Earlier this week, Polkadot announced that the network is now able to run parachain auctions. Shortly after, a request was made on the Polkadot network for the first parachain auctions to begin on November 11, 2021.
Parachains are different specialized blockchains secured by the Polkadot blockchain. The special thing about parachains is that they can be connected to other blockchains relatively easily and can be individually optimized for specific purposes. As such, they represent the final piece of core technology needed for Polkadot to be the blockchain bridge builder of tomorrow.
Since places for parachains are limited, different projects have to compete in so-called parachain auctions in order to secure a place. In the following, we want to examine which projects currently have the best chance of being placed in a parachain on Polkadot.
4. Phala Network Privacy Network (PHA)
Phala Network is a cloud computing service that aims to provide businesses and individuals with a decentralized solution for sharing secure and private data. The project wants to be among the first parachains on Polkadot and enable the use of cross-blockchain smart contracts
In simple terms, this means that Phala wants to create an infrastructure for privacy in Web 3.0. For this mission, the Polkadot project relies on a hybrid blockchain TEE (Trusted Environment Execution) architecture. Through this, developers can use confidential smart contracts that can be processed through the Phala protocol. The three main products that Phala currently offers are a Phala Ethereum Bridge, a Web3 Analytics Tool, and a Dark Wallet.
3. Stake liquidity with Bifrost (BNC)
Bifrost is another project looking to participate in the upcoming parachain auctions on Polkadot. The Decentralized Finance (DeFi) project wants to make staking more flexible. Users can stake various staking tokens through Bifrost and receive vToken (Staking Derivatives Voucher Token) in return. These tokens in turn map tokens staked by 1:1 users. Unlike staked tokens, vTokens are freely tradable. This wouldn’t be possible with normal staked tokens, as you have to withdraw them before you can redeem them.
For example, you can use Bifrost to convert your DOT tokens into vDOT tokens. Although the vDOT generates a slightly lower yield compared to the staked DOT token, the vDOT can be traded freely and does not need to be withdrawn first. Going forward, Bifrost would like to offer a wide variety of vTokens as a parachain on Polkadot, all of which should be tradable on the blockchain.
2. Polkadot Moonbeam Multi-Channel Project (GLMR)
Moonbeam Network is considered one of the most promising Polkadot protocols of the next few years. Indeed, Moonbeam, as one of the few parachain contenders, is aiming for full compatibility with Ethereum. Specifically, the Parachain project aims to build a bridge to Ethereum that will add various on-chain governance, staking, and cross-chain capabilities to what is currently the largest smart contract platform.
A key advantage of Moonbeam is that Ethereum developers can relatively easily integrate their projects on Moonbeam. For this reason, the project is already working with a large number of Ethereum projects.
All these projects hope that with the help of Moonbeam, they will find the easiest possible way to connect their protocol to the different blockchains.
1. Acala Network, the all-in-one DeFi platform
Acala Network aims to become the number one DeFi project in the Polkadot ecosystem. Like Moonbeam, Acala Network is fully compatible with Ethereum and therefore offers many projects a simple option to integrate their projects into the DOT ecosystem.
Along with a decentralized exchange (DEX), liquid staking options, and an in-house stablecoin, Acala also wants to create a marketplace for crypto lending and borrowing. If these goals can be achieved, then Acala could become an all-in-one DeFi platform.
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