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PolkadotCointelegraph Chinese (ID: CointelegraphChina), Author: NIKOLAI KUZNETSOV, reprinted with authorization by Odaily.The blockchain platform only launched its mainnet in May, but it has already become a major competitive force in the industry. In late August, inEOS、LitecoinDOT token denomination change
After that, Polkadot joined the list of top ten cryptocurrencies, surpassingLitecoinWait for altcoins.Kelvin Koh of Asian cryptocurrency fund Spartan Black has said that Polkadot maybe the top three
blockchain. Additionally, Dan Morehead of Pantera Capital Management recently spoke with Bloomberg
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He made his take, emphasizing that while Polkadot’s current market capitalization is around 10% of Ethereum’s value, his firm believes Polkadot has a “significantly higher chance of being a competitor to Ethereum than 10%.”
Although people have been guessing what factors will drive the price of ETH, there has been a trend in its life cycle: as more and more developers build applications that have user appeal and value, the price of ETH will increase. The outlook is even more bullish.
If the same is true for Polkadot, analysts' forecasts seem promising. The popularity of decentralized finance has caused the price of ETH to double this summer. Now, DeFi developers also seem to be paying attention to Polkadot, hoping to take advantage of its fast throughput, Substrate development framework, and eventual interoperability.However, Peter Mauric, director of public affairs at Parity, told cointelegraph: Because the parachain is a different type of smart contract that can be implemented in various operating environments, Polkadot has great potential to expand the existing DeFi ecosystem. He further elaborated:Many of these new DApps and parachains have also received funding from Polkadot’s main sponsor, the Web3 Foundation. Mauric confirmed that the Polkadot treasury is also trustless as a project that hopes to build on the basis of Polkadot
Funding
. So, who is involved in Polkadot's DeFi ecosystem, and how do they compare to rival Ethereum?secondary title。
Acala is a decentralized financial center known as a "one-stop DeFi service center". It offers some features similar to Maker, allowing users to lend and borrow its aUSD stablecoin. However, it also operates a decentralized exchange under an economic model known as a “decentralized sovereign wealth fund” designed to provide an ongoing means to maintain the ecosystem’s growth. Acala is also one of the first companies to participate in a new Polkadot-specific crowdfunding model known as
First Parachain Issuance
Acala is the first overcollateralized stablecoin project developed using the Substrate framework. Acala co-founder Bette Chen told Cointelegraph: “For example, by using Substrate to build Acala, we can customize the fee schedule and allow users to pay fees in any acceptable token. The benefits of innovation are limitless, because we can add New features and bug fixes without the need for a hard fork.
secondary title
Mortgage and Lending PlatformMantra DAO is a community managed DeFi platform for staking, lending and governance. The platform’s OM token confers voting rights that affect various factors, such as inflation levels or interest rates. Mantra DAO will run on RioChain infrastructure and is becoming a fully decentralized DAO managed by its community.Another project, StaFi (short for Staking Finance), is a protocol that allows users to release liquidity in staked tokens. It works similarly to Yearn.Finance or Compound, issuing synthetic tokens, rTokens, which represent equity in the pool and can be used in other protocols. In addition to funding from the Web3 Foundation, the project also
Get the support of B-Tech
, B-Tech is the technology accelerator of Bitmax Exchange.
secondary titleDEX and liquidityAnother project, Equilibrium, migrated from the EOS blockchain to Polkadot. It started as a MakerDAO replacement, but with the migration to Polkadot, it
plans to expand its product range
, including decentralized exchanges, synthetic asset platforms, and new interoperable stablecoins.
secondary title
Moonbeam is a Polkadot parachain to Ethereum that enables developers to build Ethereum-compatible smart contracts. Through Moonbeam, DApps can be integrated with other blockchains, including Bitcoin. This also means that existing Ethereum-based frontends can connect to Moonbeam to interact with Polkadot-based DeFi applications.announcedMoonbeam has found a tacit understanding with Ethereum-based DeFi projects, and these projects hope to expand to Polkadot. it
announced
A number of partnerships with prominent DeFi projects include SushiSwap, BetProtocol, and Linear Finance, with Yoo saying there are many more in the pipeline.
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DeFi infrastructure
Ethereum DeFi has grown up, with many innovators emerging and building on their predecessors. However, many projects on Polkadot see an opportunity to use Polkadot parachains to build an infrastructure layer for cross-chain transfer of assets and transactions.Rio DeFi's RioChain is a Polkadot parachain built using Substrate and provides a ready-made toolkit for DeFi DApp builders. These include the RIO generic asset bridge, which enables simultaneous cross-chain transfers of multiple assets. All of Rio's core tools are accessible through the project's website interface, including the Rio Wallet and Rio Block Explorer.The team behind RioChain foresees multiple cross-chain DeFi use cases, including a bitcoin lending platform, a bitcoin savings account app, and instant stablecoin loans based on cryptocurrency portfolios. Additionally, RioChain believes that the elimination of intermediaries such as PayPal that generate lucrative revenue from merchant payments has the potential to disrupt the global e-commerce payment market.
Launched its own parachain Clover on Polkadot
. To facilitate the growth of DeFi, Clover will seek to leverage cross-chain capabilities and include some of Bithumb Global's own internal applications, decentralized exchanges, wallets, and lending protocols. Norelle Ng, managing partner of Bithumb Global, told Cointelegraph that the availability of infrastructure layers like Clover will ultimately help improve the user experience of DeFi: “The modules provided in Clover will greatly reduce the technical development threshold for upper-layer applications.”
Akropolis is a project built on Ethereum that provides DeFi DApp developers with an open-source protocol — effectively a DeFi operating system. In the context of Polkadot DeFi, it has received funding from the Web3 Foundation to provide a platform-as-a-service for Substrate nodes. It also provides a mortgage entry as the front end of the Polkadot chain. Akropolis is already integrated with Ethereum DeFi DApps, including Compound and Aave.
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"Polkadot DeFi still has a long way to go"
Based on the scale of development, Polkadot DeFi looks promising. Many projects have already begun to take advantage of the interoperability provided by the system. Polkadot is also trying to make headway in attracting developers from other platforms.
However, due to the current lack of composability between Ethereum and Polkadot applications, it will take some time before interoperability is achieved. For example, it is currently not possible to arbitrage flash loans on one platform across different decentralized exchanges on other platforms. Polkadot is achieving composability, Mauric said, acknowledging that this is a critical development.
For DeFi and Web 3.0 in general, cross-chain composability is a must. We’ve already seen the hunger for a trustless, pegged Bitcoin in Ethereum to be used in DeFi, a clear early sign that cross-chain connectivity and composability are to come. Addressing cross-chain composability is an important milestone.
