Dot Pulse #18 — Polkadot Gets Ready to Roll & Altair Deep dive
Learn about the Altair parachain, Polkadot parachain auctions, the five entry parachains rundown, and governance watcher! 📣
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We’re now at Slot 9 of the Kusama parachain auctions, almost through the first two batches! This time we take a look at Altair, the canary network of Centrifuge.
Centrifuge is very interesting because it focuses on Real World DeFi. They’re the provider used by Maker to create their RWA vaults, so it’s definitely a good example of a multi-chain project that is based on Substrate and DotSama. Let’s see how it all works!
Altair: The Pre-Centrifuge
The core value proposition of the Centrifuge ecosystem is Tinlake, a lending platform for real world assets. It connects real world businesses looking to get a loan with DeFi users who want to earn some yield on their crypto. Pretty straightforward, no?
Underneath it’s a rather complex system both from a legal and technical perspective, so let’s unpack how it works!
The Tinlake Asset Originators
The Centrifuge system relies on businesses looking for liquidity, called asset originators. These will take some real world form of collateral — which can be an invoice, mortgage, bond, or royalty contract — and then tokenize the documents as NFTs. The NFTs are put into a Tinlake pool that counts them as collateral to borrow DAI on the other side of the pool.
There are quite a few vaults on Tinlake right now, so let’s check out what kinds of deals you can get!
1754 Factory is a company that manages short-term cash advances for the users of Bling, an app offering micro-loans for primarily French consumers. So Tinlake lets you finance these deals for a minimum of 8% APY, plus the 25% CFG bonus.
Branch is similar to Bling, but centered around Kenya, Mexico, Tanzania and other developing countries.
Next we have Harbor Trade Credit, which is a supply chain finance company that helps suppliers and clients to meet their liquidity needs. For example, suppliers can issue invoices and use them as collateral for loans, getting the liquidity faster.
Another interesting vault is New Silver, which is a company that finances real estate entrepreneurs in the “fix and flip” business. It’ll provide loans to both buy and refurbish a home, allowing businesses to operate with much more flexibility. This one offers a 4% base APY.
There are many more vaults but the common theme is the same: niche lending and fintech companies that probably have a hard time getting liquidity from banks due to how specialized their business is (or whatever reason, banks can be quite arbitrary in general!).
You know how in the early days of DeFi people talked about banking the unbanked and helping the real world with crypto finance? Well, most of DeFi is actually focused on trading. But Centrifuge isn’t! It’s an actual real world product offering utility to companies who can’t get served by banks.
Of course you’ll also need to temper your expectations. There are no Pool2s and degen farms here, the yield comes from businesses actually paying it. And in the real world, 8% is a lot! To put it in perspective, you’d end up paying about 240% extra for your house if you took a 30 year mortgage at these rates.
But why Altair?
Tinlake is Centrifuge’s main product, and it has existed on Ethereum for a while now. But the use cases envisioned by Centrifuge require extremely fast throughput and cheap fees, as well as privacy. While Ethereum is a good start, the team has decided to create the specialized Centrifuge Chain to optimize the uses it needs.
For the longest time, Centrifuge was a standalone blockchain based on Substrate. With the parachain auctions live, the team decided to spin up Altair ahead of the main Polkadot parachain slot that will turn the main Centrifuge Chain into a parachain as well.
Altair is designed to be the wilder and more experimental brother of Centrifuge. It will get new updates faster and support more experimental use cases, like using tradable NFTs (like CryptoPunks or BAYC) as collateral for Tinlake!
The Altair Crowdloan
Altair raised 187k KSM in its crowdloan and distributed 400 AIR for each KSM, which is about 15% of the AIR supply. But almost half of the total went to CFG holders through a snapshot.
Unfortunately AIR isn’t tradable yet so we can’t estimate returns for this one either, so stay tuned!
And the first Polkadot parachain batch is done! Clover took the fifth and final Polkadot parachain slot.
Crowdloans for the next batch are already live, so you can already start supporting your favorite parachain. But keep in mind that these ones will go live in March, so the waiting period may be a bit longer here.
On Kusama, Zeitgeist won last week’s slot. Sakura, the Kusama parachain for Clover, is leading this batch.
