Parachains are specialized blockchains connected to a Relay Chain on platforms like Polkadot or Kusama. They are very flexible and easy to customize, allowing developers to build their own blockchain networks customized for specific use cases. One parachain worthy of note is Moonbeam, the first fully operational parachain on Polkadot.

What is Moonbeam?

Source: moonbeam

Moonbeam is an interoperability-focused blockchain platform hosted on the Polkadot network. It is designed to work seamlessly with Ethereum, so developers can deploy Solidity smart contracts and dApp frontends on Moonbeam without making many changes to their source code. This is made possible via its EVM implementation and web3-compatible API.

As a parachain on Polkadot, Moonbeam facilitates the seamless integration of Ethereum-based dApps and DeFi projects. Additionally, Moonbeam also provides abstraction features for users, allowing them to swap and trade assets across any blockchain. As such, they don’t have to worry about the technicalities of blockchain use. These features significantly improve the project’s scalability, interoperability and on-chain governance.

History of Moonbeam

Moonbeam was introduced to the public in January 2020 by Derek Yoo, the CEO of Purestake. This development outfit also built developer tools for platforms like Algorand, and runs Polkadot validators.

However, the project didn’t gain momentum until July of the same year when the project won a grant from the web3 foundation. Following this grant, Moonbeam launched its testnet in September 2020 and secured a Polkadot parachain slot in November 2021.

More than 200,000 Moonbeam users delegated nearly a billion dollars’ worth of DOT tokens to help Moonbeam secure a parachain slot. On January 11th, 2022, Moonbeam officially launched on Polkadot as the first fully operational parachain on the platform.

Moonbeam also received lots of support from the crypto community, as the project raised up to $31.95 million in funding across three rounds. The project raised $1.40 million in its seed round, $6 million in its strategic round, and $24.55 million in its Initial Coin Offering (ICO). Investors include the likes of Hashkey Capital, Coinbase, Binance Labs, ParaFi Capital, Fenbushi Capital, Hypersphere Ventures, Arrington XRP, amongst others.

How Does Moonbeam Work?

Polkadot operates as a multichain network promoting interoperability among more than 100 parachains through the Relay Chain. The Relay Chain is the core of Polkadot, and it provides shared security and network consensus for parachains. This setup ensures continued interoperability for all connected parachains and offers more secure and efficient smart contract usage compared to other sidechains.

Additionally, Moonbeam operates alongside its sister chain, Moonriver, which operates on the Kusama network. Moonriver exists as a test environment for new features and dApps looking to integrate with Moonbeam before their official launch.

Moonbeam was built using the Rust programming language and the Substrate framework. Rust is a high-performance programming language with built-in memory safety features enforced during compilation. This helps prevent many common bugs and security issues arising from C and C++ programming language implementations.

With Moonbeam, developers can implement smart contracts using Solidity, Vyper, and other languages that compile smart contracts into EVM-compatible bytecode. Moonbeam also offers developers libraries such as Etherjs, JavaScript, and Web3, along with access to Ethereum tools like Waffle, Truffle, Metamask, and Remix.

Moonbeam also operates a fully decentralized Delegated Proof-of-Stake (DPoS) network, which allows users to delegate collator candidates that produce blocks and earn rewards. It leverages the Nimbus framework for parachain consensus, and the number of candidates in the active set will be subject to governance. The active set will consist of the top candidates by stake.

This architectural framework enables the project to run smoothly, attaining an average block time of six seconds and achieving transaction finality of 30 seconds with an average amount of 700 transactions per block.

Main Features of Moonbeam

Substrate Compatibility

Substrate uses a modular infrastructure of reusable components called pallets to help developers easily build and customize blockchains. It was built in the Rust programming language, and serves as the foundation for building parachains on the Polkadot network.

Moonbeam is fully interoperable with Substrate, meaning that dApps built with Moonbeam can also enjoy cross-chain compatibility with other dApps across the Polkadot and Ethereum blockchains. Substrate also provides a familiar development ecosystem for developers, including tools like block explorers, front-end libraries, and wallets, making it easier for them to transition to the Moonbeam ecosystem.

Cross-Chain Integrations

Moonbeam has partnered with several cross-chain bridges, including cBridge and Multichain Swap Protocol. These bridges facilitate the seamless transfer of assets between Moonbeam and other blockchain networks, thus helping Moonbeam scale its accessibility. As more bridges join Moonbeam’s ecosystem, the platform’s compatibility with other blockchains will grow, offering users a wider range of options for interacting with dApps.

Web3 API

Moonbeam’s API offers developers broad access to Web3 networks while simplifying the process of redeploying Solidity smart contracts and Ethereum-based DApps. As such, it’s an easier option for developers trying to transition their existing Ethereum applications onto the Moonbeam platform.

Staking

Moonbeam employs a group of selected collators with a stake in the network, and tasks them with gathering transactions and creating new blocks. They also create the receipts for the validators on the Relay Chain.

Currently, there are only 76 collators in the active pool, and 50% of the annual inflation is distributed to the active collators as rewards.

Since the project runs a DPoS consensus mechanism, Moonbeam also incentivizes delegators (GLMR holders) to stake a minimum of 50 GLMR to vouch for collators. However, only the top 300 delegators (determined by the amount of GLMR staked) of each collator are eligible to receive staking rewards.

Co-Marketing Support

Moonbeam recognizes that teamwork is essential to building a thriving blockchain ecosystem. As such, the project offers a co-marketing program that provides valuable support to builders integrating Moonbeam into their projects.

For developers, Moonbeam’s support will help provide visibility for their projects. They will also be able to tap into Moonbeam’s user base and marketing resources, allowing the project attract even more potential users. Moonbeam will also leverage its large network of community campaigns and events to spread the word about the project.

