Existential Deposit on Polkadot and Kusama Network
In Polkadot (and Kusama) blockchain, the user's account balances should always stay above or equal to a minimum value. Otherwise, the balance will be completely wiped off by the blockchain. This minimum value is referred to as Existential Deposit (ED). In Polkadot and most Substrate-based chains, wallet accounts with low balances are automatically emptied to keep the blockchains safe and efficient. These low balance accounts are called dust accounts and they need to be completely removed (reaped) from the blockchain and have their nonce reset to prevent them from bloating chain state.
The Existential Deposit of the Polkadot blockchain is currently set at 1 DOT (and 0.0000333333 KSM on the Kusama network). Without the Existential Deposit feature, a user could create 1,000,000 accounts of 0.000001 DOT each from 1 DOT. In the event that many users do this, the network becomes congested (bloating), making it slower, unsafe and expensive to manage — the fee also increases.
Important: In order for your wallet not to be deleted, it must be active. To keep your wallet active, you must keep at least 1 DOT or 0.0000333333 KSM on the Polkadot and Kusama networks respectively.
Here is a list of what you need to know regarding Extensional Deposit:
- If you are sending all (or almost all) of your funds out of an account, which will result in the remaining balance going under the ED, the account will be reaped and any remaining funds will be burned. Anyway, an account can be reactivated anytime, however, this will not bring back any previously burned funds.
- Accounts that have never received a deposit are not discoverable on block explorers like Subscan.
- If you send funds lower than the Existential Deposit (1 DOT or 0.0000333333 KSM on the Kusama network) to an empty account, the transaction will fail.
- When contributing to crowdloans using Parallel Finance make sure that your balance doesn’t drop below the Existential Deposit or that you contribute your entire balance.
- To protect yourself from accidentally slipping below the ED amount and losing your funds, keep the option “transfer with account keep-alive checks” enabled when sending.
Note: You can send your entire balance out anytime. The existential deposit is NOT unspendable. It just keeps your account alive. If you decide you want to deactivate this account, you can send your entire balance out anytime. You just need to disable the “keep-alive” check to transfer your entire balance.
About Parallel Finance
Parallel Finance is a user-focused DeFi protocol that has evolved to become a hub for DeFi use cases and solutions. It features a suite of DeFi super dapps that include Staking and v2 Decentralized Crowdloan. The platform is committed to building a decentralized future that empowers the community to increase DeFi capital efficiency, security, and accessibility.
We are one of the largest parachains in the Polkadot space with over $700M+ TVL and 200K+ active users and have some of the best investors including Sequoia, Founders Fund, Coinbase, Polychain, etc. The platform has a rapidly growing global team of over 90 doers from top organizations in and outside the cryptocurrency space, including The World Bank Group, Dash, Crypto.com, ChainLink, Meta, Polygon, Ledger, JP Morgan, Standard Chartered, Amazon, BlockFi, etc and we are still hiring!
Stay in touch with us.
Website: https://parallel.fi
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