Kima, the asset-agnostic, peer-to-peer money transfer and payment protocol, launches its SDK to create a unified financial settlement layer. By building its protocol around direct money transfers via blockchain addresses and bank accounts, rather than smart contracts, Kima eliminates technical dependencies and vulnerabilities while welcoming blockchains and traditional financial institutions whose infrastructures are incompatible with smart contracts. The launch coincides with Kima joining FinSec Innovation Lab, a joint venture of  Mastercard and Enel X to support projects advancing research and development in financial technology and cybersecurity.

Smart contracts work, but not for everything. While the technological primitive has alleviated many efficiency issues in the blockchain industry, its security gaps also account for more than $3.1 billion in stolen funds from hacks in 2022. Likewise, smart contracts pose few solutions to the stagnation in Web3 adoption, as they do not support easy cross-network transfers or transactions—including on the Bitcoin blockchain. Fundamental tasks, such as transferring money between friends, converting crypto to fiat, or purchasing digital assets, involve too many obstacles for the average person to meaningfully use blockchain on a regular basis.

Kima leverages $1.7 million in pre-seed funding to launch its SDK for dApp developers, institutional Web3 builders, Web 2.0 apps, and fintech companies—empowering traditional institutions to begin bridging crypto and fiat. Unlike other crypto bridges, such as centralized swaps, and onramp-offramp services, Kima’s Smart Transaction primitive is not bound to exchanges or specific networks, ensuring minimized trust assumptions while maximizing efficiency. Likewise, its independence from smart contracts eliminates their security and counterparty risks.

Kima makes common financial services such as money transfers, transactions, and escrow services between ecosystems—blockchains and bank accounts—as seamless as possible by using funds from anywhere. It does this by using key building blocks to bolster settlement security, which includes:

• External accounts: EOAs (externally owned accounts) are native blockchain accounts that act as pools. By leading with accounts, there is no need for smart contracts on every blockchain, which boosts security by eliminating common attack points.

• TSS and trusted execution environments: Transactions utilize TSS and Intel SGX technology to control key sharing between the blockchain validators without allowing direct access. This enables more people to run nodes without concerns about compromising keys.

• Efficient liquidity management: Kima’s Liquidity Management (LiMa) algorithm manages universal supply and demand across all ecosystems and maintains a system-wide equilibrium using financial incentives, ensuring a high service level and liquidity distribution among various pools.

• Opt-in compliance: To allow fiat support and compliant crypto transactions, Kima employs an opt-in compliance system on the protocol level, unlocking access to legacy features such as fiat payments, and tokenized assets such as stocks and bonds. The compliance layer performs all necessary checks, including AML and KYT verifications to maintain the regulatory standard of compliance.

Kima’s peer-to-peer payment and transfer protocol introduces a vast infrastructure that fosters inter-ecosystem financial activity without intermediaries or smart contracts. The foundation of its offering, Kima’s settlement layer is built to handle wide-ranging applications including cross-border transfers, eCommerce, borrowing and lending, gaming, NFT marketplaces, wallets, and decentralized exchanges.

As the newest addition to FinSec Innovation Lab, Kima now has the capabilities to conduct complex research in evolving financial systems. The agreement garners critical support from Mastercard and Enel X to expand Kima’s beta program with financial institutions, launch pilot projects, and develop progressive technology.

“Crypto and fiat cannot move forward as partners without addressing the number of complicated intermediaries needed to bridge them, due to their complex regulatory and technical landscapes,” says Eitan Katz, CEO of Kima. “Simply put, our protocol aims to use the blockchain for what it does best: removing intermediaries. This is what will break the silos that impede progress and create unprecedented levels of efficiency and security. Launching our SDK indicates a step toward making cross-ecosystem financial interaction as seamless, secure, and transparent as possible, to make it as ubiquitous as PayPal or Apple Pay.”

Sidney Gottesman, CEO of FinSec Innovation Lab: “We are thrilled to welcome Eitan Katz and Kima to our lab and we look forward to our joint journey. Digital Assets is one of our focus areas and made Kima a natural fit for the lab.“ 

The FinSec Innovation Lab helps startups accelerate their journey to success by working on both commercial and technology areas. On the commercial side, FinSec provides access to our shareholder’s global subject matter experts and a wide network of alliance partners in government, financial institutions, technology, and venture capital. We support our startups in their process to get a government grant. On the technology side, FinSec provides access to infrastructure, solution architecture, and completion of a PoC. Each project is specifically tailor made to the startup’s needs.