Injective (INJ)

What is Injective?

Injective (INJ) is a blockchain focused on optimization for decentralized finance (DeFi). The ecosystem is based on a decentralized network that provides scalable plug-and-play Web3 modules, such as a decentralized order book that developers can use to create financial decentralized applications (dApps). For instance, applications can use the order book to launch exchanges and prediction markets on the blockchain.

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Injective was launched in 2018 from Binance Labs and has received investment from crypto-focused US hedge fund Pantera Capital, Web3 investment firm Jump Crypto, and billionaire investor Mark Cuban.

The blockchain was built using the Cosmos software development kit (SDK) and can reach instant transaction finality using the Tendermint proof-of-stake (PoS) consensus framework. The mainnet launched in the fourth quarter of 2021, and Binance natively connected to the mainnet in the second quarter of 2022.

Techopedia Explains

Injective is natively interoperable across sovereign Layer 1 blockchain networks and is also Inter-Blockchain Communication (IBC) enabled. It can facilitate cross-chain transactions across Ethereum, Moonbeam, IBC-enabled chains such as CosmosHub, and Wormhole-integrated chains such as Solana and Avalanche, according to its documentation.

This means that tokens launched on the Injective blockchain can be used across multiple networks, and crypto assets or Web3 data can be transferred from other blockchains for use in any application built on Injective.

Since the third quarter of 2022, Injective has supported CosmWasm, an auto-executing smart contracting platform built for the Cosmos ecosystem that enables developers to launch their own smart-contract-powered dApps on the blockchain and migrate contracts that run on other chains supporting CosmWasm. Injective added on-ramp access for fiat currency in the fourth quarter of 2022.

The developers announced on November 30 that its largest mainnet upgrade will be released “in a few weeks”.

What is INJ Coin?

INJ is the native cryptocurrency for the Injective blockchain. It is used for staking, governance, and dApps. INJ was launched with an initial supply of 100 million coins and will increase over time through block rewards. The target inflation rate was 7% at launch and will decrease over time to 2%. However, the total supply may be lower than the initial supply as the coin has a deflationary mechanism.

The exchange protocol has a global minimum trading fee. As an incentive for exchange dApps to source trading activity on the protocol, they are rewarded with a share of the trading fee from orders that they source, according to the documentation.

The remaining exchange fee is subject to an on-chain buy-back-and-burn mechanism, in which the basket of exchange fees is auctioned off to the highest bidder in exchange for INJ. The INJ proceeds of the auction are then burned, deflating the total coin supply.

INJ can be used as an alternative to stablecoins as margin and collateral for Injective’s derivatives markets. In some markets, it can also be used as collateral backing or insurance pool staking, which allows stakers to earn interest on their locked coins.

Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.

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Nicole Willing

Nicole is a professional journalist with 20 years of experience in writing and editing. Her expertise spans both the tech and financial industries. She has developed expertise in covering commodity, equity, and cryptocurrency markets, as well as the latest trends across the technology sector, from semiconductors to electric vehicles. She holds a degree in Journalism from City University, London. Having embraced the digital nomad lifestyle, she can usually be found on the beach brushing sand out of her keyboard in between snorkeling trips.