Interpretation of Polkadot 2.0: abandon the slot auction mechanism, sell nuclear time in the form of NFT and can be cut and combined


Author: Jiang Haibo, PANews

Both Polkadot and Cosmos are star projects characterized by "interoperability" and "application chain" in the last cycle, and the number of active developers of both is also among the top spears in the public chain. However, with the emergence of modular and open source solutions such as OP Stack, there are more solutions for "blockchain as a service". EVM-compatible chains are more likely to attract funds and users. Polkadot and Cosmos "one-click chain" Competitiveness drops.

This period is relatively difficult for both Polkadot and Cosmos, and Polkadot is also facing the problem of unlocking the locked tokens participating in the slot auction (or called leasing), and the tokens that need to be locked in the new auction are almost negligible. Therefore, Polkadot founder Gavin Wood put forward the idea of Polkadot 2.0, shifting from chain-centric to block space and application-centric.

Polkadot 1.0 status and dilemma

Polkadot is a blockchain protocol developed by Parity Technologies (also founded by Gavin Wood), which is designed to achieve interoperability between different blockchain networks, allowing different blockchain systems to communicate with each other and share information. Its main components include: relay chain, parachain, parathread and cross-chain bridge. Parachains do not need to maintain their own security facilities, all security is provided by the relay chain, and parachains can share the security of the relay chain.

Polkadot is fully functional and the code base is about to be released. The "slot" on Polkadot is rented out for a period of 6 months to 2 years, and the parachain obtains the position on the relay chain through auction. The funds (DOT) participating in the auction will only be locked and will not be consumed, and will be returned in full after expiration. Usually, parachain projects use native tokens as incentives to raise funds from users to participate in the auction in the form of "crowd lending".

Polkadot's first round of parachain slot auctions will start in November 2021. According to the two-year expiration time, the first batch of projects that have successfully auctioned slots are about to expire. The first slot was auctioned by Acala, and 81,000 community members contributed more than 32 million DOT. At that time, the price of DOT was close to 50 US dollars, and the funds participating in the Acala slot auction were as high as 1.3 billion US dollars.

Now, with the first round of auction slots still a few months away, those locked tokens are about to be unlocked. According to the original plan, if the subsequent auction also needs to lock up a large amount of tokens, it will not affect the price of DOT. However, the funds required for slot auctions are getting lower and lower. In June this year, the Moonbeam Foundation completed the 44th slot auction with only self-raised funds and successfully renewed the lease for two years. During this period, the price of DOT also fell from the highest point of more than $50 at the beginning of the auction to around $5.

Polkadot, which claims to be able to achieve shared security and solve the problem of isolated information islands between chains, frequently encounters security problems with assets on the parallel chain, such as the additional issuance of Acala’s AUSD in the head parallel chain, and many assets on Moonbeam come from the cross-chain bridge Multichain. The funds of the recipients have been transferred abnormally.

With the maturity of OP Stack and other modular chain issuance schemes, the competition in the underlying chain has also intensified, which will inevitably reduce the space for new well-known projects to adopt Polkadot's scheme to issue chains. The original auction method needs to be changed to reduce developers' entry. The threshold of Polkadot ecology.

The Transformation of Polkadot 2.0

At the Polkadot Decoded conference at the end of June, Gavin Wood proposed a new perspective for Polkadot 2.0. He redefined Polkadot as a multi-core computer that runs many applications. The Polkadot relay chain will be the foundation of the supercomputer, which provides the most resilient, general-purpose continuous computing. Polkadot 2.0 will abandon the existing parachain slot auction mechanism, shift from chain-centric to block space and application-centric, and the system will have stronger resilience.

According to Gavin Wood's description, the Polkadot supercomputer now has about 50 cores and will grow to 500-1000 in the future. In terms of performance, the bandwidth of each core is equivalent to 1 MiB/s, the Geekbench 5 test score of computing power is about 380, and the delay is 6 seconds. These data will increase with the development of hardware.

Parachains will be secured by these cores, and smart contracts can also be hosted directly on the cores. This avoids the need for custom chain infrastructure, increasing computing power and reducing costs, turning Polkadot into a world computer.

New kernel leasing mechanism

Under the original mechanism, the auction of slots is not flexible enough. Generally, slots for 2 years need to be auctioned at one time, and the addition of new parachains has high obstacles. In the new leasing mechanism, cores will be allocated according to core time (Coretime), including monthly batch leasing and instant leasing. The batch leasing plan accounts for 75% of the total, and 4 weeks of core time will be sold at a fixed price; instant leasing is priced through an automatic market maker, and the goal is to allow project parties to purchase on demand so that all cores can be utilized.

The nuclear time obtained from the batch auction exists in the form of NFT, which can be cut and combined, which can bring a variety of ways to play. The summary is as follows:

• Can be consumed to allocate the corresponding time period on the Polkadot core;
• Can be moved between chains and traded like other NFTs;
• NFTs that can be split into multiple smaller time periods and sold separately in the market;
• Can be assigned to a single project, or assigned to multiple projects in turn;
• Multiple cores can be combined to form more powerful computing power.

As shown in the figure below, if each line is regarded as the operation of a core within a period of time, each square is regarded as a core time. In the original scheme, it would be a row of consecutive full squares of the same color, which meant that an item would gain two consecutive years of use through a single slot auction.


The new scheme in the figure below can divide and combine the core and core time. A project can still participate in the lease for several months, which is equivalent to the original; it can also be leased to other projects when it is not needed; it can be run by multiple projects in one cores; it is also possible for a project to have multiple cores to improve performance.


The remaining time of the parachain slot that has been taken will still be valid, and it will have a basic performance. On this basis, the latency can be reduced by sacrificing bandwidth, or the latency can be reduced and performance can be improved through additional cores.

Summary

As the new blockchain scheme matures and Polkadot becomes less attractive, the number of DOTs required to be staked for slot auctions decreases. The scheme of leasing slots for two years at a time is also not flexible enough, hindering the entry of new projects.

Gavin Wood proposed a new leasing scheme. Nuclear time will be leased in the form of NFT. It can be cut and combined arbitrarily like NFT. For example, nuclear time can be leased to others when it is idle, and one core can run multiple projects. , run a project with multiple cores to improve performance.