Polkadot has released its first five parachains, placing the blockchain on the road to becoming an interoperable ecosystem.
Since November 11th, Polkadot has held parachain slot auctions. Crowd loans were used by projects seeking to win a slot to raise DOT and stake the tokens in order to bid for parachain slots. Through the first ten participating projects, over $3.5 billion in crowd-loans DOT was raised.
Acala, Moonbeam, Parallel Finance, Astar, and Clover were the first five auction winners. These projects focus on decentralized finance, cross-chain interoperability, and other use cases. A parachain lease has been granted to each project until October 20, 2023.
Interoperability between chains has yet to mature, despite the rapid growth in the number of public blockchains. The blockchain ecosystem is disorganized and it makes sending data across chains difficult. Despite the fact that several interoperable bridges have evolved, they are widely regarded as dangerous due to their reliance on centralized processes like token wrapping.
Polkadot enforces cross-chain communication at the protocol level and natively protects Layer 1 parachains using a technique termed shared security to overcome the interoperability challenge.
Polkadot is a smart contract blockchain capable of supporting up to 100 parachains. It was founded by Gavin Wood, the former CTO of Ethereum, with the goal of allowing application-specific parachains to connect with one another. Polkadot’s main central chain, known as the Relay Chain, secures parachains.
Parachain slots are auctioned off to projects over a period of 96 weeks.The next round of Polkadot’s parachain auctions will take place on December 23, with the auction winners being announced on March 11, 2022.