This year, while the industry slid headlong into yet another crypto winter, the Polkadot community was busy building and launching the largest and most diverse ecosystem of layer-1 blockchains in the world, with several core technologies rolled out to propel the ecosystem forward into 2023.
With enough happening in the Polkadot ecosystem in 2022 to practically fill a book, it’s no easy task to sum up the past year of activity around the core technology and broader community, but as we move forward into 2023 let’s look back at some of the most important trends and milestones for Polkadot in 2022.
💥 The birth of Web3’s leading ecosystem
The Polkadot community is no stranger to delivering great technology through difficult years, and 2022 was certainly no exception. In just over 1 year since the launch of parachains in late 2021, Polkadot has become the largest and most diverse ecosystem of purpose-built layer-1 blockchains and apps, and the only one fully secured by a shared, network-wide validator set and benefiting from secure, trustless cross-chain interoperability.
To date, 74 parachains have won an auction on Polkadot or Kusama, and are already supporting an ecosystem of well over 300 unstoppable applications according to best estimates. In total, around 550 projects are either launched or under development for Polkadot, a rather impressive start in the network’s first full year with live parachains.
At the time of writing, more than 200 teams have either launched or are building a purpose-built blockchain on Polkadot’s technology stack, recognizing that this model better suits their needs than a smart contract solution, and that Polkadot provides a shorter time to market and a lower cost for building one, as well as the upgradeability and interoperability needed for constant innovation.
Over 130 million DOT and nearly 300,000 KSM have been lent by the Polkadot community through crowdloans to support parachains’ auction bids, a massive show of confidence in the future of the Polkadot ecosystem.
With such a diverse ecosystem, Polkadot has demonstrated to the world that Web3 is about way more than just DeFi and NFT use cases. While Polkadot ecosystem teams are certainly leading the industry forward with bleeding edge DeFi and NFT primitives, Polkadot parachains and dapps span the full spectrum of what’s possible with blockchain technology, from use cases for social media to supply chain, identity, gaming, tokenized real-world assets, carbon credits, privacy, robotics, IoT, and much more.
Some of the major ecosystem adoption breakthroughs this year include smart contract parachain Astar partnering with NTT Docomo, Japan’s largest mobile phone operator, on a $4b investment to promote Web3 adoption, and NFT parachain Efinity partnering with gaming giant Square Enix on Polkadot-powered NFTs for Final Fantasy, one of the top games of all time.
Centrifuge, a parachain leading the onboarding of real-world assets into on-chain DeFi, is leading the largest investment in bringing real-world assets on chain to date with a $220m fund, after securing an investment from Coinbase.
Privacy hub parachain Manta Network is set to have the world’s largest trusted setup in the history of zero-knowledge technology with over 13,000 participants from 177 countries. This technology is essential for building a better, more secure web that keeps sensitive information private, and will allow other builders within the ecosystem to leverage its privacy-preserving features.
2022 also saw an announcement that Project Liberty’s DSNP (Decentralized Social Networking Protocol) will be deployed to Polkadot first, enabling a new era of social media where users control their own data, identities, and connections, a crucial need for Web3. The music industry is also seeing some crucial innovation on Polkadot with Public Pressure, which offers a music NFT marketplace and saw $2m in revenues in a matter of days after launching.
Polkadot’s identity parachain KILT Protocol is also seeing some highly impactful adoption via partnerships with dena, the German ministry of energy and Energy Web, a Polkadot ecosystem project creating an identity registry for Germany’s energy market. Moonsama also integrated KILT’s SocialKYC for decentralized user logins, and KILT became the first parachain to migrate from Kusama to Polkadot.
Polkadot’s DeFi community also got a big boost this year with the integration of the Tether (USDt) stablecoin, the announcement that USDC is also coming to Polkadot, and the launch of the Equilibrium and Polkadex decentralized exchanges.
With its unmatched technology stack in terms of flexibility, scalability, upgradeability, and security, Polkadot is demonstrating that it’s the perfect home for the full spectrum of rapidly evolving Web3 opportunities.
🧭 Leading the path to true decentralization
In 2022, Polkadot made some important strides forward toward the goal of becoming the most decentralized, trustless, and unstoppable Web3 ecosystem.
