Yesterday TopDao had their first interview with Bifrost, the parachain that’s currently participating in the Kusama slot auction, here is a brief recap of the Q&A:
Carter: Welcome to the TopDao community, Tyrone! Could you please tell us a little about yourself?
Tyrone: Greetings guys! Nice to see you guys here. I’m Bifrost Product Manager Tyrone, graduated from the University of Glasgow with a master’s degree in economics, Dissertation has conducted in-depth research on the new financial model of blockchain and participated in the public course of blockchain technology and application by Professor Xiao Zhen of Peking University. Today we’ll let you learn about how to maximize your BNC reward in parachain bonding.
Carter: Welcome again! Tyrone. So, first of all, what is BIFROST?
Tyrone: Bifrost is the Polkadot Ecological Defi basic protocol. It is committed to becoming an infrastructure for pledged assets to provide liquidity. It has launched a derivative vToken for Staking and Polkadot Parachain Slot Auction (SALP). It has obtained $2.15M in fund-raising from NGC, SNZ, DFG, CMS and other institutions and Web3 Foundation Grant. It is also a member of the Substrate Builders Program and Web3 Bootcamp. We’re currently making our parachain auction on Kusama.
Carter: I see a very strong background with cutting-edge ideas. We just learned that Bifrost is currently participating in the Kusama slot auction. Can you talk to us about why you want a Parachain slot?
Tyrone: An important reason why Bifrost chose Polkadot’s ecosystem is that it doesn’t need to maintain a set of consensus by ourselves. This is also an obvious advantage of being a parachain to connect with relay-chain, which enjoys the parachain shared security provided by all parachains.
Maintaining a set of consensus security requires a lot of investment in capital and labor costs; It doesn’t make sense for a creative organization to quickly produce a killer application. So, after we accumulated development experiences and researched about single-chain and multi-chain framework, we finally decided to develop Bifrost by Substrate, and becoming a parachain will enable us to accumulate the liquidity from different PoS chains to Polkadot layer-one, with shared security, but not only a smart contract.
At the same time, Bifrost can use smart contracts to deploy services on heterogeneous PoS chains outside Polkadot. For example, our Ethereum derivative vETH will become an ERC-20 and Substrate base dual-asset after Bifrost mainnet on parachain is launched, and it will take much external value to the Polkadot ecosystem beyond building bridges.
Carter: Alright, so users participating in the Kusama slot auction will face a lock-up period up to 48 weeks. How does Bifrost unlock the staking liquidity during this period?
Tyrone: Yes, we have completed the development of a solution that allows users to release liquidity during the bidding bonding period: slot auction liquidity protocol, which we call SALP, you can check the Bifrost Kusama crowdloan with SALP at: https://ksm.vtoken.io/
SALP is Bifrost’s original creation. Our original intention by studying slot auction derivatives is to help users unlock the liquidity of the 6–48 week KSM bonding during slot auction. At the same time, considering the uneven auction redemption period and other factors that may affect the liquidity of derivatives, Therefore, we create derivatives vsToken and vsBond, which represent asset utility and equity attributes.
Users can buy and sell vsToken at any time to enjoy liquidity, and hold vsBond to receive auction rewards issued by the parachain. This is something that other slot liquidity projects cannot do. As a financial product, derivatives with non-uniform liquidity will have a great impact on the user experience.
Here is an example: Vote 1 ksm to Bifrost, you’ll get 1vsKSM+1vsBond-Bifrost, so you can trade both of them during the Bifrost parachain lease period. Maybe you want to sell 1 vsKSM for 0.98 KSM (0.02 is the discount in the liquidity trading pool), or you can wait until Bifrost parachain retires, destroying 1vsKSM+1vsBond to redeem 1 KSM without cost. Holding vsBond-Bifrost can receive BNC rewards automatically, or you can sell it on the Bifrost vsBond market.
Carter: Why design vsToken as a fungible token? What are the problems with issuing different derivatives for different parachains?
Tyrone: The lower the degree of homogeneity, the worse the liquidity. Issuing different derivatives for different parachains will result in a situation where each derivative needs to provide liquidity separately.
