From Moonbeam to Bittensor, learn about some of the most iconic projects in the Polkadot ecosystem

The long-dormant Polkadot network began to show signs of recovery on December 20, a phenomenon that began with a surge in transaction volumes. On that day, the number of transactions on the Polkadot Relay Chain exceeded 1 million, which is a remarkable number. Behind this rally was triggered by an event called Inscription.

Over the next two days, the Polkadot Relay Chain continued to record high volumes. On December 21, the number of transactions reached 5,970,000, and on December 22, it reached 6,930,000. These numbers far exceed any record since 2021, when the previous record was 941,000 transactions, set on May 5, 2021.

Notably, on December 22, Polkadot processed a staggering 6.9M transactions, with an average of 416 transactions per block, which equates to 70 transactions per second. This surge in transactions brought 120,000 DOT in fees, of which 96,000 DOT went into the treasury, equivalent to a value of $768,000. WHAT’S EVEN MORE SURPRISING IS THAT THE FEES FOR A SINGLE TRANSACTION ARE ONLY BETWEEN 0.01 AND 0.017 DOT, WHICH EQUATES TO $0.08 TO $0.15 PER TRANSACTION.

The surge in transaction volume triggered by this inscription event is not only a numerical magnificence, but also a demonstration of the superior performance and great potential of the Polkadot network. As a result, many investors are beginning to believe that the value of the Polkadot ecosystem is grossly undervalued.

Looking back on 2023, the Polkadot ecosystem has made a series of positive progress

2023 has been a pivotal year for Polkadot, with a series of constructive results, as follows:

1. The establishment of DotLake: The year 2023 saw the establishment of DotLake, a scalable and cost-effective data platform hosted on the Google Cloud Platform. The architecture of the DotLake platform has been carefully designed to optimize the storage and processing of large amounts of data from more than 70 Polkadot and Kusama chains. The emergence of this platform simplifies the handling of all blocks, events, and external factors, significantly improving Polkadot’s data transparency and accessibility.

2. Launch of OpenGov: In June 2023, the launch of OpenGov revamped Polkadot’s governance system, emphasizing direct community control and efficient decision-making. This initiative strengthens the community’s position in the development of the Polkadot network and facilitates a more efficient decision-making process. After the launch of OpenGov, there was a noticeable increase in the number of proposals.

3. Release of Polkadot 1.0: In July 2023, the release of Polkadot 1.0 realized the original vision of heterogeneous sharding and cross-chain interaction, marking an important step towards decentralization of Polkadot. Especially in the financial sector, the launch of native USDC on Polkadot in September enhanced the ecosystem’s Stable Coin functionality, supporting the development of more financial applications.

4. The height of the Satoshi Nakamoto coefficient: As of November 2023, Polkadot’s Satoshi Nakamoto coefficient has reached 93, which indicates that its degree of decentralization is very high. The improvement in this indicator reflects the healthy and stable development of the Polkadot network.

5. INFLOW OF TREASURY ACCOUNT: IN 2023, THE TREASURY ACCOUNT WILL RECEIVE 1.825 MILLION DOT.

6. There are two different forms of inflows into the treasury account: bounties and proposals. IN 2023, ABOUT 5.356 MILLION DOT LEFT THE TREASURY IN THE FORM OF PROPOSALS, WHILE 949,000 DOT WERE PAID THROUGH BOUNTIES. Most of the DOT inflows into the treasury come from the share of online inflation, and other sources include network transaction fees and miscellaneous transfers from other wallets to the treasury. Overall, inflows into the treasury account significantly exceeded outflows in 2023.

7. Growth of unique Addresses: In 2023, the number of unique Addresses increased by 44%, from 3.162 million in January to about 4.54 million in November, indicating that the number of users and holders of the Polkadot ecosystem continues to increase.

8. Developer contributions: More than 800 different developers contribute to Polkadot’s codebase every week, which shows the activity and diversity of the developer community.

