Parachain Slot Auctions

Blockchains that break down walls.

Parachains are advanced, next generation blockchains that transcend the limitations of legacy blockchain networks. Together they form the Kusama ecosystem, an interconnected network of specialized chains breaking down the walls of the centralized web.

Kusama parachains are launching now—find out how you can contribute by joining parachain crowdloans.

Parachains = Possibilities

While other blockchain networks only allow developers to build DApps using smart contracts, Kusama gives them full control over the underlying blockchain itself. This flexibility gives parachain developers the maximum freedom to optimize for any specific use case—which means better and more secure DApps and services for all.

Legacy blockchains
1-size-fits-none

A single, limiting design for the entire network. No ability to optimize for specific use cases, so compromises and tradeoffs must be made.

Parachains
Specialized

Parachains are specialized for a multitude of use cases, enabling more optimized services and thriving, multifaceted economies.

Legacy blockchains
Isolated

Most blockchains are like walled gardens, cut off from each other and unable to communicate, prohibiting the free flow of data and commerce.

Parachains
Interconnected

Parachains are a rich, interconnected ecosystem where data flows freely between chains, leading to innovative new interoperable services.

Legacy blockchains
Limited scalability

Transactions are processed one-by-one, leading to bottlenecks, network congestion and high fees when DApp usage spikes.

Parachains
Scalable

Prachains process transactions “in parallel”, spreading them across the entire multichain network for maximum scalability.

Legacy blockchains
Difficult to
upgrade

Like all software, blockchains need periodic upgrades to stay relevant. Upgrading most blockchains is painstaking, making them slow to evolve and respond as new technology becomes available.

Parachains
Seamless on-chain
upgrades

Kusama makes upgrading a blockchain more like upgrading a conventional app, with the ability to make most updates seamlessly and automatically in the background.

Legacy blockchains
No financial agency

Legacy blockchains are dependent on centralized organizations to finance activities that benefit the network, and communities as a whole have no financial agency.

Parachains
On-chain treasuries

Parachains can leverage on-chain treasuries, giving decentralized communities the financial agency once limited to corporations and governments.

Legacy blockchains
No clear decision
making

Most blockchains have no formal governance procedures. Individual stakeholders are often powerless to propose changes, with decisions made by opaque groups of insiders.

Parachains
Built-in, customizable
governance

Parachains can leverage Kusama’s built-in, transparent governance features or create their own to implement the system that’s best for their community.

Legacy blockchains
Difficult and costly
to secure

Securing blockchains requires a massive amount of resources, creating a significant barrier to entry for new chains and leading to competition for scarce resources between chains.

Parachains
Built-in
security

Parachains get robust security automatically when they connect to Kusama—no need to bootstrap their own network of miners or validators.

Legacy blockchains
Difficult and costly to
build and maintain

Building a conventional blockchain typically takes years of hard work and large teams of experts. Maintenance is costly and time consuming.

Parachains
Streamlined development with Substrate

Parachains can use the Substrate blockchain framework to drastically simplify and speed up development and maintenance.

Legacy blockchains
High, unpredictable
transaction fees

Fees on blockchains are often unpredictable, fluctuating based on short-term network usage and congestion.

Parachains
Low, transparent
fees

Transaction fees are known in advance and fee structures can be customized by parachain teams. Users can pay fees in the parachain’s native token.

Legacy blockchains
Limited transaction
types

Blockchains and smart contracts are typically limited to a few basic transaction types, like sending funds or triggering a contract. Transactions between chains are limited and often mediated by centralized services.

Parachains
Any type of
data

Kusama allows any type of data to be sent between DApps and parachains, creating an interoperable internet of blockchains and opening the door to a host of innovative new services.

A parachain for every purpose.

