Ouyi OKEx: Polkadot parachain auction is about to start, which forces are ready to go?
According to the latest official news, the parachain test network Rococo has launched the public welfare parachain Statemint and has begun testing asset issuance. Projects such as Acala, Zenlink, ChainX, and Bifrost have issued test tokens on the Statemint testnet.
And this is just a prelude. According to the plan, the Kusama and Polkadot mainnets will start parachain auctions one after another. At that time, not only will more project parties participate in the competition, but also many institutions and investors will be attracted to witness this industry event.
The market has long been aware of this: DOT rose to a peak of $48.381 from around $8 at the beginning of the year, and KSM has repeatedly set new highs recently, becoming one of the few bright spots in a volatile market.
In contrast, in the primary market, Polkadot ecological projects frequently raise funds, accounting for almost half of the total market financing. Funds from all walks of life took the lead in deploying, and together with many emerging projects, they became important builders of the Polkadot ecology.
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Besides Ethereum, which public chain is the most anticipated? The answer is undoubtedly Polkadot.
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DOT Market Trend (Source: OKEx)
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Dora, founder of OKEx Blockdream Ventures, summarized the reasons why Polkadot is so popular in the following three points:
1. The prospect of cross-chain network is promising
Compared with Ethereum, the two-layer structure of the Polkadot relay chain and parachain can provide stronger expansion capabilities. Its Substrate development architecture can greatly reduce the cost and difficulty of public chain development, and realize "one-click release chain".
In addition, Polkadot can bridge the Bitcoin and Ethereum networks to realize the cross-ecological transfer of assets. It has strong compatibility and is expected to break the information islands between different blockchains.
2. Strong team development
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A group photo of the founding team of Polkadot, with Gavin Wood in the middle
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3. The Polkadot ecology is improving day by day
Compared with other encryption projects, Polkadot is superior in ecological construction.
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Source: PolkaProject
At the end of 2020, some of the data disclosed by Gavin Wood in his year-end review also directly confirmed the prosperity of the Polkadot ecosystem: the Rust code base has more than 500,000 lines of code; there are already more than 2,600 developers on the Substrate technology channel, an increase from the beginning of 2020 nearly doubled; in total, more than $14 million in funding for more than 200 funded projects…
These data are precisely the focus of attention of investment institutions. According to Dora, OKEx Blockdream Ventures has been paying attention to popular public chain ecological projects since its establishment, and Polkadot is one of the few value public chains. The cross-chain ecology built around Polkadot is worth looking forward to, and will continue to explore the Polkadot ecology in the future The "top students" in the school.
Of course, there are external considerations for investment institutions to lay out the Polkadot track. Dora said that the current development of DeFi has entered the deep water area, and NFT is also accelerating its explosion, which greatly magnifies the performance bottleneck of Ethereum. When ETH 2.0 is nowhere in sight, emerging public chains such as Polkadot are expected to emerge suddenly, not to mention the current bull market. The market is still going on, and more funds will be injected into the Polkadot ecosystem.
Parachain auction becomes the biggest hotspot
If the Polkadot ecology is a fire, then the upcoming parachain auction is a barrel of oil. The combination of the two is expected to produce a huge chemical reaction.
What exactly is a parachain auction? To understand simply, Polkadot is composed of relay chains, parallel chains, and transfer bridges. If Polkadot is compared to a plug-in strip, then computers, refrigerators, washing machines and other electrical appliances are equivalent to parallel chains, and the jacks on the plug-in strip are parallel chains. Chain slot. Different electrical appliances can operate independently and share socket resources.
Since the operation of parallel chains needs to consume network resources, the number of initial parallel chains is limited. In order to ensure fair distribution, Polkadot allows project parties to obtain the right to use slots through bidding.
The project party needs to obtain the right to use by locking a certain amount of DOT for a certain period of time to bid. This part of DOT can be purchased from the secondary market or raised from investors. After the lease period ends, the locked DOT can be unlocked.
According to Dora, the founder of OKEx Blockdream Ventures, if the project party can become the first batch of parachains, it will not only give priority to sharing Polkadot ecological resources, but also gain huge market attention, which will benefit later development. Tokens are rewarded to supporters, thereby raising more funds.
Some investors have been keenly aware of the opportunities and have been hoarding KSM and DOT since last year. Now that the parachain auction is coming, how can these investors use their coins to support the project and get rewards?