9. XCM v3 Merge: In January of this year, the XCM v3 Merge brought advanced Programmability, improved bridging, and support for Non-fungible Tokens. Looking at the data, XCM parachain activity increased by 60% month-over-month, which shows Polkadot’s continuous improvement in supporting cross-chain interaction.

How Polkadot 2.0, which will be launched in the first half of next year, will transform the project ecology, many ideas have led to speculation

Developing on the Polkadot ecosystem has always been relatively costly, but Polkadot 2.0, which is expected to go live in the second quarter of next year, is expected to bring about an important change. Polkadot’s architecture includes relay chains, parachains, parathreads, and bridge chains. The Relay Chain is Polkadot’s main chain and is responsible for the security and ecological governance of the network, but it does not support Smart Contract functions. Therefore, there are currently two main ways to develop applications on Polkadot: one is to become a parachain of Polkadot, and the other is to build applications on the Polkadot parachain.

To become a Polkadot parachain, you need to participate in the bidding slots, which is more expensive to develop, because the cost of bidding slots is also relatively expensive, and the investment promotion of the Polkadot parachain adopts the form of pledge auction. A more viable option for the average developer is to build an application on Polkadot’s parachain, which is relatively cheaper.

According to the Polkadot Forum, Agile Coretime (Polkadot 2.0) plans to launch the Rococo Testnet at the end of the year, followed by the Kusama Pioneer Network in the first quarter of next year and the Polkadot Mainnet in the second quarter. This means that projects will soon have direct access to the Polkadot Relay Chain service without having to rent parachain slots for long periods of time. This will greatly drop the barrier to entry for development on the Polkadot chain, thereby stimulating the activity of the ecosystem.

In addition, in November 2023, the Polkadot ecosystem also launched a grant program called “Decentralization Futures”, which aims to fund the developers of the Polkadot ecosystem. The project will provide a total of $20 million and 5 million DOT to support Polkadot-focused organizations, both for-profit and non-profit. This financial support program will help to further promote the innovation and development of the Polkadot ecosystem.

In general, the imminent arrival of Polkadot 2.0 and the financial support projects in the ecosystem have brought more opportunities and potential to the Polkadot ecosystem, as well as a broader development space for developers and projects. This will help drive the rapid growth and prosperity of the Polkadot ecosystem.

Take a look at some of the most popular projects in the Polkadot ecosystem: from Moonbeam to Astar Network

The following is a review of the representative projects in the Polkadot ecosystem.

Moonbeam: Create a native Ethereum execution environment to drop migration costs for developers

Moonbeam, as a parachain of the Polkadot ecosystem, provides a Smart Contract platform compatible with Ethereum, which is a welcome feature. Based on the Substrate technology framework, Moonbeam is able to create a native Ethereum execution environment that provides Web3 RPC and EVM implementations, which are perfectly compatible with most Ethereum DApp (Decentralization applications), saving developers a lot of time and money for migration.

Compared with other contract systems in the Polkadot ecosystem, such as Acala, Plasm, Patract, etc., Moonbeam has obvious advantages in the following two aspects:

High applicability and high stability: There are many EVM-compatible public chains on the market, but their stability and security often face various vulnerabilities and challenges. Moonbeam chose Froniter as the solution module, placing a high value on compatibility with Ethereum, not just a slogan. This means that developers can build applications on Moonbeam without worrying about compatibility and stability.

Engaging Developers and Users: Moonbeam actively supports developers, including Developer Grants and Grants, to support developers in terms of funding and technical support. In addition, Moonbeam is committed to making the migration to Moonbeam more comfortable for users by providing an environment that is easier to use and understand.

In the Polkadot ecosystem, Moonbeam, in partnership with Parity and OneBlock, is hosting the Winter 2023 Polkadot Hacker Marathon until December 22. Moonbeam offers two Bounty challenges, one involving developing LST (vToken) applications based on Moonbeam’s EVM-compatible environment, and the other about Web3 gaming projects. The Moonbeam team encourages developers of all sizes to participate in the competition, and they look forward to seeing Web3 games of all genres, from role-playing games to platformers, bring more diverse applications to the Polkadot ecosystem.

