Bifrost wins final parachain slot on Polkadot testnet Kusama
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The fifth parachain auction on the Kusama network has now been won by liquidity-providing DeFi project Bifrost.
A total of 142,431 KSM (worth about US$21.16 million at the time of the auction win) was raised as the winning bid, with Bifrost thanking more than 5,200 contributors.
Parachains are bespoke, project-specific layer 1 blockchains that integrate directly within the Kusama and Polkadot networks. This was the last parachain auction to take place on the Polkadot testnet Kusama and there are currently only 100 parachains planned for Polkadot in total.
Given the scarcity, competition for the parachain slots has been fierce.
Bifrost will now be connected to and secured by Kusama’s central Relay Chain, giving it the benefits of sharing in the security, stability, interoperability and governance that Kusama, and more indirectly Polkadot, provides.
— Bifrost (@bifrost_finance) July 20, 2021
Bifrost (BNC) is aiming to be a powerful enabler of “liquid staking” within the Kusama ecosystem. The idea is to allow users of Proof of Stake (PoS) tokens to keep their funds available to participate in Kusama-based DeFi activities.
This means users staking PoS cryptocurrencies that are currently locked up on individual networks will be able to stake them on Bifrost instead, swapping them for vTokens (eg. vETH, vDOT).
These vTokens will then allow anyone to participate in DeFi activities on Kusama, such as lending and borrowing, without having to give up more than a small fraction of their staking rewards.
It’s a nice flexibility play that aims to give crypto holders the power to do even more with their rewards-earning assets. Not that earning 5% APR (or in some cases much, much more) simply through staking isn’t already a good thing.
Bifrost joins DeFi project Karura, Ethereum compatibility project Moonriver, dApp hub Shiden, and privacy project Khala on the Kusama parachain winners list.