Bidding for Polkadot’s tenth parachain lease auction has begun, with teams competing for an early seat at the table in building out Polkadot’s burgeoning ecosystem.
Ethereum co-founder Gavin Wood founded Polkadot in 2016 to realize his vision for a sharded Proof-of-Stake blockchain ecosystem. While Polkadot’s relay chain completed its mainnet launch during May 2020, the chain was only able to support DOT transfers and staking functionality until its first parachains went live at the end of December.
Polkadot’s interconnected parachains will be tasked with handling specialized computation for the network, including smart contracts. Parachain slots are allocated to projects that compete to lock up large sums of crowdsourced DOT through auctions, with the DOT returned to holders at the end of the lease’s duration (typically two years).
The heavy-hitters of the Polkadot ecosystem secured the first five parachain slots, with Acala, Moonbeam, Astar, Parallel, and Clover each pledging hundreds of millions of dollars in DOT to win auctions. All five projects’ parachains went live on Dec. 18.
Many onlookers believe Polkadot’s later auctions will be more closer fought without enormous sums of DOT being pledged by large VC backers, revealing which of Polkadot’s remaining front-runners have the strongest community support.
The winners of Polkadot’s parachain auctions numbered six through 10 will all go live on March 11.
Efinity won Polkadot’s sixth parachain auction on Dec. 31, pledging 7.7 million DOT from more than 20,000 participants.
Efinity describes itself as a cross-chain NFT network designed to offer an environmentally friendly and scalable solution for creating and using nonfungible tokens. It criticizes the current state of Ethereum’s NFT ecosystem for its “crippling fees” and “disjointed interoperability.”
Efinity was launched by the team behind metaverse gaming project Enjin, which created the popular ERC-1155 standard for NFTs.
Once its parachain is live, Efinity plans to launch a marketplace cross-chain bridge for NFTs, plus an automated swap exchange for token adhering to Enjin’s forthcoming “paratoken” standard.
Composable Finance won Polkadot’s seventh parachain slot on Jan. 14 with more than six million DOT sources from more than 9,000 backers.
Composable is building infrastructure designed to facilitate cross-chain DeFi by enabling smart contracts native to different Layer 1 networks to operate within a single parachain. It will also strive to support seamless interactions between L1s and L2s.
Composable’s tech stack will support EVM-compatible networks, IBC-enabled ecosystems, and other parachains within the Polkadot ecosystem. The team describes its infrastructure as “blockchain-agnostic,” enabling dapps to deploy across multiple different layers and chains without disrupting the flow of communication or assets.
The team describes Polkadot’s palette-based architecture as critical to its vision, enabling the customization needed to design a virtual machine capable of “orchestrating the interaction between different bridges while providing route management, callbacks into smart contracts, reliability, and finality.”
Centrifuge won the eighth slot with more than 27,000 backers pledging over 5.4M DOT on Jan. 28.
Centrifuge dubs itself the hub of real-world DeFi. The project connects real-world assets (RWAs) to decentralized finance via its Tinlake platform, mobilizing the liquidity of DeFi to fund invoices, inventory, mortgages, and other assets.
Roughly one dozen real-world businesses have already teamed up with Centrifuge, using the platform to fund commercial real estate development, consumer loans, inventory financing, and other business activities tied to RWAs. Users that provide financing to the platform receive returns in both stablecoins and Centrifuge’s native CFG token.
The Centrifuge Chain is currently live as its own Layer 1, with users able to Tinlake via the Ethereum network. When the second batch of parachains goes live, Centrifuge will fork its Centrifuge Chain to become a Polkadot parachain. Tinlake will then launch on the parachain, enabling assets to be financed from both the Polkadot and Ethereum ecosystems.
Centrifuge has also launched integrations with top DeFi blue-chips Aave and MakerDAO, and leading Polkadot teams Acala, Moonbeam, and Parallel.
HydraDX won the ninth parachain auction with a bid of more than 2.4 million DOT from roughly 7,700 contributors on Feb. 11.
HydraDX is a decentralized exchange pioneering an “Omnipool” design. In contrast to typical decentralized exchanges, which facilitate trades using individual pools for each asset pairing, all assets traded on HydraDX will be executed against a single Omnipool comprising a wide range of assets.
The protocol will use two tokens. HDX will be used as a governance token, with the token distributed via a liquidity bootstrapping protocol (LBP) event held in Feb. 2021 and also set to be paid out as liquidity mining rewards in the future.
Lerna (LRNA) will comprise its “pool token,” with 22.9 million LRNA distributed to the Omnipool to match the 22.9M DAI raised through HydraDX’s LBP. The supply of LRNA will then fluctuate as liquidity is added or removed from the protocol. LRNA will be burned when liquidity is removed from the Omnipool, while new supply is added alongside liquidity.
With all trades executed and fees being paid via the LRNA token, Lerna will be used to measure the price of all other assets traded in the Omnipool.
Tenth Parachain Out for Auction
While Polkadot’s 10th parachain auction began on Feb. 18, Interlay is currently beating out its nearest competitor by almost two-to-one with 2.2 million DOT from more than 8,000 contributors.
Interlay also came second in the ninth auction, with all but one of the previous auctions’ runner-ups having gone on to win the following auction.
Interlay describes itself as a cross-chain DeFi hub enabling Bitcoin to be used in decentralized finance applications on multiple chains using its insured InterBTC vault and token. Initially, Interlay will focus on bridging BC over to the DeFi ecosystems of Polkadot, Ethereum, Cosmos, and Kusama.
Corrected on Feb. 21 to report that when Polkadot’s relay chain completed its mainnet launch during May 2020, the chain was only able to support DOT transfers and staking functionality until its first parachains went live at the end of December. An earlier version of the story wrongly reported that the relay chain wasn’t able to support transfers.