Events of the past year and the actions of several less than scrupulous actors have demonstrated the importance of these design considerations that are fundamental for Web3. As we’ve seen, centralized systems that require users to place blind trust in intermediaries to act ethically, have their interests in mind, or to be free from corruption or incompetence are systems that put user funds, data, and identities at risk. They’re also at risk of censorship and malicious outside influence.
Step by step, Polkadot has been increasing its level of decentralization and removing areas of centralization that could serve as choke points, becoming one of the largest true DAOs (Decentralized Autonomous Organization) in existence.
Crucially, 2022 saw the initial launch of Polkadot’s next-generation governance system, OpenGov, as it began its rollout on Kusama. The most advanced and sophisticated blockchain governance system ever devised, OpenGov removes the somewhat more centralized role of the Polkadot Council, and decentralizes the network’s entire governance process to the community-driven referenda system. This ensures that decisions can always be made and enacted in an unstoppable, fully autonomous way.
The Polkadot Fellowship also launched this year, a key component of OpenGov. The Fellowship is a decentralized, on-chain and ranked body of technical experts that replaces the Technical Committee and effectively oraclises the technical knowledge base of the Polkadot community. With no ‘hard power’ over network decisions, the Fellowship is designed to help optimize the decision making process of the network without exerting any direct affect on the outcome of those decisions, which remains under the control of all network stakeholders.
It was due in part to these efforts towards true decentralization that, in November 2022 after a 3-year engagement with the SEC, Web3 Foundation announced that the DOT token had morphed from a security into a non-security, a landmark achievement towards the realization of Web3.
Among several other moves to increase decentralization, Polkadot is pushing forward the industry’s most advanced light-client technology, removing the need for users to rely on third-party node services to inspect data and interact with functionality hosted on Polkadot or any Substrate-based chain. The network’s staking system also saw some key upgrades in 2022, including nomination pools, which increase the accessibility of native staking on Polkadot by reducing the minimum stake to 1 DOT, furthering decentralization and trustlessness by making it easier for more people to stake directly on-chain with their own keys.
🚀 Unstoppable innovation
Of course, none of these upgrades would have been possible without Polkadot’s industry-leading upgradeability features. In 2022, Polkadot completed a total of 15 seamless, forkless upgrades, an unparalleled pace of innovation in the blockchain space, for a total of nearly 50 to date. By comparison, Ethereum completed 3 upgrades via hard-fork in 2022 and 4 in 2021. Considering that, in the non-blockchain world, Apple delivered 16 upgrades to iOS in 2022, Polkadot’s ease of upgradeability puts it on par with more conventional software update schedules, ensuring that the technology can continue to evolve at the pace of innovation. To date there have been nearly 1000 forkless upgrades of blockchains built on Polkadot’s technology.
Parachains got a major upgrade to their capabilities on May the 4th, when Polkadot governance upgraded the Relay Chain to v9190, unlocking secure cross-chain data transfer over XCM. After a period of battle testing on Kusama, the launch of XCM on Polkadot delivered the magic of secure cross-consensus bridging to the world. Coupled with the upcoming launch of XCMv3, this will end the ‘weakest link’ problem that has hindered previous-generation bridging technology to the tune of $2.5 billion in losses this past year alone.
Parachain teams wasted no time with XCM, opening over 100 channels and sending an impressive 10,000 messages in the first month. To date, more than 160,000 XCM messages have been sent on Polkadot alone, with an additional 200,000+ messages sent on Kusama, kicking off a new era of secure cross-chain interoperability.
v9190 also heralded the true launch of Statemint, which had first been deployed to Polkadot in December 2021 but now became fully functional. Users could now mint assets, including NFTs, and teleport DOT to and from the Relay Chain, providing fundamental functionality to the ecosystem.
This year also saw the launch of Polkadot’s second system parachain, Collectives, giving people the ability to organize and act as a group without needing to trust third parties like lawyers and courts, a crucial function for Web3. The first such collective to launch was the Polkadot Alliance, a community initiative created to recognize positive contributions to the ecosystem and set a code of ethics around scams, malicious behavior, misuse of the Polkadot brand, and unattributed code.