Non-fungible factors such as different parachain lease periods, different redemption periods, and inconsistent parachain reward strategies have led to the inability to achieve complete fungibleness of derivatives, and non-fungible is an obstacle to liquidity. In contrast, fungible derivatives will put liquidity together from different parachain crowdloans, forming an objective liquidity advantage. Therefore, Bifrost starts with the Token attributes in crowdloan, decouples its attributes to utility and equity, and designs two derivatives: vsToken (Voucher Slot Token) and vsBond (Voucher Slot Bond).
Carter: So, there are many Canary networks competing for the first few kusama slots, what is Bifrost’s bidding advantage in it?
Tyrone: 1. Mainnet bidding advantage: Bifrost, as the basic protocol for the DeFi derivative assets of Polkadot, will not issue a Canary network and run two sets of business logic because doing so will cause the community to split and dilute the liquidity of derivatives. Therefore, the parachain strategy adopted by Bifrost is to run only one mainnet. When the Kusama slot expires, the data will be snapshotted to Polkadot’s genesis block to complete the migration of the mainnet from Kusama => Polkadot, and so our derivative (vToken) usage scenarios have been fully upgraded. Due to the strong binding relationship between the value of BNC and the liquidity of vToken, under the impetus of a complete economic model, the value of BNC will steadily advance with the business development of the main network.
2. Release KSM lock-up liquidity: Bifrost’s unique slot auction liquidity protocol SALP will support Bifrost slot auction for the first time in Kusama auctions. All KSM pledged through ksm.vtoken.io will receive liquidity derivatives vsKSM+vsBond. The former is used to release liquidity, and the latter is used to receive parachain rewards.
3. SALP derivatives are rich in usage scenarios: firstly, vsKSM as the basic function of the derivative token will create the liquidity release of vsKSM/KSM, and secondly, vsBond as a semi-homogeneous token will give birth to a parachain-like NFT trading market for reward certificates. In addition to being used to redeem the native KSM, vsKSM+vsBond’s innovative economy mode will be able to obtain rewards from Bifrost and other parachains in the form of pledge mining.The 50% reward will be released immediately and the transfer will be initiated: Bifrost will initiate the Token Generation Election proposal after the parachain is launched. Once the proposal is passed, all mainnet BNC vouchers will be converted to native tokens and activate transfer.
Carter: Can you point the way, how can our community members participate in the auction?
Tyrone: 1. Bifrost official participation channel: vsKSM Mint Drop
The vsKSM Mint Drop participation page integrates Bifrost’s original parachain bonding liquidity protocol SALP. Participate in voting to obtain vsKSM and vsBond derivatives, which can be used to unlock liquidity during the bonding period.
For details, please see: vsKSM Mint Drop is coming
This channel has opened whitelist priority voting at 21:00 UTC+8 on June 10, 2021 (addresses that have been reserved can participate), and started formal voting (any address can participate) at 21:00 UTC+8 on June 11, 2021.Participating address: https://ksm.vtoken.io/
Check the minting tutorial here: https://www.youtube.com/watch?v=O1CTi9G2S60
2. Kusama official parachain Crowdloan
Bifrost will create Bifrost-Kusama-Crowdloan before 2021–6–15, and users can participate directly through the Kusama relay chain.
Participating address: https://polkadot.js.org/apps/#/parachains/crowdloan
3. Multi-participation channels
Bifrost has already reached Crowdloan support channel cooperation with many project parties, wallets and decentralized exchanges.
Project party: Bifrost reached a cooperation with Zenlink/Nutbox’s Crowdloan product and will support Bifrost SALP in the parachain crowdloan.
Decentralized wallet: Bifrost cooperated with Fareless Wallet, Math Wallet, etc. to support Bifrost parachain auctions on the mobile side.
Centralized exchange: Kraken / OKex / Kucoin / MXC / Gate will support Bifrost Parachain Crowdloan.
vsKSM Mint Drop has aggregated all participating channels: https://ksm.vtoken.io/
That’s the end of our Recap, the Bifrost project is still in the Kusama auction, so go support them while you could! The interview had on average 450 people online, 46 good questions were asked, and our Twitter was interacted with over 2000 times! Join our fun community for more AMA and non-stop airdrops!