5 Polkadot Parachains to Look Out for in 2022

Parachains are individual blockchains that work alongside the main blockchain in the Polkadot ecosystem. Each parachain has its niche and transactions are settled on the parachains network, preventing the main Polkadot blockchain from becoming congested.

Projects that aim to become a Parachain on the Polkadot network must win a parachain slot auction, through a “crowd loan” process. Crowd loans enable supporters to temporarily loan out their DOT to assist their project of choice in winning the auction.

In this post, we’ll look at five innovative Polkadot parachain projects.

1. Centrifuge

Centrifuge is a decentralized finance (Defi) lending protocol that promises to make loans more accessible to small enterprises while also providing investors with a predictable income by bringing pooled liquidity into the conventional finance market.

The protocol is based on Parity Substrate, a framework for building distributed blockchain systems on the 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 acquire liquid cash from lenders.

In exchange, investors can use standard business financing methods to get a more predictable return on their investments and protect themselves from the volatile nature of cryptocurrency markets.

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

2. Bit.Country

Bit.Country is a platform that allows users to build 3D worlds, they can also build games and apps to be accessed within that world. The protocol aims to develop various degrees of social engagement across 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, complete with markets, tokens, and community governance.

Users may create their little virtual nation, which is a Bit.Country map with a finite amount of points. Its eventual form will be entirely determined by the members of the community. To encourage individuals to contribute to the community, land owners will be able to create or import their own tokens.

Members of the community can use these funds to buy assets, pay for services, and even participate in community governance. Landowners set the incentive guidelines, which might take many different forms (content creating, holding events, shares, etc).

3. Acala

Acala is a cross-chain decentralized finance initiative that aims to become a Defi center for the Polkadot ecosystem as a whole. In addition to DOT-based assets and derivatives, the Acala platform offers a Polkadot native decentralized stablecoin, as well as liquid staking alternatives for DOT (LDOT) and interoperability with the Ethereum virtual machine EVM, among other features.

Acala is made up of two basic protocols. The first is the Honzon System, a decentralized stablecoin protocol that enables the minting of the Acala dollar, or aUSD, a digital asset collateralized US dollar stablecoin.

The second protocol is Homa, a tokenized staking liquidity protocol that allows Defi protocols built on Polkadot to utilize a tokenized form of staked DOT called LDOT.

Acala has also created a cross-chain DEX that will include wrapped assets like renBTC that can be used as collateral to mint a USD stablecoin, which I think is amazing. If you've already tried searching it up on CoinMarketCap or CoinGecko, the platform's native utility token is ACA. There's a good chance you didn't discover anything.

4. Moonbeam

Moonbeam is a blockchain network in the Polkadot ecosystem that is developing a smart contract platform. Moonbeam's purpose is to combine the scalability and interoperability of Polkadot with the previously known set of tools for Ethereum smart contract development.

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

Decentralized apps on the Moonbeam platform benefit from the Polkadot Relay Chain's security whilst being able to interact with the other parachains linked to the Polkadot Relay Chain.

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

5. Efinity

Efinity is a blockchain network created by the Enjin team. The project's purpose is to provide a platform for minting, transferring, and trading NFTs that is both efficient and scalable. The Efinity team anticipates that the platform will be able to process 700 to 1,000 transactions per second, with each transaction validated in roughly 6 seconds.

Efinity will have a built-in NFT marketplace, allowing users to trade NFTs with one another in a decentralized manner. The protocol also has cross-chain bridges that make it easier for NFTs on other blockchains to migrate over to the Efinity network.

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

Conclusion

In this post, we looked at five different Polkadot parachain projects and their uses. Polkadot aims to support up to 100 parachains so in time we may see many more innovative blockchains that are connected within the Polkadot ecosystem.