DApp AppChain Exploration: Ideas to Break Performance Constraints

Recently, there has been a lot of discussion around the abandonment of Ethereum and whether leading projects should build their own AppChains. This article analyzes several cases of top products and discusses potential new attempts between chains and DApps using Polkadot as an example for readers' reference.

Background

A few weeks ago, StepN, as a Web3 application, sparked heated discussions in the domestic internet circle and successfully broke through the boundaries. However, StepN has not become a product that can continuously create a positive cycle; instead, it has been tested by the fluctuations in the financial market.

The popularity of StepN has also caused congestion on the Solana network, which greatly deviates from the vision of blockchain and Web3. If Web3 is to have a wider user adoption, the current situation is clearly not a good infrastructure.

Based on this, we began to consider whether there are new possibilities between blockchain and applications, exploring new attempts between chains and DApps. This article will share some ideas from the perspective of Polkadot's parachains for reference.

DApp is looking for a better landing point

With the rise of mainstream public chains like Ethereum and Solana, a large number of DApps have begun to emerge. DApps are decentralized, directly connecting users and developers, allowing assets to truly belong to users while possessing trustworthy application attributes.

All data on the DApp is encrypted and stored on a decentralized blockchain application platform, offering higher security performance, effectively preventing information from being tampered with and forged, greatly improving the stability of the project, and reducing downtime risks and operational costs.

If blockchain is the infrastructure for DApps, then the prosperity of the public chain ecosystem largely depends on the types, quantities, and performance of DApps. DApps will carry multiple missions such as revenue, scenarios, and transactions, so DApps need a foundational blockchain that can support their commercial operations.

How are current DApps addressing the performance issues of their respective blockchains? The following three cases may provide us with some insights.

1. Self-built Layer2

Axie Infinity is a turn-based card battle game that uses a P2E model. As the number of users has exploded, the performance of Ethereum has gradually affected the normal use of Axie Infinity. To solve this problem, Axie Infinity chose to develop a sidechain called Ronin based on Ethereum.

On December 24, 2020, Axie Infinity migrated to the Ronin chain. Transactions on the Ronin chain can be completed almost instantly, with Gas fees being negligible. Axies can be freely transferred between Ethereum and Ronin. This has facilitated the growth of the number of Axies, breeding costs, and market transaction volume.

The Ronin chain uses the Proof of Authority (PoA) consensus mechanism, encouraging validators to maintain transactions by attaching reputation to identities. It employs fewer validating nodes, currently 7, achieving faster transfer speeds. Currently, the validating nodes of the Ronin network include a certain trading platform, Ubisoft, and Animoca.

( 2. Finding Layer2 dedicated chains

Illuvium is an open-world blockchain RPG game, a fully 3D game aimed at becoming the first AAA game project. Its gameplay is a combination of several popular online games, including elements of capturing and breeding beasts, as well as battles.

Illuvium has chosen Immutable X as its underlying blockchain infrastructure. Immutable X is a Layer 2 protocol specifically developed for NFTs on Ethereum, utilizing ZK Rollups technology to enable gas-free minting and trading of NFTs.

Based on these attributes, Immutable X has also attracted other well-known blockchain games to deploy on it and has received investments from some well-known institutions.

) 3. Find Layer 0 to build a dedicated Layer 1

DeFi Kingdoms is a pixel-style blockchain game developed based on the Harmony Protocol. It gamifies DeFi products, rules, and usage processes, integrating them into an engaging and synergistic game to enhance the fun for users using the products.

During its development, DeFi Kingdoms gradually became limited by Harmony and subsequently chose to cross-chain to Avalanche. After Avalanche launched the subnet ###Subnet###, DeFi Kingdoms announced on April 1st of this year that it would run the subnet DFK Chain on Avalanche.

The subnets of Avalanche are essentially a subset of mainnet validators responsible for the security of their respective networks. These subnets possess a high degree of autonomy, allowing them to independently choose the number of validators, set requirements for validation nodes, support custom network Gas tokens, and configure fee parameters to reduce user costs.