Moonbeam also offers a variety of precompiles that can be accessed through a simple Solidity interface, providing developers with powerful features. These precompilations can improve the user experience, such as implementing gas-free transactions, batch transactions, randomness, and more. Developers can take advantage of these precompiles to build great apps on Moonbeam and stand a chance to win prizes.

There are already a number of Moonbeam-based games available, including Moonscape, Evrloot, Playtge, Blockchain Monster Hunt, and more, that enrich the Moonbeam ecosystem and provide users with more opportunities for entertainment and engagement. The future of Moonbeam is exciting, as it breathes new life into the diversity and innovation of the Polkadot ecosystem.

Acala: 80% of Transaction Fees have been burned, but a new burning mechanism has been introduced

Acala is a financial service platform built on the Polkadot network that specializes in providing liquidity centers for the Polkadot ecosystem and aims to drive financial innovation. It provides the Polkadot ecosystem with important financial features such as lending and stable coins. Acala can be considered Polkadot’s Decentralized Finance (DeFi) hub, as it is the first Decentralized Finance protocol developed through the Polkadot parachain auction, providing a robust financial infrastructure for the entire ecosystem.

Acala launched the Acala 2.0 program in September 2023, introducing AcalaStaking and Exodus network upgrades, while also making updates and improvements to the Token economy.

ACA is the governance Token of Acala, which officially launched the Acala Staking program through a referendum on October 16, 2023. The program aims to set a 10% target annual Intrerest Rate (APR) for ACA staking and encourage community members to actively participate in staking to drive ecosystem security and governance.

In addition, Acala has developed new regulations on Token Emissions and Burning to create a more balanced ecosystem. Under the new rules, a total of 100 million ACAs are emitted annually, with 50% of the emissions going to ACA staking, while the other 50% is used to help build liquidity and promote ecosystem adoption. In addition, the network regularly burns a portion of the unused Token issuance, for example, 1% per month, and a portion of the accumulated network fees, for example, 20% through governance. The goal of these measures is to increase the scarcity and value proposition of ACA, which is expected to enhance its value over time.

The continuous development and improvement of Acala provides a robust financial infrastructure for the Polkadot ecosystem, providing more financial tools and opportunities for users and developers. It plays an important role in driving the DeFi revolution and is expected to continue to contribute to prosperity and innovation across the ecosystem.

Astar Network: A multi-chain smart contract platform that supports multiple L1 blockchains and multiple smart contract engines

Astar Network is a parachain built on Polkadot Polkadot, a multi-chain Smart Contract project formerly known as PALSM and developed based on the Substrate technology framework. Astar’s goal is to be a multi-chain Smart Contract platform designed to support multiple L1 Blockchains and multiple Smart Contract Engines. Developers can build a variety of applications on Astar Network without worrying about scalability and interoperability.

Recently, the Polkadot parachain project Astar has entered a new phase with the launch of Astar Tokenomics 2.0’s staking mechanism. Currently, the Astar network has burned 80% of transaction fees, but has introduced a new burning mechanism, DApp Staking burning.

Specifically, the DApp staking mechanism classifies projects based on their value to the Astar network. This means that as the value of the Astar ecosystem increases, projects that receive community support will receive more rewards. This mechanism encourages the active participation of great developers and provides them with greater incentives. However, it is important to note that each tier has a limited number of vacant slots, and if some slots are not filled, the rewards normally given to those slots will be permanently destroyed. This means that unused rewards will be burned, helping to maintain the health of the Astar network.

Sota Watanabe, founder of Astar Network, revealed that the construction of STRToken Economic Model 2.0 is currently two-thirds complete, and the remaining third is expected to be delivered by the end of the year. After the activation of the new Token economic model, the inflation rate of the ASTRToken will be Halving, and the network will also introduce a new DApp staking mechanism, which is expected to inject more vitality into the long-term development of Astar Network and promote the prosperity of its ecosystem. These changes will help ensure that Astar Network continues to grow and provide innovative financial solutions within the Polkadot ecosystem.

