Polkadex is Swapping Parachain Slots
Polkadex will extend it’s parachain lease via a slot swap with an existing, unused Polkadot parachain
Polkadex has signed an agreement with an existing Polkadot parachain team to acquire the rest of their parachain slot and perform a slot swap. This will ensure the Polkadex parachain continues running beyond its current April 10th lease expiration date. The slot swap will preserve the connection between Polkadex and the wider Polkadot ecosystem, allowing the trustless flow of liquidity to and from Polkadex Orderbook to continue.
Polkadex’s Two-Chain Model
Before getting into specifics, it’s important to know that Polkadex is composed of two networks: the Polkadex Main Network and the Polkadex Parachain.
Polkadex Orderbook and THEA run on the Polkadex Main Network, a substrate solo-chain secured by 200 active validators, and nearly 3k stakers with 6.2 million PDEX staked.
The Polkadex Parachain is used as a way to connect the Main Network to Polkadot — making it possible to trustlessly bring assets from other parachains to Polkadex and back via Polkadot’s XCM. In other words, the Polkadex Parachain enables the bridging of Polkadot ecosystem tokens to Polkadex for them to be listed and traded on Polkadex Orderbook.
Crowdloan 2.0: A new Parachain auction bid
Since the current Polkadex parachain lease expires on April 10th, Polkadex, in an attempt to prevent any disconnection between the two networks, decided to renew its parachain lease by launching a bid to secure a slot in the parachain auctions taking place before April 9th.
When we launched our bid to renew the Polkadex parachain slot we were seeing parachain auction slot wins trending down with plenty of parachains renewing their slots in recent auctions with around 30,000 DOT contributed (mostly self-funded). This, combined with the context of Polkadot 2.0’s upcoming agile coretime, seemed to confirm the parachain auction model was on its way out.
Our approach at Polkadex was to invite the Polkadex community to participate, starting with a seemingly higher-than-necessary 50,000 DOT rewards cap to be safe. However, in the face of relentless competition with high bids from new entrants to the Polkadot space, and anonymous and/or self-funded players, we were shut out from the competition. Therefore, despite the Polkadex Crowdloan attracting nearly 54,000 DOT in total contributions from over 385 contributors — the highest-ever number of contributions for a slot renewal bid — we were unable to secure a renewal via the auction route.
Slot Swap
Once it became clear that Polkadex’s renewal bid might face tougher competition than initially anticipated, the Polkadex Core Contributors shifted gears and worked behind the scenes to find parachains with unused slots that could be swapped over to Polkadex, thereby extending the Polkadex Parachain’s lease without the need for an auction win. This work behind the scenes explains why you have not heard from Polkadex’s Core Contributors as much as usual during the latest parachain auctions.
The good news is that an agreement has now been signed with a parachain team to acquire their remaining parachain slot until Q4 2024! This slot swap will extend Polkadex’s support for Polkadot tokens and parachain connections until Q4, at which point Polkadot 2.0 should be live.
The slot swap has not been executed yet and is scheduled for April 9th. While the actual swap process is fairly simple and can be called at any moment, the complexity within the two existing slots and the fact that this is only the second time a slot swap will be executed on Polkadot requires a cautious approach.
Potential Risk
While the most likely outcome is that the slots are swapped seamlessly and the Polkadex parachain continues to be connected to Polkadot and other parachains via XCM until Q4, there is a small chance that, since this specific case is an untested workflow in Polkadot, the swap could cause issues with the Polkadex parachain. Potential downtime on the Polkadex parachain could result in a connection break between the Polkadex Main Network and the rest of Polkadot, with a temporary suspension in XCM transactions until a resolution is found and applied — potentially with the help of OpenGov.
In an effort to maximize transparency and exercise an abundance of caution, we would like to give a fair warning of any issues that might arise and allow ample time for users to transfer funds from Polkadex back to their networks of origin before the swap is executed on April 9th, if they choose to do so.
It is important to note that if an issue does arise during the swap process, it would only affect the Polkadex Parachain. It would have no impact on the Polkadex Main Network.
No matter what, trading on Polkadex Orderbook will remain unaffected and you will still be in full control of your funds on the Polkadex Main Network. The only result of a temporary interruption to the Parachain connection is that your funds could remain on the Polkadex Main Network until the connection is reestablished.
Therefore, if you aim to use your DOT, ASTR, GLMR, IBTC, PHA, USDT, PINK, or DED on Polkadot, Asset Hub, or other parachains in the next few weeks, you should use Polkadex’s THEA Bridge to transfer them back from Polkadex to your desired network before April 9th. You can always transfer them back to Polkadex for trading on Orderbook once the parachain slot swap is successful.
If you’re happy with waiting until the potentially suspended connection is re-established, you don’t have to do anything at this time and can continue to use your funds for trading on Polkadex Orderbook.
Regaining Focus
The parachain slot renewal has understandably taken up a large part of the Polkadex Core Contributor’s efforts as well as the Polkadex community’s focus in the past few months. All the while, the number of registered Orderbook users has increased by 50%, and the number of PDEX holders has increased by 700 in just 3 months. Driven by the completely revamped UI, the introduction of trading fees, auto-swap and PolkaPool, momentum is gathering around the CEXier DEX.
The slot swap solution will allow Polkadex to continue to focus on improving the Orderbook experience in order to seamlessly welcome traders from the Polkadot ecosystem and beyond — with an Ethereum connection pending audit, EVM wallet and ERC-20 token listing support around the corner, and the liquidity mining program waiting for funds to further incentivize liquidity.
Thank You!
Thank you to the Polkadex community for their patience and understanding throughout this parachain slot renewal effort, and a special thanks to all those who have contributed to the second Polkadex Crowdloan! While Polkadex may not have won a slot renewal from the auctions, the purely organic crowdloan performance has shown the strength of the Polkadex community within Polkadot — a force to be reckoned with which will further prove its worth in any potential Polkadex proposal to OpenGov.
The Polkadex Core Contributors look forward to connecting with the Polkadex community in an overdue AMA session to take place in the week after the slot swap process is finalized and THEA is transferring assets using the new slot.
