Kusama is an experimental version of its more well-known “cousin” Polkadot created to test and perfect the scalability and interoperability functionalities before deploying them on the Polkadot network. Kusama, with its low barriers to entry, caters to early stage projects with innovative and experimental ideas.

Beginnings

Kusama was founded in 2019 as a “canary network” for Polkadot. The term comes from the canaries that were used by miners to quickly detect poisonous gases in the coal mines. Similarly, Kusama can be used to test, trial and reveal potential flaws in the Polkadot setup. Kusama was envisioned and initiated by Dr. Gavin Wood, a founder of Polkadot, a former CTO of Ethereum, and founder of the Web3 Foundation. The Foundation supports the growing Web 3.0 ecosystem – with a focus on building a fair and decentralized internet – in which Kusama plays an important role.

Similar to Polkadot, Kusama offers a scalable and interoperable solution to organize different blockchains with various functionalities into a network of parachains. Built on Substrate, Kusama offers developers an opportunity to develop their own app-specific blockchains and connect them to the main network.

While strongly resembling Polkadot in design and functionalities, Kusama is not just a Polkadot testnet. They are two independent blockchains, with different priorities. Polkadot’s slower and more methodical governance approach ensures stability and security valued by high-value and low-risk projects, such as financial applications. Kusama, on the other hand, has lower economic and technical barriers to entry, so it is also suitable for small and medium projects with risky profiles.

From its conception, the Kusama team has been very active in engaging the community and attracting developers and ambassadors. In June 2020, the Web3 Foundation ran the first Hackusama – a hackathon within the Polkadot and Kusama ecosystem aimed to attract new ideas to expand and develop the network.

The Kusama native token – KSM – became one of the biggest crypto winners of 2020. At the beginning of the year, KSM was traded at around $1.5, while in December the price passed the $70 mark. In January 2021, Kusama was in the top 50 blockchains by market capitalization, with the $590 M market cap. One of the factors behind such an explosive growth may have been the successful launch of the Polkadot mainnet in 2020.

Uses

Kusama is aimed at a wide range of developers seeking to deploy innovative and cutting-edge blockchain projects. The network can accommodate both private and public blockchains, smart contract and high throughput chains, which significantly expands the scope of potential applications, including marketplaces, oracles, social networking, gaming and eSports.

The Kusama’s attractions for developers include possibility of fast changes which ensures flexibility for business, low entry barriers ideal for leaner startups, and engaged community which gives access to the talent and ideas pool. Kusama is also used by developers to test their applications before deploying them on Polkadot, as it offers all the latest tech tools from Parity Technologies and Web3 Foundation even before they are implemented on Polkadot.

During 2020, Kusama managed to get on board some of the big blockchain projects, such as Chainlink. Chainlink is a network of oracles connecting blockchains with the real world data streams. In preparation to launch a parachain on Polkadot, Chainlink has decided to deploy one on Kusama. This parachain would allow any Kusama project access to external data sources outside the blockchain.

An important tool for attracting new projects to Kusama is its Treasury. The Kusama Treasury consists of tokens collected through transaction fees and slashing on the Kusama network. These resources can be used to fund the projects proposed by community members that can benefit the network. Among the projects funded by the Kusama Treasury in 2020 are LocalCoinSwap aiming to increase blockchain accessibility to non-technical users, and Polkawallet and Soramitsu’s Wallet offering alternative wallets for Kusama and Polkadot holders.

Crypto investors can be interested in Kusama as a way of growing their portfolio with staking rewards. As Kusama is a proof-of-stake blockchain, KSM holders have an opportunity to receive rewards by staking their coins. The market annualized return on staking KSM as a nominator is 14,03%, according to Staking Rewards. This rate depends on the share of coins staked in the network and will fluctuate in the future.

Future Outlook

Kusama is a self-governed network without any centralized decision body, so the network’s existence, and all its upgrades and changes are decided by its users. In other words, Kusama will exist while there is a demand for its functionalities. With the growing number of projects on Kusama and the successful launch of Polkadot, it looks likely that the popularity of the network will continue to grow in the near future.

In 2020, the Web3 Foundation allocated one of its grants to Swisscom Blockchain AG to develop a Kubernetes Operator for sentry nodes and validators for both Kusama and Polkadot. This technology aims to contribute to the network’s robustness, making Kusama more secure and less vulnerable to attacks.

As Gavin Wood wrote in the Kusama launch blog post, “In Kusama’s mind, “R&D” stands for Risk and Danger”, and the project aims to live up to this promise. After its recent hackathon, Kusama partnered with Robonomics to develop “an interplanetary architecture of the Kusama network” which can connect networks and relay data between Mars and Earth.