The DePin project occupies an important position in the Polkadot ecosystem, and a series of innovations are worth paying attention to

Recently, the market has speculated on a series of DePin projects, and the DePin project of Polkadot Ecology has unique advantages and prospects. DePin project refers to a Decentralization hardware network project, which usually includes two parts: building a Blockchain network and a hardware device network. For hardware device networks, a special Consensus Mechanism is usually required to evaluate participants’ support for the hardware network and assign corresponding rewards.

Among the existing chaining tools, such as Polkadot’s Substrate framework, Cosmos’s Cosmos SDK, and OP Stack and other Layer2 chaining tools, the Substrate framework is the only tool that can provide the most comprehensive and customizable chaining tools. It does not limit developers to a specific Consensus Mechanism, allowing developers to use a custom Consensus Mechanism and quickly build a Blockchain, which is highly compatible with the needs of the DePin project. Therefore, the Polkadot ecosystem can spontaneously breed more DePin projects, and compared with other multi-chain ecosystems, the Polkadot ecosystem has greater potential in this field.

Here are some of the DePin projects that have attracted much attention in the Polkadot ecosystem:

Bittensor: Enables collaborative training of machine learning models in a distributed environment

Bittensor is an Open Source protocol that powers Decentralization, Blockchain-based machine learning networks. The project aims to facilitate collaborative training of machine learning models in a distributed environment and distribute rewards based on the value of the information they provide to the overall network. Bittensor’s goal is to accelerate the development of AI through an incentive, iterative ecosystem that enables model interoperability and information sharing, and promotes a more equitable, collaborative approach to ownership and access control. The project’s vision is to create a fully Decentralization AI marketplace that provides an open, trustless environment for producers and consumers of valuable goods.

Deeper Network: A cybersecurity and privacy protection infrastructure project based on Blockchain technology

Deeper Network is a network security and privacy protection infrastructure project based on Blockchain technology, aiming to provide users with a freer, safer and more private way to connect to the Internet. Leveraging Blockchain protocols, advanced cybersecurity technologies, and the Substrate development framework, the project is laying a solid foundation for the development of the Web3.0 ecosystem and the future of the Internet. Deeper Network’s core technologies include AtomOS (lock-free network security operating system), Trident Protocol (Decentralization communication protocol), and NPoW (next-generation PoW mechanism). The project also launched hardware products such as Deeper Connect, the world’s first Blockchain-based home network security hardware designed to enable Decentralization of private networks and network censorship bypass.

The emergence of these DePin projects provides new opportunities and prospects for the development of the Polkadot ecosystem, as well as innovation and possibilities for the development of decentralization networks and hardware devices. They will continue to drive the growth of the Polkadot ecosystem and provide users with more choice and security. The successful development of these projects will help the Polkadot ecosystem occupy a more important position in the field of decentralization networks.

Is there an updated narrative for the cross-chain interaction ecology in 2024?

The Polkadot ecosystem is at an exciting time. From the surge in online transaction volume to the emergence of DePin projects, the vitality and innovation potential of the Polkadot ecosystem cannot be ignored. In the annual progress, we saw a series of important milestones such as the establishment of DotLake, the release of Polkadot 1.0, and the launch of native USDC, which laid a solid foundation for the prosperity of the Polkadot ecosystem.

The upcoming Polkadot 2.0 release heralds a major change, which will drop the barrier to entry for developers and further stimulate the vitality of the ecosystem. Projects such as Moonbeam, Acala, and Astar Network demonstrate the diversity and innovation of Polkadot’s ecosystem, providing a wealth of solutions for different fields. At the same time, the emergence of DePin projects offers new prospects for cybersecurity and decentralization hardware devices.

In conclusion, the future of the Polkadot ecosystem is full of opportunities and challenges, and we look forward to seeing more interesting projects and developments, while also hoping that the ecosystem will continue to maintain a neutral and open attitude to provide more possibilities for global innovation and cooperation. The general growth momentum of the Polkadot ecosystem is becoming more and more obvious, and we will pay close attention to its future development.