Moonbeam: A Cross-Chain Smart Contract for Polkadot
Updated: Jul 24
Moonbeam is a decentralized platform that was founded in early 2020 with the goal of addressing the challenges of inter-network interactions in the blockchain space. They aim to provide a seamless and interoperable solution for different blockchain networks to interact and exchange information and assets. The project is focused on providing a bridge between the Ethereum network and other blockchain platforms, making it easier for developers to build dApps that can interact with existing infrastructure.
What is Moonbeam?
Moonbeam is a specialized Layer 1 blockchain that goes beyond just being an implementation of the EVM. It mirrors the Ethereum Web3 RPC, including features such as accounts, keys, subscriptions, logs, and others. In addition to these standard Ethereum features, Moonbeam enhances its offering with on-chain governance, staking capabilities, and the ability to integrate with other blockchain networks.
The platform is built on top of the Substrate framework, which provides a modular, customizable blockchain development platform. Simply put, Moonbeam serves as a bridge between Ethereum and Polkadot allowing for seamless transfer of data and assets.
Moonbeam plans to expand its reach and make bridges for other blockchain networks in the future, further increasing its ability to promote interconnectivity within the wider blockchain ecosystem.
What's Makes Moonbeam Unique?
Moonbeam is equipped with a full implementation of the EVM, making it possible for developers to deploy Ethereum-based dApps and smart contracts on the Moonbeam network with little to no modifications.
The platform offers publish-subscribe functionality and compatibility with Ethereum addresses, further streamlining the migration process for developers. This means that existing Solidity-based APIs and smart contracts can be easily transferred to the Moonbeam network with minimal modifications, providing a seamless transition for developers.
The Moonbeam Ecosystem:
Moonbeam provides a user-friendly interface for Solidity developers looking to create on the Polkadot network. With similar languages and tools, the transition is seamless and intuitive. Furthermore, there's no need to create a new address, account, or signature, as you can use your existing Ethereum H160 accounts and ECDSA signatures to interact with Moonbeam.
As a bridge between Polkadot and Ethereum, Moonbeam enables developers to deploy their decentralized applications and projects from Ethereum onto the Polkadot network, thereby expanding their reach to new users and tokens available on the platform. This makes Moonbeam an ideal solution for three different groups:
Existing Ethereum projects facing the scalability and cost issues of the Ethereum network can now benefit from the expanded capabilities of Polkadot through Moonbeam.
Projects on Polkadot that require the functionality of smart contracts can now take advantage of the interoperability provided by Moonbeam.
Dapp developers who want to use the capabilities of the Polkadot network can now do so through the ease of development provided by Moonbeam.
By offering a seamless and efficient solution for linking Ethereum and Polkadot, Moonbeam is poised to play a key role in the decentralized application ecosystem.
GLMR is the proprietary token of the Moonbeam network, and it is an integral part of the platform's design and functionality. The GLMR token serves several key purposes, including supporting the gas metering process for executing smart contracts, incentivizing collators to participate in the network, and powering the decentralized node infrastructure that supports the platform's operation.
Additionally, the GLMR token is used in the platform's on-chain governance mechanism, enabling users to participate in various democratic processes such as proposing referenda, electing council members, and voting. Furthermore, GLMR tokens can also be used to pay for transaction fees within the network, making it a versatile and valuable asset for users.
he Glimmer token (GLMR), which operates on the Polkadot network, has an annual inflation rate target of 5% with no cap on its maximum token supply. This 5% inflation rate is used to pay for the ongoing cost of a parachain slot on Polkadot, as well as to reward network participants.
Of the 5% inflation rate, 1.5% goes towards funding the parachain bond reserve, 1% is set aside to incentivize collator nodes, and the remaining 2.5% is returned to GLMR token stakers who help with the block production process.
However, the Moonbeam network also incorporates deflationary elements through its use of the GLMR token. When executing transactions through smart contracts, users must pay a fee to cover the computational gas required by nodes, along with a small platform fee. This fee is split between two protocols, with 80% of the GLMR tokens received as fees being burned. This serves as a deflationary force by increasing scarcity, as the GLMR token has no capped supply. If the number of GLMR tokens burned from transactions and fees on the Moonbeam network exceeds the 5% annual inflation rate, GLMR will become a deflationary asset.
The 20% that remain are sent to the on-chain Treasury, and how these funds are spent will be decided through on-chain governance proposals. This includes covering the costs of initiatives and projects aimed at promoting adoption and engagement with the Moonbeam network.
Moonbeam is a standout player in the Polkadot network, providing full compatibility with Ethereum and a range of capabilities that sets it apart from other blockchains. While some platforms offer only a limited set of features, Moonbeam provides an almost identical experience to Ethereum, but with the added benefits of reduced costs and improved scalability.
The full implementation of the EVM and the ability to use existing Ethereum addresses, accounts, and signatures, makes it easier for developers to migrate from Ethereum to Moonbeam with minimal changes. Moonbeam’s unique feature set makes it the go-to option for developers looking to build on the Polkadot network while maintaining the familiarity and simplicity of Ethereum.
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