Dora focused on two methods, one is to use the pledge tool in the Polkadot ecosystem to directly put the tokens in the hand into the smart contract, and the operating threshold is relatively high; the other is to use the related services launched by the centralized exchange, For example, OKEx’s upcoming card slot auction service allows users to directly lock up DOT for supported and optimistic projects, and the operation is relatively simple.
No matter which way is taken, the good show that investors are looking forward to is getting closer. On April 7, Kusama has officially launched the parachain auction webpage, explaining in detail what Kusama’s parachain auction is, how to participate and more frequently asked questions. On April 23, according to official news, the current parachain test network Rococo has launched the public welfare parachain Statemint and started testing asset issuance. Acala, Zenlink, ChainX, and Bifrost have issued test tokens on the Statemint test network.
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The reason why the Polkadot ecosystem is so hot is not only due to the efforts of the Web3 Foundation and the founding team, but also due to the joint efforts of the entire market. Broadly speaking, these forces fall into the following categories:
1. Crypto funds
Since 2020, with the launch of the Polkadot mainnet, investment in Polkadot ecological projects has become an important direction. No matter the top institutions or emerging capitals, they are continuously raising money on this track.
As a new player on this track, although OKEx Blockdream Ventures started relatively late, it has already laid out a lot. Founder Dora revealed that the fund has been exploring star projects in the Polkadot ecosystem through various channels since the beginning of the year, and has invested in more than 10 projects so far.
Like other institutions, OKEx Blockdream Ventures is willing to provide resource support and services for high-quality projects, provide value for their development, and accompany and witness the birth of blockchain killer projects together. The difference is that OKEx Blockdream Ventures needs to help the ecological layout and traffic growth of the trading platform while cooperating with project investment.
"For high-quality projects, the resources and traffic of the Ouyi OKEx platform can quickly help the project develop, quickly gain market attention and improve its brand awareness." Dora explained.
2. Exchange
2. Exchange
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Next, with the opening of the Polkadot ecological parachain auction, major centralized exchanges are expected to build token pledge portals to connect project parties and supporters participating in the auction.
3. Industry media, KOL and community
As a major event that can be foreseen in 2021, industry media, KOL and the currency community will also not be absent.
Let's take a look at the industry media first. Live broadcasts, special topics, market reports... almost available resources, the major media are not stingy when reporting on the Polkadot ecology, not only to aggregate resources, but also to compete for the right to speak, becoming one of the biggest movers in parachain auctions.
KOL is no exception. On Weibo, WeChat groups, and Moments, many KOLs in the currency circle are sharing various wealth codes for the Polkadot ecological platform, which has become a bright scene in the bull market.
What is more reflective of market sentiment is the community. From the beginning of the year to the present, many private equity groups have suddenly emerged in the industry, which has given ordinary investors the opportunity to participate in the primary market investment of Polkadot ecological projects. However, it should be noted that the quality of projects currently raising funds in the community varies from good to bad, and the lock-up period ranges from 3 months to 3 years. Investors need to comprehensively evaluate the risks involved.
4. Off-site institutions
Thanks to the strong trend of DOT in the past year, more and more OTC institutions are also increasing their holdings of this investment target.
Bloomberg terminal data shows that on February 4, Goldman Sachs, ICAP, JPMorgan and UBS purchased the first exchange-traded product (ETP) to provide customers with exposure to DOT cryptocurrency. Opportunities, but the share is still relatively limited.
According to Laurent Kssis, director of 21Shares ETP, Polkadot ETP currently manages more than $15 million in assets. The firm also manages the "Basket of Cryptocurrencies Index ETP," which tracks the performance of five major cryptocurrencies, and DOT is the index's second-largest constituent.
epilogue
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With the help of many institutions and investors, the Polkadot parachain auction is about to start.
On the surface, this is a competition for capital power, but in essence, the parachain auction is a parade of the Polkadot ecology, which tests the Polkadot team, the project party, and the Polkadot ecology supporters.
As Li Kunyun, the founder of Delian Capital, said, Polkadot will enter the ecological maturity period after undergoing card slot auctions, and this period is the most likely to produce leading projects. "Because most of the projects in the early stage are just copying the projects of the Ethereum ecology, preconceived and occupying the market, the real valuable demand in the Polkadot ecology will appear in the mature stage, and high-value leading projects will definitely appear at that time."
In the long run, the implementation of parachains is only one of the key nodes of Polkadot's macro vision. Whether Polkadot can truly build a blockchain network with interconnected chains in the future, we may as well wait and see.