Parachains can be built for any blockchain use case, from DeFi to identity and supply chain, gaming and NFTs, IoT, DAOs, and much more. They can also take on various forms depending on their intended function, including:

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Independent token economies
Parachains with their own tokens, fee structures, and economic ecosystems.
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Smart contract parachains
Platforms for hosting smart contract based DApps and services.
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Common good parachains
Designed for the benefit of the entire Kusama ecosystem, common good chains typically use the network’s native token, KSM.
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Parachain hubs
Parachains that provide a range of functionality to serve a broader community or use case, for example DeFi hubs and governance hubs.
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Bridge parachains
Bridges allow Kusama parachains to connect to external networks like Polkadot, Bitcoin and Ethereum.
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Parathreads
Pay-as-you-go parachains for early stage networks and those that don’t need continuous connectivity to Kusama.

Parachains as autonomous agents

Parachains can act autonomously based on the will of their communities to participate in Kusama governance and allocate on-chain treasuries. This opens the door to new decentralized funding models, from project funding to decentralized sovereign wealth funds and even cross-chain mergers and acquisitions.

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Parachains as digital nation states

With their own communities, rules, economies, governance, treasuries, and relationships with external chains, parachains are akin to decentralized digital nations. Kusama allows them to come together, communicate and share security guarantees for the betterment of the entire ecosystem.

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Parachain Slot Auctions & Crowdloans

Parachains connect to Kusama by leasing a parachain slot via auction. Parachain slots can be leased for up to 1 year at a time with the option to renew, and grant the parachain continuous connection to the network for the duration of the lease.

How auctions work

Bonding

To bid in an auction, parachain teams agree to lock up (or bond) a portion of Kusama’s native token, KSM, for the duration of the lease. While bonded for a lease, the KSM cannot be used for other activities like staking or transfers.

Auction cost

After the lease, the full amount of KSM is unlocked, meaning auctions do not require teams to “spend” KSM. The cost of running a parachain on Kusama is best characterized as the opportunity cost of not being able to use the bonded KSM for other activities.

Crowdloans

Some parachain teams will fund their bid with the help of a crowdloan campaign, which allows them to accept contributions from KSM holders. Crowdloan contributors get their KSM back at the end of the lease, and parachain teams can choose to reward them in various ways, including with a distribution of the parachain’s native token.

Auction Duration

Auctions on Kusama have an open bidding period of approximately 1 week. At the end of the week, the precise moment of the auction’s close is determined retroactively. This prevents last-minute “auction sniping” and promotes more accurate price discovery. Parachains can onboard to Kusama immediately after the auction.

Learn more about how auctions and crowdloans work in this in-depth video explainer.

Participating in a crowdloan

Be part of blockchain history by helping kick start your favorite Kusama parachains. Crowdloans raise the bar for blockchain teams, pushing them to demonstrate their technology first and get support from KSM holders in order to launch. Here’s how it works:

DYOR

Thoroughly research the parachain project and team, and read the details and conditions of their crowdloan campaign. Given that Kusama is a decentralized network and crowdloans are conducted independently by independent teams, it’s important to do your own research. Make sure you only get information from official channels. If ever in doubt, ask in the crowdloan Discord chat.

Learn how to protect
yourself

Read this guide for the basic tips on avoiding scams. If you’re inexperienced using blockchain technology, make sure you’re aware of basic best practices like how to protect your secret keys.

Determine where you will participate

Teams can choose to host their crowdloan campaigns natively on Kusama and/or via third party intermediaries. For Kusama-native crowdloans, you can participate on Polkadot-JS. If you’re less experienced using blockchain technology, you may find it easier to participate in a non-native campaign. Find out where you can participate here.

Create a Kusama
account

You’ll need a Kusama account with a free balance of KSM to contribute to a Kusama-native crowdloan. Watch the video to learn how to create an account on Polkadot-JS.

Make your
contribution

Watch the video below to learn how to contribute via Polkadot-JS.

Have a question about crowdloans?

Join the Discord chat

This bird breaks down walls.
Parachain launch NFTs

Three limited edition NFTs were created to celebrate the launch of Kusama parachains. Representing three interpretations of the Kusama canary by Berlin street artists Awer, Vidam and Andreas Preis, the paintings were created on a section of the Berlin wall now used as an open canvas for free artistic expression. The collection was limited to 9,999 NFTs, which have already been claimed.

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