Governance｜How to Launch a SALP Parachain Registration Proposal to Unlock Slot Bidding Liquidity
Polkadot Parachain Slot Auction has always been a vital liquidity release scenario. Bifrost has included the development of a Slot Auction derivatives of parachain in the roadmap since the auction launch. In September 2021, Bifrost launched the first Slot Auction Liquidity Release Protocol of Polkadot Ecology — SALP. Since then, SALP has been put into practice since helping Bifrost to bid itself. So far, SALP has supported 14 projects successfully to get parachain slots. By releasing liquidity for contributors, SALP can win supporters who are unwilling to lose opportunity costs for parachain candidate projects and significantly improve the success rate of bidding.
With the maturity of SALP and the normalization of the Slot Auction, we now encourage parachain candidate projects to self-connect SALP to increase the odds of winning the auction. This paper will explain the process of self-service docking, including the access application process, front-end page integration process, incentive activity process around SALP, etc.
The basic logic of SALP
SALP will create an intermediate account for each supported parachain candidate project, responsible for collecting the user’s contribution and sending it to the slot auction lock account on the relay chain instead of the user. There are two versions of SALP, which run on Kusama and Polkadot. The former is the official version. The relay chain allocates the intermediate account for Bifrost parachain (Bifrost has auctioned the fifth slot of Kusama to become Kusama parachain on July 20, 2021). The latter is the Lite version, and the intermediate account is a multi-signature escrow account controlled by multiple parties on the relay chain.
For more technical implementation information:
By contributing candidate projects through the SALP channel to parachain, derivatives vsToken (vsKSM or vsDOT) and vsBond will be obtained. vsToken is a fungible token that those who contribute 1 KSM / DOT will obtain 1 vsKSM / vsDOT, and vsToken can be traded or transferred at any time like other fungible tokens. vsBond is a semi fungible token. If you contribute 1 KSM / DOT, you will get 1 vsBond. vsBond represents the lease term of different parachains. Therefore, different vsBonds are obtained by contributing to different parachains.
vsToken and vsBond can redeem DOT / KSM after the slot lease expires. Meanwhile, vsToken can be traded on DEX; vsBond will be traded through a specific order book market. Bifrost has built several flow pools of vsToken and will create a unique trading market for vsBond. In addition, holding vsToken and vsBond can also partake in mining and obtain income (see the SALP mining section below for details).
Both vsKSM / vsDOT and vsToken can be realized at any time, which eliminates the user’s concern that the funds are occupied, and the opportunity cost is lost after the position is locked. Therefore, the parachain project connected to SALP protocol will be easier to succeed in bidding.
You can find more about vsToken and vsBond here.
How to apply for SALP support?
SALP access applications need to be voted through the Bifrost governance. It usually takes 9 days to complete the whole process. Please refer to the operation guide below.
1. Visit the Bifrost governance voting page.
2. Click Submit pre-image.
3. Fill in the parameters.
1. Select or enter your Bifrost address in the “Send from account” column ( the balance of at least 100 $BNC must be pre-deposited ).
2. In the Proposal column, select “SALP” or “SALPLite” from the order menu on the left (SALP for bidding the Kusama slot and SALPLite for bidding the Polkadot slot), and then select “create a new crowdloan fund” from the drop-down menu on the right.
3. Enter your parachain ID (paraID).
4 . Enter the maximum number of KSM / DOT you want to raise, that is, the Crowdloan hardtop value. The subsequent BNC is regarded as KSM / DOT.
5&6. Enter the start and the end time of the slot lease you want to auction.
7. The system will generate a pre-image hash. Please, copy and save it properly.
8. Click “Submit” pre-image to submit the application.
4. Submit your proposal.
In the previous steps, we have completed the “Submit” pre-image. The next step: we need to click on the “Submit” proposal in the upper right corner to open the following interface.
1. Paste the pre-image hash you just copied in the preimage hash column
2 . Locked balance enter is 100. It means you will deposit 100 $BNC, which will be returned after the governance vote (whether passed or not).
3. Click “submit proposal”.
5. Waiting for the governance voting results.
If the governance vote is passed, your SALP fund pool will be created, and your project will appear on the contribution list page in the Bifrost dapp :
The governance voting process takes about 9 days to complete. Due to the fluctuation of the blocking speed of the substrate chain, the specific voting completion time may be slightly shorter or longer than 9 days.
How to integrate SALP on the Crowdloan page?
Please, refer to Kusama and Polkadot SALP API: https://hackmd.io/erri6l3ESP690XEDC_zTnw
How are parachain crowdfunding rewards issued?
Since SALP performs contribution through Bifrost parachain address (excluding private key), the address runs completely under SALP tray logic: https://github.com/bifrost-finance/bifrost/tree/develop/pallets/salp
Therefore, we cannot directly allocate crowdfunding rewards for the project.
What is SALP Farming?
Each parachain candidate project supported by Bifrost will create a mining reward pool for contributors. Contributors will mine through lock-in vsKSM & vsBond to obtain funds in the reward pool. Candidates only need to do two steps:
- Create a prize pool on Bifrost
- Fill in the reward fund into the reward pool
You can find more details about How to create a prize pool here.
As the core of Bifrost’s liquidity business for the slot auction, the SALP module has accumulated 170,815 KSM & 1,589,600 DOT derivatives since its launch in September with a market value of about US $80,554,425.
If required by the partners, Bifrost will also provide them with Crowdcast AMA to introduce and explain the crowdloan rules of the cooperation project to the Bifrost community. After AMA, the video will be uploaded to Bifrost YouTube and then re-published on Twitter, Telegram, and Discord. To see more of the Bifrost’s crowdcast videos: https://www.crowdcast.io/bifrost-finance
What is Bifrost?
Bifrost is the Polkadot Ecological DeFi basic protocol. It is committed to becoming an infrastructure for staked assets to provide liquidity. Bifrost has launched derivatives vToken for Staking and Polkadot Parachain Slot (Crowdloan). It has obtained $2.15M fundraising from NGC, SNZ, DFG, CMS, Web3 Foundation Grant, and other institutions. Bifrost is also a member of the Substrate Builders Program and a Web3 Bootcamp.
vToken can optimize transactions in multiple scenarios such as DeFi, DApp, DEX, CEX, and realize the transfer channel of stake rights such as staking and Crowdloan through vToken. Moreover, it can recognize the risk hedging of stake assets and expand scenarios such as vToken as collateral for lending. Its staking reward part can be offset to achieve low-interest loans.