This is blockchain unbounded.
Parachains are advanced, next-generation layer-1 blockchains that transcend the limitations of legacy networks. Specialized and interconnected, parachains make up a diverse ecosystem of independent platforms, communities, and economies improving the way we connect online.
Parachains = Possibilities
While other blockchain protocols only allow developers to build dapps using smart contracts, Polkadot gives them full control over the underlying blockchain itself. This flexibility gives parachain developers the maximum freedom to optimize for any use case—which means better and more secure dapps and services for all.
A single, limiting design for the entire network. No ability to optimize for specific use cases, so compromises and tradeoffs must be made.
Parachains are specialized for a multitude of use cases, enabling more optimized services and thriving, multifaceted economies.
Most blockchains are like walled gardens, cut off from each other and unable to communicate, prohibiting the free flow of data and commerce.
Parachains are a rich, interconnected ecosystem where data flows freely between chains, leading to innovative new interoperable services.
Transactions are processed one-by-one, leading to bottlenecks, network congestion and high fees when dapp usage spikes.
Prachains process transactions “in parallel”, spreading them across the entire multichain network for maximum scalability.
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.
Seamless on-chain upgrades
Polkadot makes upgrading a blockchain more like upgrading a conventional app, with the ability to make most updates seamlessly and automatically in the background.
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 can leverage on-chain treasuries, giving decentralized communities the financial agency once limited to corporations and governments.
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.
Built-in, customizable governance
Parachains can leverage Polkadot’s built-in, transparent governance features or create their own to implement the system that’s best for their community.
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 get robust security automatically when they connect to Polkadot—no need to bootstrap their own network of miners or validators.
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.
Streamlined development with Substrate
Parachains can use the Substrate blockchain framework to drastically simplify and speed up development and maintenance.
High, unpredictable transaction fees
Fees on blockchains are often unpredictable, fluctuating based on short-term network usage and congestion.
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.
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.
Any type of data
Polkadot allows any type of data to be sent across 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:
Independent token economies
Parachains with their own tokens, fee structures, and economic ecosystems.
Common good parachains
After the lease, the full amount of DOT is unlocked, meaning auctions do not require teams to “spend” DOT. The cost of the lease is best characterized as the opportunity cost of not being able to use the bonded DOT for other activities.
Bridges allow Polkadot parachains to connect to external networks like Kusama, Bitcoin and Ethereum.
Parachains that provide a range of functionality to serve a broader community or use case, for example DeFi hubs and governance hubs.
Smart contract parachains
Platforms for building and hosting smart contract based dapps and services, with support for Wasm-VM and/or EVM.
Pay-as-you-go parachains for early stage networks and those that don’t need continuous connectivity to Polkadot.
Parachains as autonomous agents
Parachains can act autonomously based on the will of their communities to participate in Polkadot 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.
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. Polkadot allows them to come together, communicate and share security guarantees for the betterment of the entire ecosystem. A free alliance of sovereign chains.
Auctions & Crowdloans
Parachains connect to Polkadot by leasing an open slot on the Relay Chain via auction, which involves locking up a bond of DOT for the duration of the lease. DOT holders can help their favorite parachains win an auction, potentially earning a reward in return, by contributing to a crowdloan and temporarily locking their own DOT for the parachain’s bond.