5 Polkadot Parachain Projects to Watch in 2022

Parachains are independent blockchains that work alongside the main blockchain in the Polkadot ecosystem. Each parachain has its own niche, and transactions are all carried out on the parachain network, thus preventing blockage of the Polkadot main chain blockchain.

Projects aiming to become parachains on the Polkadot network must win parachain slot auctions through a "crowd lending" process. Crowdlending enables backers to temporarily lend their DOTs to help a project of their choice win an auction.

In this post, we'll examine five innovative Polkadot parachain projects.

1.Centrifuge

Centrifuge is a decentralized finance (Defi) lending protocol that promises to make it easier for small businesses to get loans while providing investors with predictable income by bringing centralized liquidity to traditional financial markets.

The protocol is based on Parity Substrate, a framework for building distributed blockchain systems on Polkadot and Kusama networks. The platform’s decentralized application, Tinlake, is a marketplace for tokenized real-world assets where users can issue NFTs as collateral for loans, allowing them to receive liquid cash from lenders.

In exchange, investors can use standard corporate financing methods for a more predictable return on investment and protect themselves from the volatility of the cryptocurrency market.

The platform is powered by the Centrifuge Token (CFG), which provides blockchain security while also enabling holders to pay transaction fees, stake assets, and participate in Centrifuge’s governance.

2.Bit.Country

Bit.Country is a platform that allows users to create 3D worlds in which they can also create games and applications. The protocol aims to develop varying degrees of social engagement through typical social media platforms and 3D virtual worlds such as Decentraland. The platform also aims to integrate virtual reality (VR) into its ecosystem. Users will be able to create their own NFT galleries, including marketplaces, tokens, and community governance.

Users can create their virtual country, which is a Bit.Country map with limited points. Its final form will be determined entirely by community members. To encourage individuals to contribute to the community, landowners will be able to create or import their own tokens.

Community members can use these funds to purchase assets, pay for services, and even participate in community governance. Landowners set incentives, which may take many different forms (content creation, hosting events, sharing, etc.).

3.Acala

Acala is a cross-chain decentralized financial protocol that aims to become the Defi center of the entire Polkadot ecosystem. In addition to DOT-based assets and derivatives, the Acala platform also provides Polkadot’s native decentralized stablecoin, as well as DOT (LDOT) liquid collateral alternatives, and interoperability with the Ethereum Virtual Machine EVM.

Acala consists of two basic protocols. The first is the Honzon system, a decentralized stablecoin protocol that allows the minting of Acala dollars or aUSD, a digital asset collateralized by a USD stablecoin.

The second protocol is Homa, a tokenized valued liquidity protocol that allows Defi protocols built on Polkadot to utilize a tokenized form of valued DOT known as LDOT.

Acala has also created a cross-chain DEX that will include encapsulated assets like renBTC that can be used as collateral to mint USD stablecoins, which I think is amazing. If you've tried searching for it on CoinMarketCap or CoinGecko, the platform's native utility token is ACA. Chances are you didn't find anything.

4.Moonbeam

Moonbeam, a blockchain network in the Polkadot ecosystem, is developing a smart contract platform. The purpose of Moonbeam is to combine the scalability and interoperability of Polkadot with the previously known Ethereum smart contract development toolset.

Moonbeam provides a platform where Ethereum developers can move their Ethereum-based dapps into the Polkadot ecosystem. By providing a full implementation of the Ethereum Virtual Machine (EVM), developers can also build new applications using the development tools they are already familiar with.

Decentralized applications on the Moonbeam platform benefit from the security of the Polkadot relay chain while being able to interact with other parachains connected to the Polkadot relay chain.

Glimmer (GLMR) is the cryptocurrency of the Moonbeam project, and it works similarly to ETH on the Ethereum network. On the Moonbeam platform, GLMR is used for transactions and smart contract execution. However, GLMR is also used for staking and on-chain governance.

5.Efinity_

Efinity is a blockchain network created by the Enjin team. The project aims to provide an efficient and scalable platform for the minting, transferring and trading of NFTs. The Efinity team expects that the platform will be able to process 700 to 1,000 transactions per second, with a verification time of approximately 6 seconds per transaction.

The platform has a native token called EFI that is used to pay transaction fees, staking, governance and reward users to keep the network running. In Efinity's NFT marketplace, EFI will be used as a currency.

in conclusion

In this post, we examine five different Polkadot parachain projects and their uses. Polkadot aims to support up to 100 parachains, so we may see more innovative blockchains connected in the Polkadot ecosystem over time.