Liquidity Providers

Liquidity providers deposit assets into KUU, pooling their assets together to collectively capture on-chain value. Whenever positions go into liquidation on lending protocols, or arbitrage appears between DEXs, KUU uses its pool of deposited assets to maxizimize the opportunity. Nevertheless, these opportunities are not always present and often only occur in times of high volatility. To ensure that KUU is always providing value for its liquidity providers, the pooled assets are lent out to other DeFi protocols to accrue interest while not in use.

When a liquidity provider deposits one of the supported assets into KUU's liquidity pools, such as AVAX, LINK, ETH or WBTC, they are entitled to a share of the value captured by the liquidity pool. The liquidity provider's share is determined by the proportion of assets that was deposited relative to the other liquidity providers within that pool. The assets, including returns, can be withdrawn by the liquidity provider at any time.

kuTokens

kuTokens are yield bearing assets, where the yield is determined by the value captured by the KUU liquidity pool. As a liquidity provider, when you deposit one of the supported tokens on KUU, such as AVAX, you will receive kuAVAX in return. These tokens are known as kuTokens, and represent your share of the underlying tokens in the liquidity pool. kuTokens are specific to the underlying token: depositing ETH gives you kuETH, depositing LINK gives you kuLINK, and so on. kuTokens can be returned to the liquidity pool to withdraw your share of the underlying token at any time, and are also transferrable between accounts.