What applications can Kaspa covenants enable?

Kaspa covenants can enable fungible and non-fungible tokens, smart vaults with timelocks, stateful applications, and trustless Layer 1 to Layer 2 bridges. These capabilities come from the ability to attach state to UTXOs and enforce correct state transitions within Kaspa's script system. Smart vaults can lock funds until a condition is met, while trustless L1-to-L2 bridges become possible when covenants are combined with KIP16 ZK proofs. For a beginner, this means a wide range of on-chain applications can be built on Kaspa's base layer without relying on a third-party execution environment.