Active Crowdloans (Polkadot)
TL;DR: Offering 15% of the supply to launch the main Polkadot version of Calamari. You’ll get extra rewards from the MantaPay liquidity bootstrap, and a bonus if you contribute from Binance.
TL;DR: An NFT parachain created by Enjin, offers 10% of the supply. You get fancy NFTs for being one of the top contributors!
TL;DR: Starting out fast with a 12% supply offering. The platform aims to be an “everything VM” to hold every possible smart contract architecture on one chain. The nice thing is that you can also contribute with stablecoins to this one!
TL;DR: Offering 15% of supply to connect Centrifuge Chain to Polkadot. Offers a whole bunch of early bird, referral and double dip bonuses!
TL;DR: The platform offers 10% of supply to bring trustless Bitcoin to Polkadot. Plenty of referral bonuses, double dips and early bird bonuses too!
Active Farms
Earn KAR by staking on Karura DEX
Yields are around 20% APR (or 45% with loyalty bonus) for KAR/KSM.
KSM/LKSM farm has 15% APR (45% with loyalty)
KAR/kUSD offers an APR of 65%, 95% with loyalty.
Earn KAR + BNC (Bifrost tokens) when staking kUSD/BNC
APR is 120% with loyalty, 35% without.
Sushi farms on Moonriver have recovered a bit, but struggle to stay above 100% APR.
Solarbeam farms are strong with plenty of >100% APR choices for brave degens.
RomeDAO is giving a solid 10% return every 5 days for OHM-style staking.
After this week we finally know our 5 parachains to open the Polkadot season! We have Acala, Moonbeam, Astar, Parallel and Clover.
And all 5 can be DeFi parachains!
We’ve written about the canary deployments for the first three, which were Karura, Moonriver and Shiden. There aren’t many differences between them and their younger but beefier brothers, so they should give you a good idea of what to expect!
Parallel and Clover are relatively new entries! Parallel exists on Kusama as Heiko (and it’s next on our list of deep dives by order of inclusion). Clover never quite managed to get a Kusama slot until now, but it hit back hard on Polkadot. It’s a smart contract parachain targeted for DeFi, much like the others on this list.
It will definitely be interesting to see how the lack of Kusama experience will set apart Clover from all the others. We can expect most parachains to be fully operational between January and February, although you never know what might happen!
And what could be better to celebrate this achievement than a new logo?
This week, that cute little blob replaced the basic “P” that we all came to appreciate. It was a nice P for sure, but it definitely makes sense to have a more abstract logo for such a project!
So while we had our fun with Kusama and its early deployments, Polkadot is what most people know and feel compelled to join. Once it launches the parachains next week on December 23, the Polkadot ecosystem will finally be ready to join the ranks of popular destinations like Solana and Avalanche.
But it’s important to remember that here we have a whole 5 chains, which can be both a blessing and a curse. Acala and Parallel are likely to be the more “sober” alternatives as they focus on doing DeFi “in-house”. Moonbeam, Shiden and Clover may get crazier, it all depends on the devs!
🎄 PSA: We’ll be skipping the next edition for the holidays, but we’ll come back on New Year’s to close this amazing year for Polkadot! 🎄
After winning the first parachain slot auction on Polkadot, the Acala team can now start the launch of their network by enabling ACA transfers, lcDOT, EVM+ and more.
Manta has launched a testnet called Dolphin, which will include three main components for users to try: the Dolphin Signer to privatize transactions, the Faucet for obtaining testnet tokens and the testnet app.
One of the most popular development environments for smart contracts on Ethereum, has created a plugin for Moonbeam, which will allow Solidity devs to quickly deploy on it.
(Polkadot) Referendum 46 to upgrade Shell to Statemint, enabling generic tokens on Polkadot.
(Polkadot) Referendum 45 to upgrade Polkadot Runtime to v9140.
(Polkadot) Motion 133 a proposal for Polkadot to join the Messari Hub, a community-driven marketplace for independent research written by qualified contributing analysts and funded by crypto organizations.
(Polkadot) Motion 132 a proposal to cover maintenance costs for all related Polkadot projects for the year 2021.
All info in this newsletter is purely educational and should only be used to inform your own research. We're not offering investment advice, endorsement of any project or approach, or promise of any outcome. This is prepared using public information and couldn't possibly account for anyone's specific goals or financial situation. Be careful and keep up the honest work!
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