Kik, a famous chat app has launched a plan that will see it use its Kin tokens on both the Stellar blockchains and Ethereum. If the plan is successfully implemented, it will make Kin tokens the first cryptocurrencies to use bidirectional network support.
This announcement was made recently by Gadi Srebnik, the developer of kiki through a blog post. In the post, Srebnik explains how the company which managed to raised $98 million through an initial coin offering (ICO) last year will deploy its digital currencies on several blockchains so as to boost efficiency and liquidity within the ecosystem.
Up to now, Kin has been operating as an ERC20 token mainly on the Ethereum blockchain. Due to frustration as a result of network’s susceptibility to network congestion, Kik announced last year that it intends to transfer its tokens to Stellar, which has a federated consensus model that allows for cheaper and faster payments.
However, Ethereum is far more liquid than Stellar, so changing blockchains may have come with its drawbacks. kiki seems to have discovered this and developed a way which can be used to deploy Kin in parallel on both blockchains. All this is done without increasing the supply quality. Internal transactions using one digital currency helps utilize the Stellar-based tokens, while at the same the external payments as well as exchange volume are likely to occur primarily on the Ethereum network.
After releasing and fully initiating the Stellar-based Kin token,which is expected later in the year, users will be in a position to shift their tokens between networks by simply locking them upon one network and then unlocking them on another network. This can be done through a through a smart contract method. Many developers have said that this method will assist in ensuring the tokens maintain a much stable value in both networks.
According to Srebnik however, developing this mechanism may take a long period going in several months. However, he did not elaborate whether the long period would cause a delay in launching the standalone Kin app on which the Stellar blockchain will run.