Polkadot Parachain Spotlight: Making a Statemint and setting the standard
Polkadot’s first parachain wasn’t a cutting-edge DeFi platform; it was critical infrastructure. Here’s how and why this “common-good” parachain was a necessary pioneer.
TL;DR
- Statemint is a generic assets parachain that provides a public service for creating, tracking, and moving assets on Polkadot and Kusama Networks,
- It allows anyone to deploy an asset by staking an adequate amount of $DOT (or $KSM),
- It’s a critically important piece of infrastructure for DeFi,
- As a ‘common-good’ parachain, it’s controlled by the community through Polkadot’s (and Kusama’s) governance systems.
Why is Statemint special?
Most Polkadot parachains need to win an auction to be granted a parachain slot. There are good reasons for this, the most important being very strong network security. But another class of parachains exists in the Polkadot ecosystem: Common Good Parachains. These public services are here for everyone’s benefit and are a shared responsibility of the network. Any desired changes require a proposal, some lengthy discussion, and a voting process through Polkadot’s governance systems.
By deploying and managing these necessary common-good parachains through Polkadot’s governance systems, the network participants that best understand the value of these public services can ensure they’re properly maintained and that the necessary resources are made available to sustain the parachain’s functions.
So, what does Statemint do?
StateMint is a ‘generic asset’ parachain that allows any entity to deploy assets on the Polkadot Network. This could be a DeFi platform issuing a stablecoin, an artist issuing a coin representing their artwork, or even a central bank issuing their digital currency. If you can provide the appropriate deposit (currently 100 $DOT), you can issue your asset on the network. Statemint is designed to be a basic chain that provides an interface for representing and handling assets. The creator of any asset deployed through Statemint will retain responsibility for determining the economic parameters of each deployed asset. Asset creators can establish a “maintenance team” comprised of individuals or multi-sigs that grants permission to mint, freeze, or burn tokens. If there’s a desire to remove the ability for anyone to tamper with an asset’s supply, the “admin team” can be set to provably inaccessible accounts.
Deposits and fees are around 10% of the current Relay Chain transaction costs. By separating the logic for handling token transactions into a separate parachain, other chains can focus on optimizing for their particular specializations.
Why do we need this?
Polkadot has a native token. What other types of assets can be created using Statemint, and why would we need them?
Digital assets can represent a broad spectrum of goods and services. They typically fall into these three categories:
- Assets backed by a protocol’s utility — an asset granting holders voting rights, or tokens used to meter access to a network.
- Assets backed by off-chain reserves — anything from real estate to artwork or stablecoins or assets from other consensus systems.
- Assets with no backing — purely trust-based, the community collectively determines the value.
Polkadot-friendly versions of assets from each category are needed and desired on-chain. We needed a tool for representing all types of valuable assets. Statemint fills this role of being the critically important infrastructure that allows the Polkadot and Kusama ecosystems to interact with the rest of the on-chain and off-chain world.
What about NFTs?
Thanks to Singular and RMRK, Kusama now has native NFTs, but there are still challenges to address before seeing native NFTs on Polkadot. Currently, you can create an NFT asset on Statemine. Still, due to the minimalistic design of Statemint to only support tracking of asset balances, any NFT marketplace that tries to use Statemine NFTs would be subject to several vulnerabilities and centralization issues. This is covered quite well by one of RMRK’s founders in this post. The short explanation is that Statemint wasn’t designed to be the foundation of a marketplace. The RMRK team intends to create an implementation to make Kusama’s RMRK NFTs transferable to Polkadot and many EVM and non-EVM compatible chains.
Short and Sweet
We’ve seen several great overviews for most of Polkadot’s newest parachains, but we felt like this one was overlooked and not as well understood. We hope this article clarifies Polkadot’s first Common Good Parachain and helps people understand the foresight and careful consideration put into the overall architecture of the DotSama ecosystem.
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