invites you to know what Polkadot's ecological projects are?

Apart from Cardano, Polkadot is currently one of the most popular cryptocurrency projects in the field.

And there's a very good reason.

Featuring unique technology and innovative concepts, this encryption project tries to solve one of the most potential problems in the industry: interoperability.

Based on this, there are more than 300 projects under construction at Polkadot. In this article, we're going to sort out some of the most interesting projects to explore.

Polkadot 101: Basic knowledge of Polkadot

Before we dive into specific projects, let's review the basic situation regarding Polkadot.

Polkadot was founded by the Web3 Foundation in 2016. It is a decentralized and open source Web3 blockchain interactive operating platform.

The main purpose of this agreement is to connect various blockchains that were not originally connected, including private chains, public chains, alliance chains, and oracle chains.

Polkadot's main chain is referred to as the relay chain, and its function is to function as a communication hub between different parasites, while providing security for the entire network.

Parachain is an independent blockchain that runs on a chain of relays. Each blockchain has a unique purpose in the Polkadot ecosystem. Even though they run in parallel with the main blockchain, parachains can communicate with each other via the Cross-Chain Message Passing (XCMP) protocol.

Parathread is similar to parallel chains. However, the latter has a dedicated slot to provide continuous uptime for its chain, while parallel lines are slots that are shared between groups, and the operating frequency is relatively low.

On the other hand, bridges are responsible for providing interoperability for Polkadot, connecting networks, and enabling transactions between various blockchains.

Another important part of the project is the original DOT token, which has three core functions:

Participate in network governance;

Implement a Proof-of-Stake Nomination (NPoS) consensus mechanism;

Bind (DOT key to add new parasain).

Based on the Polkadot architecture, the blockchain network has a high level of security and scalability (main chain TPS up to 1,000 transactions per second, and TPS with parachain up to 1 million). Especially when you are familiar with Bitcoin or Ethereum, you will find that DOT transaction speeds are very, very fast.

In addition, it should be mentioned that Polkadot can upgrade the network without soft forks and hard forks to prevent future forks.

Polkadot's top five ecological projects

1. Kusama

Kusama  is one of Polkadot's most popular ecological projects. It starts from the same foundation as Polkadot.

Kusama is known as Poka's "wild cousin" and functions as a network of walnuts for the entire ecosystem.

Much like miners have used walnuts to detect the presence of carbon monoxide in the past, Kusama serves as Polkadot's testing platform with the aim of experimenting with new features, finding bugs and potential vulnerabilities and fixing them.

Simply put, every new version or component that has not been tested and reviewed will be implemented first in Kusama, Kusama and Polkadot having the same code base.

The great thing about Kusama is that it's not just a testnet. It displays its own KSM token, and at the same time gives the user the option to explore new features that may emerge from Polkadot.

Before parachuting and new projects added to Polkadot, you'll see them in Kusama first.

2. Acala Network

Acala Network  is the center of Decentralized Finance (DeFi) and stablecoin platform in Polkadot.

The core component of the project is the Acala Dollar (aUSD), which is a stable currency linked to multiple assets, each with a value of 1 US dollar.

The interesting thing about USD is that, unlike DAI and other decentralized stablecoins which are based on a single network, the Acala Dollar can be used across multiple blockchains due to Polkadot's interactive operation functions.

Apart from stablecoins, the entire Acala ecosystem also functions across platforms and consists of different DeFi applications, such as loans, liquidity pledges, atomic swaps and oracle pricing solutions.

Acala also has its own native currency, ACA, which will serve as a token for network governance and utilities, and at the same time provide an emergency solution to the sudden collapse in mortgage asset prices on the protocol.

Interestingly, although the mainnet has not yet launched, the project  raised $  7 million from investors in August 2020.

3. Reef Finance

Reef Finance  is an interesting crypto project based on Polkadot. This project tries to solve the liquidity problem and related DeFi results by linking the respective protocols and decentralized solutions to the platform.

The special thing about Reef is that the DeFi protocol can collect liquidity from multiple sources in an encrypted market via global liquidity aggregator solutions, including decentralized and centralized exchanges.

Therefore, users will be able to trade and exchange digital assets more effectively and reduce slippage.

Reef does the same for different and popular DeFi activities - such as borrowing, lending, promising, and mining for liquidity - through an intelligent AI-driven income farm aggregator to provide users with the best interest rates.

Another key function of the platform is intelligent asset management, which provides users with a variety of portfolio management functions, such as active asset rebalancing, guided asset management and diversified investing.

The project has REEF native tokens, which went public in September 2020 and raised nearly 4 million US dollars.

Apart from governance, REEF can also be used to pay protocol fees, co-promise, and be used for distribution of rates of return.

4. Centrifugal machines

Centrifuge  is a DeFi project, designed to be compatible with Ethereum and Polkadot using the Substrate framework.

The Centrifuge Ecosystem consists of two main products: Centrifuge Chain and Tinlake. The first is the main blockchain driven by its original Radial governance token (RAD), while Tinlake is a dApp that uses smart contracts for asset securitization.

This project aims to link financial technology and decentralized financial space, enabling companies to tag real-world unrealized assets (NFTs) (such as invoices, royalties, and mortgage loans) to borrow funds and get liquidity from bank participation.

To achieve this goal, investors use two different token structures to provide liquidity: TIN and DROP.

These two coins represent the liquidity that users provide to the Centrifuge pool of funds and provide interest to holders over time. However, a TIN involves more risk and potentially higher returns, while a DROP can prevent default and provide investors with lower returns.

Apart from empowering the DeFi field in the form of an NFT, Centrifuge also allows companies to increase liquidity for their normally illiquid assets and obtain more funds without having to go through the expensive securitization process of traditional finance.

5. Moonlight

The Polkadot relay chain does not have the capability to natively support smart contracts.

However, the Moonbeam encryption project is   trying to change this situation by implementing an Ethereum-compatible smart contract relay chain on Polkadot.

Once Moonbeam is launched on Polkadot, it will add smart contract functionality to all other parachains and cross-chain bridges connecting other networks and blockchains (such as Ethereum or Bitcoin).

Because the project chain supports Web3 and the Ethereum Virtual Machine (EVM), as well as popular development tools such as MetaMask and Truffle, developers can easily deploy existing smart contracts on Moonbeam with minimal configuration changes.

Therefore, Ethereum-based encryption and DeFi projects can expand their scope by creating cross-chain solutions, or transfer their existing workloads to Polkadot, avoiding the current high Ethereum gas costs with minimal effort.

Moonbeam has its own original utility token, Glimmer (GLMR).

The main objectives of GLMR include participating in on-chain governance, paying for smart contract execution and transaction fees at Moonbeam, and staking to support network operations.

Interestingly, based on the Ocean Protocol decentralized data exchange blockchain announced earlier this year, the Boca solution and  Moonbeam platform integration will be carried out  .

Polkadot's next plan

Polkadot launched the relay chain in May 2020 and has since attracted many interesting projects.

Although the network initially used a Proof of Authorization (PoA) consensus mechanism, it later evolved into the NPoS blockchain. After that, on-chain governance and balance transfer are realized.

Polkadot is currently in the most exciting stage, at this stage we will see the realization and launch of several parasains on the relay chain.

However, there are a few steps before launching parachuting at Polkadot.

First, the community should run tests on the Parachain and Kusama test networks to remove bugs and potential vulnerabilities and ensure a stable release.

As a final step, if all goes well during the test period, the community will start the parachain slot rental auction, and the user will select a project to launch on Polkadot.

According to the project, the Parachain slots will be auctioned off individually, and each auction will last about two weeks.