PDEX Token Journey: From ERC-20 to Substrate
Why we launched PDEX as an ERC-20 token and what will happen to ERC-20 PDEX tokens once we launch Polkadex Mainnet
As a next-generation, heterogeneous multi-chain network, Polkadot is often hailed as the ‘next big thing’ in the world of decentralized technology and finance. However, many of the projects building on Polkadot network have often faced scrutiny over whether they truly belong to the Polkadot ecosystem or are just trying to take advantage of the Polkadot brand. Many projects were accused of not being true Polkadot projects solely because they did not launch a token or product natively on Polkadot from the start. However, at Polkadex we have no doubt of our belonging to the Web3 and Polkadot ecosystems. We are building on Substrate, the backbone that powers Polkadot and other chains in its ecosystem, and we received a grant from the Web3 Foundation that bootstrapped our project initially.
When we set out to build Polkadex, we didn’t intend on launching a token until the Polkadex Mainnet was live. We sought to gain institutional investment first and closed seed, strategic, and private fundraising rounds before the token launch. This allowed us to focus on building the revolutionary product that Polkadex will become.
However, on our journey towards releasing the Polkadex Mainnet, we decided to launch our token, PDEX, as an ERC-20 token on Ethereum network. While this has opened Polkadex up to criticism from a handful of community members, it also has helped grow the Polkadex community and cemented a secure future for the network as a whole.
Why launch PDEX token before the Mainnet?
In the midst of building Polkadex, we realised that there were undeniable benefits to launching a token prior to the Mainnet release.
⚫️ One of the major benefits of launching the token early in the project’s life is that it helps Polkadex widen the distribution and create a bigger, more solid community. Current token holders are potential users, so come Mainnet, the wider distribution would increase the number of interested parties participating in the chain and bring together more consensus and security to the network. A larger community of token holders also enhances Polkadex’s chances to win a parachain auction.
⚫️ Launching a token prior to the Mainnet was also a form of giving back to our early supporters and securing the strength of our network of backers. Token gives investors the opportunity to stay liquid, which in turn means that any weak hands in the system are eliminated at the project’s infancy. As a consequence, Polkadex weathers the storm even during uncertain times on the market and adds extra security to the network at the time of the Mainnet launch.
After going through many rounds of due diligence from our institutional investment phases, we took the benefits of launching a token for the project & community into account and decided to move forwards with the public offering. Once we went ahead with the idea of launching PDEX as an ERC-20 token on the Ethereum network, we also conducted both an IDO on Polkastarter and an IEO on Kucoin in April 2021.
Polkadot DeFi Alliance talk
Last week our Executive Director, Vivek Prasannan, was invited to the talk hosted by our partner organization, Polkadot DeFi Alliance, to discuss different options of bootstrapping projects in the Polkadot ecosystem and share Polkadex’s personal story.
PDEX migration to native Polkadex network
Despite PDEX being initially launched on the Ethereum network, our plan has always been to have PDEX on its native Polkadex network since PDEX is an integral part of the Polkadex ecosystem. Therefore, the first action in the series of Mainnet events will be to migrate all the PDEX tokens from their ERC-20 state to Polkadex, turning them into native, Substrate-based tokens through a one-way bridge. We’re working on making this process as seamless as possible for PDEX holders and have already completed the code for it. The token migration code, along with most of the Polkadex Orderbook code, will be audited by trusted third parties later this month.
As always we will announce all the news and changes in advance, giving all the holders more than enough time to transfer and providing detailed explanations for the process.
Migration details & support
An additional benefit of the planned PDEX migration is that it will serve as a testament to how easily other currencies can move between chains in the Polkadex ecosystem. We also designed the one-way migration with user experience in mind, as the process will be as simple as possible. We kept the bridge for PDEX one-way only as we want to keep PDEX inside the native network.
Overall, while there is no set playbook to launching a product on Polkadot, Polkadex is taking the necessary steps to foster a healthy and supportive community come Mainnet, which will translate into an even more secure and distributed network.