Injective (INJ)

With 12 dApps and a number of major dApp deployments coming up, a powerful interchain smart contract layer could be of interest for anyone in the crypto space. Today we take a look at Injective, a standalone L1 running on Cosmos and with connections to the big players in our space. Let’s inject some Injective…

What is Injective (INJ)?

Injective is a specialized and interoperable layer-one blockchain (stand alone) but interoperable with big chains such as Solana and Ethereum, that can be used for DeFi applications. What started as a decentralized infrastructure solely to be used for the trading of a variety of financial instruments, such as derivatives, futures, and options for both crypto, stocks and forex futures for example, transformed into an whole ecosystem that wants to tackle the major issues Ethereum has to deal with.

With solutions built in for Ethereum ‘features’ such as MEV resistance, instant transaction finality. It’s also the only blockchain where developers can use pre-built, customizable modules to create dynamic applications that aren’t possible on other networks.

Birth of Injective

Launched in October 2020, Injective was one of the Binance Labs-backed projects on Binance Launchpad. Following its mainnet launch in November 2021, Injective launched a $120 million incentives program to boost liquidity and user engagement.

INJ Backing Ventures

It is also backed by other big institutions such as Jump Crypto, Pantera Capital and the billionaire Mark Cuban, so money isn’t really an issue in order to provide Injective a decent runway for future success.

INJ Eric Chen Ecosystem

 

This review of Injective (INJ) was created for informational purposes. This article is not intended for promotion.

General info about Injective (INJ)

Injective utilizes the Cosmos SDK and is secured by the Tendermint consensus PoS algorithm, a distributed group of renowned validators using a Byzantine Fault Tolerant (BFT) system, which supports high transaction throughput (over 25,000 transactions per second) and block times of 0.65 second. It is perfectly suited for the trading of any financial instrument.

Their cross-chain interoperability is being reached via the Inter-Blockchain Communication (IBC) protocol, which offers asset exchanges across different blockchains with connections to leading blockchains such as Ethereum, Cosmos and Solana.

A distinctive feature of Injective is its gasless trading model, where users do not pay transaction fees directly; instead, these are covered by relayers. This is a solution to lower the entry barriers compared to traditional DEXs plagued by high gas fees.

They also utilize a CosmWasm smart contract layer capable of autonomous logic execution to ship truly decentralized applications with a flexible development suite powered by the coding language Rust.

INJ Ecosystem

Partnerships

Injective has formed several strategic partnerships to expand its ecosystem. These include:

  • Injective and Aethir are collaborating to pioneer tokenized GPU compute resources. This will convert computing capacity into tradable tokens on Injective.
  • Injective has officially integrated with the TON blockchain ecosystem. This allows assets like $INJ to be bridged and utilized across TON, while $TON can also be leveraged across Injective dApps.
  • Injective is one of the first L1 blockchains to integrate PYUSD, the stablecoin released by PayPal and Paxos

AI Agents & Injective

The Smart Agent Hub is an innovative platform designed to facilitate the integration of AI agents across different blockchain networks, specifically between Solana and Injective.

Leveraging Sonic’s HyperGrid technology, the hub aims to provide a robust environment where developers can create, manage, and monetize AI agents.

What Are AI Agents?

AI agents are autonomous programs that operate without direct human oversight. They can perceive their environment, make decisions, and act to achieve specific goals. To learn more about AI agents, read our piece on AI agents.

Injective is fostering a rich ecosystem for AI agents through several innovative projects:

  • iAgent SDK: This toolkit allows both tech-savvy and non-technical users to craft AI agents easily. It supports everything from basic commands to complex trading strategies and analytics.
  • $AGENT: A memecoin created using the iAgent SDK, showcasing the rapid deployment and community interest in practical AI applications on Injective.
  • ASI Alliance: A collaborative effort with entities like Fetch.ai and SingularityNet, focusing on decentralized AI development for broader adoption and integration across Injective’s financial applications.

Interested in our selection of memecoin and AI coins? Check out our guides!

inEVM

What is also important is that Injective has its own variant of the Ethereum Virtual Machine – the inEVM. Here you can deploy an application onto inEVM via the same means as any Ethereum-compatible blockchain, which means all applications of the Ethereum mainnet can also be deployed on Injective.

As a general rule, the process for deploying on and interacting with inEVM is the same as any EVM-compatible chain (including Ethereum, Polygon, Binance Smart Chain, etc.).

aUSD – Acala Dollar

Another interesting fact of the Injective blockchain is the introduction of the Acala Dollar, or aUSD. It is a stablecoin unlike most others, as it’s backed by a mix of digital assets such as Bitcoin, Ethereum, and Polkadot. aUSD is part of Acala’s suite of financial tools designed to simplify and secure online financial activities on the Polkadot network.

