13.1 General Questions

What is Klara?

Klara is a self custodial credit platform that lets you use your crypto as collateral without selling it. You deposit assets into a vault, and the system mirrors the value into a spendable credit line that you can use with virtual and physical cards.

Is Klara a bank?

No. Klara is not a bank and does not operate like one. It is a self custodial credit protocol that uses blockchain technology and traditional payment rails to offer real world spending.

Do I have to sell my crypto to use Klara?

No. You never sell or lose custody. Your assets stay locked in your vault, and you spend credit that mirrors their value.

13.2 Vault and Collateral Questions

What happens to my crypto when I deposit it into the vault?

Your assets remain in your control inside a smart contract. They are only locked as collateral and cannot be moved without your approval.

Can Klara access my crypto?

No. Klara has zero access to your funds. Only you can move or withdraw collateral through your passkey or wallet.

How does Klara decide my credit limit?

Your limit is based on the value of your collateral, asset volatility, and the minimum health ratio required for safety.

Can I withdraw my collateral anytime?

Yes, as long as your remaining collateral still meets the required health threshold. If withdrawing would make your position unsafe, the app will block the action and show you why.

13.3 Credit and Spending Questions

How do I spend with Klara?

You spend using the Klara virtual or physical card. When you make a purchase, the system deducts from your credit limit, not your vault.

Does Klara report credit to traditional bureaus?

No. Klara credit is fully onchain and does not interact with traditional credit bureaus.

Can I increase my credit limit?

Yes. You can add more collateral at any time, or maintain a strong health ratio to receive credit boosts over time.

What happens if my collateral value drops?

You will receive alerts in the app. You can add more collateral or repay part of your credit. If your health drops too low, a controlled liquidation process may occur to protect your position.

13.4 Card Questions

Where can I use the Klara card?

Anywhere major payment networks are accepted. This includes online merchants, physical stores, travel, hotels, subscriptions, and more.

Do I get both virtual and physical cards?

Yes. Virtual cards can be created instantly in the app. The physical card can be ordered after account approval.

What happens if my card gets stolen?

You can freeze the card instantly inside the app. All virtual and physical card controls are available with one tap.

Can I set limits for each card?

Yes. You can set spending limits, merchant controls, and region rules for any card you create.

13.5 Settlement and Transaction Questions

How does the payment get processed?

Your card transaction is approved by the Klara Credit Engine, settled through the payment network, and logged onchain by the settlement layer.

What currencies can I spend in?

You can spend in almost any currency supported by global card networks. FX handling is done automatically in the background.

How fast are transactions?

Instant. Card authorizations take less than a second, just like traditional cards.

13.6 Security Questions

Is Klara safe?

Yes. Klara is built on self custody, audited contracts, passkey security, and transparent onchain logic.

Can Klara freeze my vault?

No. The vault is yours. Klara cannot freeze, access, or move your collateral, without your strict permission.

What happens if Klara goes offline?

Your vault remains safe and untouched. You still have full onchain ownership of your assets.

Does Klara store my private keys?

No. Klara never sees or stores your private keys.

13.7 Token and Rewards Questions

Does Klara have a token?

Yes. The Klara Token is the ecosystem’s utility and governance asset. It connects loyalty, staking, fees, and user incentives.

How do I earn Klara Tokens?

Through spending, referrals, loyalty tiers, staking, and future reward events.

Can I convert my points into tokens?

Yes. Points can be converted into tokens when the token converter goes live.

Will the token reduce my fees?

Yes. Holding or staking tokens unlocks lower fees, higher limits, and special perks.

13.8 Compliance Questions

Do I need KYC?

Only in regions where card networks legally require it. Some countries allow partial or no KYC for limited features.

Is Klara legal in my country?

Most regions are supported, but some may be restricted by card network rules or crypto regulations. The app will notify you if access is limited.

Does Klara report my activity for taxes?

Klara does not automatically report to tax authorities. However, users are responsible for understanding tax rules in their region.

13.9 Troubleshooting Questions

Why was my transaction declined?

Possible reasons include insufficient credit, region restrictions, suspicious activity, or merchant blocks. The app will show the specific cause.

Why did my credit limit change?

Because your collateral value or market volatility changed. The credit engine updates limits dynamically to keep your position safe.

Why can’t I withdraw collateral?

Withdrawing would reduce your collateral below the required health threshold. Add credit or repay to restore balance.

13.10 Advanced Questions

Is Klara a lending protocol?

Not in the traditional sense. Klara does not lend money from a pool. Instead, it mirrors your own collateral into spendable credit.

Is liquidation automatic?

Yes, but controlled. It only triggers when absolutely necessary, and only enough collateral is used to restore health.

Does Klara rehypothecate user assets?

No. Your collateral stays where you locked it. It is never borrowed or reused.