Moonbeam’s Use Cases

Moonbeam’s innovative approach allows it to serve several use cases, including:

Web3 and Gaming

Moonbeam facilitates seamless asset transfers and multi-chain interactions to enhance the gaming experience. As such, it empowers creators and players with true ownership and interoperability of their assets. Players can also influence the growth of their in-game ecosystems via decentralized governance.

Support for Real-World Assets (RWAs) On-Chain

Moonbeam simplifies real-world asset tokenization, which in turn enhances accessibility and market fluidity. It also supports improved integration of DeFi solutions that brings real-world utility into blockchain.

Multi-Chain Integration for dApps

Moonbeam is a go-to developer choice because of its large user base, high interoperability, and access to different blockchains and ecosystems. This approach provides extra security for dApps, and allows developers to use the best features from different blockchains to improve their dApp’s performance.

Moonbeam’s multi-chain approach also allows it to tap from deeper liquidity pools while reducing user and liquidity fragmentation, making transactions more efficient and cost-effective.

Moonbeam Ecosystem

Moonriver

Source: moonbeam

Moonriver was launched in August 2021 as a parachain on the Kusama network. It operates as a sister network to Moonbeam, serving as a testing environment for new code under real economic conditions. As such, developers can experiment with new features and products for Moonbeam on a canary network.

Moonriver operates with an active set of 72 collators. It also provides a robust infrastructure that offers API endpoints for easier network connection. It also allows independent projects to run their own nodes to access private endpoints.

Similar to Moonbeam, Moonriver uses the Delegated Proof-of-Stake consensus mechanism and has its own native token called MOVR. Currently, there are 9,138,148 tokens in circulation, with up to 949,163 available for purchase.

Moonbeam Foundation

Source: moonbeam

The Moonbeam Foundation is dedicated to promoting the development and growth of Moonbeam and its ecosystem. It aims to achieve this by facilitating community programs and software development.

Moonwell

Source: moonwell

Moonwell is a lending platform operating on both Moonbeam and Moonriver. The project supports 44 assets across four networks, including Moonbeam, Moonriver, Base, and Optimism. Moonwell also boasts a market size currently over $475 million.

As a security-focused project, all Moonwell smart contracts undergo comprehensive audits from Halborn Security. Additionally, it features an ImmuneFI-powered bug bounty program set up to reward the discovery of vulnerabilities within the Moonwell ecosystem. The program has a maximum bounty of $250,000.

StellaSwap

Source: stellaswap

StellaSwap is the leading DEX and DeFi gateway on Moonbeam. It allows users to trade, earn, and stake DOT tokens to receive daily rewards. The Ethereum Virtual Machine (EVM) fully supports StellaSwap, which is home to several features, such as cross-chain transfers and XC transfers (more secure transfers), as well as revenue sharing and governance utilities for STELLA token holders.

In addition to partnerships with Moonbeam and Moonriver, StellaSwap has acquired many partnerships with Algebra, @squidrouter/moonbeam-users-rejoice-stellaswap-enables-seamless-cross-chain-swaps-via-squid-and-axelar-b28e39ba1ae4">Squid, Wormhole, Gamma, and Biconomy.

Moonbeam’s Tokenomics

What is GLMR?

GLMR is the native utility token of the Moonbeam ecosystem. It facilitates the project’s operations and governance and serves as an incentive for collators to maintain the node infrastructure’s security. It is also the main payment method of the Moonbeam ecosystem and supports the gas metering of smart contract execution.

GLMR Tokenomics

Source: moonbeam

GLMR has a total supply of 1 billion tokens, with a current circulating supply of and a market cap of. The token was distributed as follows:

• 14% was allocated to the seed funding round
• 12% was reserved for strategic funding
• 9.8% was set aside for the “Take Flight” community event
• 15% was reserved for the 2021 Moonbeam Crowdloan
• 3% was reserved for Parachain Bond Funding
• 0.5% was distributed to the Parachain Bond Reserve
• Another 0.5% was kept in the Moonbeam Treasury
• 16.7% went to the long-term protocol and ecosystem development
• 5% was reserved for liquidity programs
• 3.6% was allocated to the developer adoption program
• 3.9% was distributed to key partners and advisors
• 1.4% went to PureStake’s early backers
• 10% was allotted to founders and early employees
• 4.6% was set aside for future employee incentives

News on Moonbeam

In the fourth quarter of 2024, Moonbeam plans to integrate new features into its operations. These include the introduction of Agile CoreTime, which is a new feature introduced by Polkadot that allows projects to purchase coretime on-demand, rather than being locked into long-term leases.

Essentially, coretime refers to the computing resources projects need to operate smoothly on the Polkadot network. This will help Moonbeam scale vertically and allow for a significant increase in throughput and speed.

The project is also partnering with Glacis, a pioneering abstraction layer, to bring web2-level reliability to cross-chain interactions. As such, Moonbeam will be able to support leading GMP protocols, enable failover mechanisms, and parallel processing across multiple GMP providers. This integration will help Moonbeam significantly improve its security and reliability in cross-chain operations.

Is GLMR a Good Investment?

Moonbeam is a developer-oriented project that aims to help developers scale their projects’ operations across several blockchains at lower costs. With Moonbeam, developers can build new ecosystem projects or add more features to their Polkadot-based projects that aren’t already accessible on the Relay Chain. Additionally, it works hand in hand with its sister chain, Moonriver, where developers can deploy their dApps for testing before launching officially on Moonbeam.

As interesting as the project sounds, it is important to remember that the crypto market is very volatile. To that end, everyone is advised to do their due diligence or consult qualified financial personnel before investing in any project.

Take Action on GLMR

GLMR and its sister token MOVR can be purchased from centralized and decentralized exchanges like gate.io. Click here to browse and trade your preferred pairs.

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