Injective Labs is integrating aUSD to bridge the gap between different blockchain assets, enhancing both stability and liquidity in its derivatives market. This move makes Injective one of the first to connect with Polkadot assets. The partnership is powered by a recent $7 million funding round that Acala secured.

The Injective Ecosystem Venture Group

Another interesting aspect of Injective is their own Venture Group, which is a group of prominent institutions and venture funds that are ready to invest in the future of Web3.

The core focus for the venture group will be to support promising projects building in different sectors, including interoperability, DeFi, trading, PoS infrastructure, rollups, and scalability solutions. These are projects that have the potential to change the course of the ecosystem.

Use case of Injective (INJ)

Injective’s native token, INJ, plays multiple roles within the Injective ecosystem, including:

  • Default asset to facilitate the purchase and sale of goods and services between parties on the blockchain (transaction fees, buying/selling NFTs, collateral, etc.)
  • Governance, where token holders can participate in decision-making processes
  • Staking, where tokens can be locked to earn rewards

 

INJ also serves as collateral for derivatives trading on the Injective platform, which is interesting for anyone who wants to trade on margin. While trading is gasless, as it was one of their main pillars, INJ is still used for paying fees associated with other transactions like staking and governance. 

INJ Staking

The INJ token generation event (TGE) occurred on October 21, 2020, with an initial supply of 100 million INJ tokens. The tokens were distributed across several categories, including seed and private sales, a Binance Launchpad sale, allocations to the team, advisors, ecosystem development, and community growth. Each category follows a specific vesting schedule to prevent sudden market oversupply. The vesting schedule has been completed in January 2024.

Injective Token Distribution

To combat inflation, INJ introduced a Burn Auction mechanism, where a portion of network fees is used to buy back and burn tokens. The INJ 3.0 update, passing with 99.99% of community members voting YES, increased the deflation rate by 400%, adjusting the supply based on staking dynamics.

The strategy includes a controlled inflation rate that decreases over time, combined with using 60% of all fees generated from exchange dApps, bridging, and transactions for burn auction activities.

The “Burn Auction” is a weekly event where community members use their INJ holdings to bid for 60% of exchange fees collected by Injective. The participant who places the highest bid using their INJ tokens wins the auction. This winning bid allows them to claim the 60% of the exchange fees for that period.

Injective INJ Burned

Also, Injective’s mint module dynamically adjusts supply parameters based on the network’s bonded-stake ratio, known as the Moving Change Rate Mechanism. This ensures supply aligns with demand and network security needs by incentivizing staking or unbonding based on block rewards.

INJ Staking

INJ Token holders can stake their tokens to secure the network and earn rewards with a current APY of about 11%. Staking involves a 21-day unbonding period with no access to tokens or rewards during this time. There is no minimum staking amount.

From a security perspective, staking enhances the stability and integrity of the Injective blockchain. By locking up tokens, stakers contribute to the network’s ability to validate transactions.

If you decide to stake, you gain voting rights and could participate in governance decisions, although this will only happen if you have some weight in the scale, because the amount of staked tokens will represent the voting power you have.

INJ Token Staking

Where to buy and sell Injective (INJ)?

What do we think about Injective (INJ)?

Injective’s future looks bright, with the recent $150 million ecosystem fund backed by Pantera Capital and Jump Crypto positioning the platform for significant growth. The expansion of AI integrations, the upcoming multi-VM initiative, and the growing stablecoin presence with the Acala Dollar (aUSD) could attract more developers and users to the platform.

As more users and developers recognize Injective’s unique features, such as its high-performance blockchain, cross-chain interoperability, and gasless trading model, the platform could do well. While the future is always uncertain, Injective’s strong fundamentals and backing from major players have created some runway for future growth.

 

Injective Logo

Injective (INJ) conclusion

In conclusion, Injective’s recent milestones, including the $150 million ecosystem fund, expanding AI integrations, and the upcoming multi-VM initiative, have positioned the blockchain for success. As more users and developers find their way to Injective’s potential, the platform could do well. 

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Disclaimer: Trading and investing in cryptocurrencies (also called digital or virtual currencies, altcoins) involves a substantial risk of loss and is not suitable for every investor. You are solely responsible for the risk and financial resources you use to trade crypto. The content on this website is primarily for informational purposes and does not constitute financial advice.

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