🏗️ One of Web3’s most active and growing builder communities
If you’ve spent much time around Polkadot’s growing developer community, it should come as no surprise that Polkadot development hit an all-time high this year. With an impressive peak of nearly 2500 monthly active developers in 2022, Polkadot was at or near the top of the pack for the most active developer communities outside Ethereum throughout 2022.
The Substrate Builders Program (SBP), which guides builders along their journey to launching a project, accepted 32 new teams in 2022 from an application pool of 127. To date, 60% of Polkadot's parachains have been part of the SBP.
In support of Polkadot's builder community, Web3 Foundation’s grant program surpassed its 400th project milestone this year, with 150 new grants signed, 267 applications, and 230 grant milestones delivered in 2022.
Polkadot’s decentralized on-chain treasury also paid out a record amount of DOT this year to support projects benefiting the network. To date, more than 4 million DOT have been paid out to teams and individuals for their work supporting the ecosystem, up from a total of about 200,000 at the end of 2021.
Recognizing that a growing ecosystem needs a strong pool of new engineers to fuel it, 2022 was also the founding year of the Polkadot Blockchain Academy (PBA). An intensive academic program designed to give students all the knowledge they need to become a top blockchain engineer, the Academy’s initial wave took place at Cambridge University over the summer with a cohort of 55 students selected from an application pool of 560. The program was a resounding success, taking promising developers from the beginning of their Web3 journey to being hired to work within the Polkadot ecosystem after graduation.
2023 will kick off with the second wave of the PBA, taking place at the University of Buenos Aires (UBA) in January in collaboration with 12 universities in the LATAM region. Applications for the second wave hit nearly 800 in less than 1 month, reflecting the especially high level of interest in Polkadot seen in the region. The organization of subsequent waves has already begun, establishing a growing pool of talented builders to help shape the future of Polkadot.
🌞 Looking ahead
With everything that was accomplished in 2022 and everything on the horizon for 2023, that future is looking bright indeed. This year, Polkadot founders Rob Habermeier and Gavin Wood laid out a vision of new technologies in development for Polkadot which we’ll see launch in 2023 if approved by Polkadot governance.
Perhaps first and foremost among those will be the launch of OpenGov on Polkadot, which will be brought before the Polkadot community for a vote after a period of battle testing on Kusama. Not only will OpenGov bring increased decentralization to the governance process, it will also increase the volume of collective decisions that can be made by the network at any given time, dramatically improving the agility and adaptability of Polkadot’s upgrade path and ensuring a future of continual innovation.
Another impactful upgrade will be asynchronous backing, an optimization to parachain consensus with the potential to allow Polkadot to process upwards of 1 million transactions per second, which would represent a new peak of throughput for the industry.
XCMv3, an important upgrade to Polkadot’s interoperability standard, will unlock trustless cross-ecosystem bridging with XCM, as well as NFT transfers and remote locking. Once XCMv3 is live, Polkadot will be able to launch trustless bridges for interoperability with other ecosystems, including planned bridges to Kusama and Ethereum via a Bridge Hub parachain.
The launch of parathreads and additional scheduling methods will allow blockchains to launch on Polkadot while bypassing the auction process, significantly improving the ease and flexibility of deployment options for Polkadot’s next generation of blockchains. This will bring Polkadot closer to the goal of being the strongest marketplace of flexible, high-quality blockspace as outlined by Rob Habermeier in his 2022 post Polkadot: Blockspace over Blockchains.
We’ll also see continued maturity of Polkadot’s Wasm smart contracts ecosystem, representing a more efficient, powerful and robust alternative to Ethereum (EVM) smart contract technology.
The outlook for the broader Polkadot ecosystem in 2023 is also incredibly strong, with a packed pipeline of projects set to launch their custom parachains in the coming months across a wide range of use cases, bringing a new wave of users to Polkadot. Given that the average parachain on Polkadot has only been live for about 6 months, we’ll also see these existing projects coming into maturity in 2023. In many ways, as busy as parachain and dapp development has been in 2022, teams have largely been busy rolling out their core functionality, so things are really just getting started for the Polkadot ecosystem — 2023 is sure to be an exciting year for the community.
While this is certainly not all that happened in 2022 nor close to what’s coming for 2023, the time has come to wrap up the 2022 Roundup until next year. Happy New Year to everyone reading and to Web3 builders, keep on building!
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