From a certain perspective, Avalanche is a Layer 0, while its subnets can be seen as Layer 1. DFK Chain has processed over 4 million transactions and reached a total market cap of 360 million USD just over a month after its launch.

Polkadot's parachains might be an excellent choice for DApps

DeFi and DApps have some differences. DeFi focuses on the composability of digital assets, allowing these DeFi and their assets to interact with other DeFi, introducing more assets to perform better. In contrast, DApps, such as projects like Axie Infinity or StepN, focus on an intrinsic and complete economic system, where the assets can operate autonomously without the need to interact with third-party projects.

The former hopes that the blockchain ecosystem they are in develops well, with a wealth of interactive assets; the latter is more concerned with whether the performance of the blockchain they are in meets their own needs and does not affect their operation, and temporarily has low demand for making their own tokens or NFTs more combinable.

Based on these characteristics, many DApps are looking for more reliable underlying blockchains for support, hoping for higher performance ( TPS, while keeping gas fees low, preferably not affected by the underlying blockchain, and focusing on their own development.

Therefore, finding a reliable and effective AppChain has become one of the top concerns for DApp teams. From these factors, it seems that Polkadot's parachains becoming a dedicated chain for a certain DApp is a good solution, as Polkadot's parachains align with many of the needs of DApp teams.

1. The current performance of parallel chains is much higher than that of Ethereum, with theoretical TPS reaching thousands, and as a PoS chain, the gas fees are very cheap.

2. If a parachain only runs a specific DApp, it will not encounter some issues present on general smart contract chains, such as chain congestion caused by other applications affecting its own operation.

3. The development difficulty is relatively low, and using Polkadot's modular framework Substrate, the required functions can be quickly assembled into a chain. The difficulty of developing a Substrate chain is lower than that of developing Layer 2.

4. Higher security. The security of the parachain is managed by Polkadot, which interacts with other Polkadot parachains through its own XCM. Its security is higher than that of cross-chain bridges between different public chains.

5. You can enjoy the advanced architecture of Polkadot and have scalability. Substrate continuously iterates new features, making it easier for teams to add new functionalities to their chains, and the upgrades of the chains are more rapid.

6. Polkadot's parachains are compatible with EVM, allowing teams to transition from the EVM ecosystem to Polkadot without major changes to the DApp code.

7. Polkadot has strong interoperability, joining the Polkadot ecosystem is equivalent to interacting with numerous ecological projects in a way that is safer than cross-chain bridges, meeting the needs of DApp assets to interact with other projects after becoming self-contained.

8. Parachains belong to Layer 1. If the DApp team needs more performance and vertical scalability, parachains can also expand to Layer 2.

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Areas for Improvement in Polkadot

Although Polkadot's parachains have their unique advantages as an AppChain, they have not yet become the preferred choice for many DApps for the following reasons:

1. Performance still needs to be further improved to meet the needs of certain DApps. One of the important tasks for Polkadot going forward is to continue optimizing network performance, including upgrades like asynchronous support.

2. The cost of connecting to the Polkadot ecosystem seems to be too high. However, in reality, the cost of slot auctions has been significantly reduced, and parallel threads are actively being developed, which will support access to Polkadot at a very low cost in the future.

3. The lack of successful cases to attract more DApp teams to adopt. The urgent task is to have a case in cooperation with the official to take the first shot and explore a replicable successful path.

4. During the industry's downturn phase, many DApps struggle to go against the trend, and user participation willingness significantly decreases. We need to wait for the arrival of the next rising cycle.

In the future, with the development of technology and the improvement of the market environment, the Polkadot ecosystem may see a scenario of "one DApp one parallel chain". Whether it is GameFi or NFT-related applications, they may bring new user growth. At that time, the relationship between chains and Apps may have a new pattern, and perhaps the logic of "one DApp one chain" will be validated.

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