Recently, bitcoin has ushered in a rare bull market in the past two years, which has triggered a new round of investment in encryption assets. At the same time, blockchain technology, the infrastructure of encryption industry, is also developing at a high speed: Bastian, engineer of parity (top blockchain technology team), tweeted the latest progress of Polkadot parallel chain: V1 version has been launched, and consensus code has been updated.
According to the speech given by Gavin wood, founder of Polkadot, at Polkadot's China trip in October, the parallel chain slot auction is expected to open at the end of the year.
Polkadot parallel chain is a special chain connected to the main network of Polkadot. On the basis of the security protection of the main network, the parallel chain has two characteristics: customization and autonomy: each parallel chain can have its own characteristics different from the main network according to its own use, and it can also control its own governance ability.
In addition to sharing security with the main network, parallel chain also has two innovations: the interaction on the parallel chain can be processed in parallel, so as to achieve a highly scalable system; transactions can be distributed throughout the chain, so that more transactions can be processed in the same time period.
It can be said that Polkadot parallel chain provides an excellent solution to the two major pain points of "king of public chain" Ethereum, which is lack of scalability and congestion. It is also a step faster than Ethereum 2.0, which is still in crowdfunding stage. Therefore, it will naturally be favored by the project side and investors.
Clever auction rules
Gavin Wood said in July this year that the maximum number of parallel links is about 100, and the development team needs to conduct periodic tests on the operation of relay links into parallel chains, so that there will not be a large number of parallel links in a short time.
In addition to using parallel chains directly, some lightweight projects can also choose to use parallel threads or deploy them directly to some parallel chains that support smart contracts. However, they need to wait for the parallel chains to be implemented gradually.
These methods are obviously not suitable for large-scale projects that have been formed. In case of short supply, the project side needs to rent slots through bidding and then connect to the parallel chain. The slot is like an electrical socket, while the parallel chain is similar to an electrical appliance. In the case of limited cable carrying capacity, only a few essential household appliances can be "powered on".
Polkadot's parallel chain slot auction has two interesting designs: candle auction and initial parallel chain crowdfunding (IPO).
The project side will compete for the parallel chain slot in the form of candle auction. Candle auction means that the auction will stop immediately at an expected time point, and the higher bidder will bid successfully. To capture the slot, the project side needs to pledge as many Polkadot tokens as possible.
According to the research literature of Web3 foundation, the candle auction design of parallel chain is to hope that the bidders with higher valuation in mind have a higher chance to win the bid, which is related to the difference between the value and the market value. A random close means that the bidder has to submit the bid price carefully after the auction starts.
If it's just like this, isn't it possible for the project owner with the strongest funds and the highest bid to get it? Don't worry, the project side can crowdfunding. IPO allows projects to borrow from the outside, that is to use the team's brains, design their own incentive measures to attract investors to lock more dot to themselves. With IPO, not only investors can participate in the slot auction, but also the project parties participating in the auction can show their magic power by distributing tokens.
Beware of malicious competition
At present, there are some projects, such as the Defa project 'Acala', the privacy infrastructure 'Phala', the Internet of things blockchain project 'MXC' ,decentralized wallet 'Hashkey Me', and the cross chain network 'chainx', 'Darwin', 'Bifrost' and other projects have announced that they will participate in the first round of Polkadot parallel chain slot bidding. In fact, in addition to practical application, participating in the auction is also a proof of the strength of the project itself.
In addition, it can enrich the application scenarios of dot, enhance the value support and reduce the circulation through the form of pledge participation in bidding.
However, the form of auction is bound to bring some problems. The founder of Acala once pointed out that bidding may lead to problems such as bad money driving out good money and institutional middlemen making price differences.
In the auction, the well funded garbage projects may beat the high-quality projects, and then use the "Polkadot parallel chain slot" as a gimmick to issue coins to cheat investors; some organizations may also focus on the parallel chain slot, auction and store goods in person, and then resell them to the project parties in urgent need of slots for arbitrage, which will increase the development cost of those who really need the slots.
As Zhu Weiyu, partner of NGC ventures, an investment institution, said, "if some well-known public chains bid in person, some high-quality projects with relatively insufficient capital strength may not be able to get a slot. This problem needs to be solved by Web3 foundation and ecology together. "
Prospects
If the first round of auction is held as scheduled, the first batch of projects can be successfully connected to the parallel chain. Polkadot, led by the co-founder of Ethereum, will be one step closer to the title of "Ethereum killer"
At the same time, don't forget to judge the value of the project in the hands of the investors if they want to use the project support measures. If we accidentally become the promoter of bad money driving out good money, we will ultimately bear the loss.
