What is the impact of parallel chain auction on Polkadot ecology?

Will the auction lead to higher DOT prices?

What is the impact of parallel chain auction on Polkadot ecology?
  1. Do all Polkadot eco-projects need to bid for 2 slots?

PolkaWorld: This depends on the eco-project itself, currently in the Polka Eco-project.

If the eco-project has only one network, it can choose to bid only on Kusama parallel chain slots, like KILT, or only on Polkadot slots, or it can also bid on Kusama and switch to Polkadot later, like Bifrost.

If the project owner has two networks, a canary network and a main network, then they should be running two parallel chains on both Kusama and Polkadot, which means they will bid on both Kusama and Polkadot! For example, Acala, Plasm are like this.

Other projects have three networks, one independent chain network, one canary network connected to Kusama, and one main network connected to Polkadot, such as ChainX, which also bids twice, once on Kusama and once on Polkadot, and the independent chain is used to run separately!

The purpose of bidding is to use the security of the Kusama relay chain or Polkadot relay chain, so it is not a case of bidding on the Kusama slot and then panning to the Polkadot slot, but Kusama and Polkadot are two separate chains. bid on the parallel chain slot. You can bid on the Kusama parallel chain first and then bid on the Polkadot parallel chain after it expires, but there is no such thing as bidding on the Kusama slot and then panning to the Polkadot slot, this is not true!

  1. will Staking and slot-locked KSM/DOT lead to KSM/DOT deflation in the secondary market? Will this drive DOT prices higher?

PolkaWorld: The optimal allocation ratio in Polkadot’s token design is Staking:Slot Auction:Circulation = 50%:33%:17%, which is the ideal state for a game, i.e. when the Staking rate is at 50%, the verifier and nominator will have the highest revenue, anything above or below 50% will This will lead to a gradual convergence of the Staking rate to 50%. The remaining ones who want to maximize the value will naturally choose to lock the parallel chain, but this does not really guarantee the maximum value, because you have to measure the revenue of Staking and the revenue of slot locking, so the projects bidding for the parallel chain will provide their own tokens as a reward to motivate people to lock the parallel chain. Ideally, this is a deflationary process, and in economics, deflation causes an increase in value. I’m looking forward to seeing what the market will eventually look like!

From another perspective, before parallel chains, a polka was just a polka, just a meta-protocol with an infrastructure, and it was only worth the value of the polka itself. But after parallel chain, it’s the beginning of boca ecology, the beginning of boca value capture, and the biggest part of the value paving may come from the incremental market of boca DeFi ecology!

  1. What is the impact of slot auction on the development of Polkadot ecosystem?


As mentioned before, first of all this really opens up the development of the polka ecosystem and opens up the value capture of polka!

The second is that it can really filter out ecological projects with growth through the community, market and capital. Through the slot auction, a healthy boca ecology is established from the beginning!

What comes immediately after the auction is that we really enter the era of interoperable multi-chains, and we can look forward to what will come together!

  1. Regarding Polkadot, there have been two voices in the market. One is that Poca is the next Ether, and the other is that Poca slot auction is highly similar to EOS node campaign, and is the next EOS. What exactly is the role of Polka playing?

PolkaWorld: This question has been really repeated many times before… To briefly summarize, Ether, EOS are single-chain smart contract systems, Polka is a scalable heterogeneous multi-chain system. This means that Polkadot is not like those existing single blockchains that focus on different functionalities of Layer1, e.g. Bitcoin is a system that implements peer-to-peer transactions, Ether, EOS focus on smart contract functionality, Filcoin focus on storage functionality, etc. These are all single blockchains, while Polkadot is a single blockchain that doesn’t provide Polkadot is a Layer0 meta-protocol that does not provide any inherent functionality, only security!

And the above mentioned single-chain systems like Bitcoin and Ether, what they have in common is that each chain needs nodes that can maintain the chain security, especially for PoW chains, we know that the cost of maintaining the chain security of the miners is very high, so the role of Polkadot is to provide security for these single chains with specific functions, you just need to focus on your specific functions You just need to focus on your specific function, saving development costs and maintaining chain security costs, while at the same time making your chain customizable through the Substrate technology framework, and enjoying the interoperability that comes with the Polkadot ecosystem! This is the role of Poca, providing security for Layer1!

Slot auction and EOS campaign are not the same thing, there is no “high similarity” between the two, slot auction is essentially a process of locking DOT/KSM to rent “verifier nodes”, a real competition for scarce resources! Competition! The subject of the auction is a chain, and the result is that the chain can be put on the main network and run safely, not to earn any revenue or anything like that! The result is that the node can share the dividend!

  1. Is Polkadot a new technological high point compared to Ether?

PolkaWorld: Polka certainly represents the most cutting-edge blockchain technology now! Ether is an innovation on smart contracts, but smart contracts have too many limitations, so Polka implements the innovation of the chain and wants to provide a more underlying and more universal Layer0 meta-protocol from the very beginning! Ethernet is currently the second largest blockchain, but it is a single-chain system, Poca is from the beginning a multi-chain system that opposes the dominance of one chain! Just as we must move from the era of single-chain to the era of the Internet, this is the direction in which technology is moving!

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/what-is-the-impact-of-parallel-chain-auction-on-polkadot-ecology/
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