchain is built for finance. It is an interoperable layer 1 blockchain that is helping to power the next generation of DeFi applications, this includes prediction markets, lending protocols, decentralised derivatives and spot exchanges with many more potential applications.

Injective provides the tools to build decentralised applications or dApps, with the aim of having a comprehensive DeFi infrastructure that is interconnected. It is built using the Cosmos software development kit (Cosmos-SDK) and it’s smart contracts on the CosmWasm smart contract layer. CosmWasm is a smart contract platform that focuses on security, interoperability and performance and allows for multi-chain smart contract transactions to occur seamlessly. Injective is the only blockchain that enables automatic smart contract execution, generally, smart contracts require an external party such as a user to manually trigger the contract and the reasoning behind that, with the CosmWasm platform, smart contracts can be executed both manually by external users and automatically at every block, this helps developers to create novel use cases that would not be possible on any other chain.

Injective can also take advantage of the underlying architecture and interoperability that Cosmos Inter-Blockchain Communication (IBC) protocol provides. IBC makes it possible for various chains and dApps that use the IBC standard to transact with each other.

Injective also utilises the Tendermint-based Proof-of-Stake consensus mechanism that provides the ability to sustain lightning-fast performance of up to 10k+ transactions per second, Bitcoin by itself can only do 7tps, Ethereum has around 25tps and Solana 5ktps, this shows the potential that Lightning Network brings to Bitcoin.

Injective Ecosystem

The Cosmos ecosystem has a vision to become the internet of blockchains, or in other words a network of independent chains that can all communicate in a decentralised way. Any application that is built upon Injective is able to securely transfer crypto and web3 data across blockchains and dApps within the ecosystem.

They can natively access other layer 1 blockchains such as Solana, Ethereum, Polkadot and Cosmos.

The ecosystem within Injective includes over 100+ products and over 200k community members.

Injectives exchange module provides capabilities that include an advanced on-chain order book and matching engine for spot, futures, perpetual and options markets.

Injective is resistant to Miner-Extractable Value (MEV) which can occur when block producers in a blockchain are able to extract value by arbitrarily reordering, including or excluding transactions within a block to harm users, through frequent batch auction order matching and zero gas fees for users.

Some key points within the Injective ecosystem are:

Create and trade new derivative markets, by using Injectives fully open and permissionless decentralised derivatives exchange protocol. Allowing users to freely trade, and even create new derivative markets.
Every month 60% of generated fees from trades and dApps are aggregated and auctioned to the public through buyback and burn. Users can bid using INJ to purchase the aggregate exchange fee, all proceeds from this auction are then burned creating a deflationary token supply.
As an INJ holder, you can stake your tokens by delegating to an existing validator or become a validator yourself, doing this allows you to earn staking rewards for helping to secure the Injective network and also the ability to participate in governance votes.

Injective Token INJ

INJ is Injective’s native token, which is used to validate transactions, as a governance token and users can stake their INJ on the Injective Hub for currently around 15% APR.

Furthermore, the Injective Hub allows users to use the Injective Bridge which is a lightning-fast, low-cost, safe and secure bridge to transfer cross-chain assets to Injective. As well as partake in governance with constant proposals being put forward.

There is a total max supply of 100,000,000 INJ with a current circulating supply of 83,755,556. The public sale price for INJ was $0.40, with an all-time high price of $25.

The token distribution for INJ is as follows:

Public Sale - 9%
Private Sale - 16.67%
Team - 22%
Advisors - 2%
Seed Sale - 6%
Ecosystem Development - 34.33%
Community Growth - 10%

INJ is available on most of the popular exchanges such as Binance or Coinbase. The future for Injective is bright, with lots of potential yet to be unlocked, with new possibilities for fast, cost-effective and secure trading within a decentralised ecosystem.

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