Deep Dive
1. Covenant++ Security Features (8 January 2026)
Overview: This update, powered by KIP-17, introduces native "covenants" to Kaspa. These are programmable rules attached to funds, allowing users to set conditions like whitelisted addresses or spending delays without relying on complex smart contracts.
The feature is currently live on Testnet 12. It enables several key security functions directly on Layer 1 UTXOs: Whitelisting restricts sends to pre-approved addresses; Time Locks impose a cooling period before funds move; Multi-Signature Requirements add extra approval layers; and a Dead Man's Switch can automatically transfer funds after a period of inactivity. These rules can be combined for sophisticated vaults.
What this means: This is bullish for Kaspa because it provides bank-grade security for everyday users directly on the fastest Proof-of-Work chain. It turns simple cash into self-protecting money, significantly reducing risks of theft, loss, or human error without slowing down transactions or increasing fees.
(Cryptopumpzzzz)
2. Covenant-Centric Hardfork (Planned May 2026)
Overview: This is a planned, mandatory network upgrade (hardfork) that aims to fundamentally expand Kaspa's capabilities. Its core goal is to enable native assets and smart contract functionality directly on the Kaspa Layer 1 blockchain.
The upgrade will build upon the covenant system, allowing for more complex programmable logic. Planned ecosystem components include SilverScript for DeFi and formal KRC-20 token standards, which would allow developers to create tokens and applications natively on Kaspa.
What this means: This is extremely bullish for Kaspa because it represents the project's next major evolution from a pure payment network to a programmable platform. If successful, it could unlock a full DeFi and application ecosystem, driving new utility, developer activity, and user adoption.
(BSC News)
Overview: This was a foundational network upgrade that significantly increased Kaspa's throughput and reduced latency. Implemented via KIP-14, it raised the block production rate from 1 block per second (1 BPS) to 10 blocks per second (10 BPS).
Technically, it increased the GHOSTDAG parameter K to 124 and the maximum block parents to 16. This allows more blocks to be processed in parallel every 100 milliseconds, which directly translates to higher potential transactions per second and faster confirmations for users.
What this means: This was bullish for Kaspa as it delivered on its core promise of speed, making transactions nearly instant and incredibly cheap. It provided the scalable base layer necessary for supporting high-volume applications and future upgrades like smart contracts.
(CoinMarketCap)
Conclusion
Kaspa's development trajectory is clearly advancing from a high-speed digital cash system toward a secure, programmable Layer 1, with recent codebase updates laying the groundwork for native smart contracts and sophisticated asset control. Will the successful rollout of its Covenant++ and upcoming hardfork catalyze the first wave of scalable DeFi on a Proof-of-Work BlockDAG?