Introducing Heiko: Parallel’s Parachain on Kusama

Parallel Finance
Jul 6 · 6 min read

Heiko’s Kusama Parachain Auction

Parallel Finance is a decentralized money market protocol that offers lending, staking, and borrowing in the Polkadot ecosystem. Similar to the relationship between Polkadot and its “canary network” Kusama, Heiko Finance is the sister network to Parallel, and the parachain that we hope to launch on the Kusama blockchain. We are building for a decentralized future that empowers the community to increase capital efficiency, security, and accessibility through our leverage staking and auction lending platform. Today, we are excited to announce that Heiko will be participating in the Kusama parachain auctions. We welcome you to support us and stay tuned for more updates in the coming weeks!

TL;DR

  • Heiko, powered by Parallel, is hosting a crowdloan to compete for a Kusama parachain slot.
  • Contributors will be rewarded with Heiko tokens (HKO) and 5% of the HKO total supply will be distributed accordingly.
  • Refer a friend, we’ll send each of you an additional 5% bonus HKO. For example, if you refer someone who contributes 10 KSM to the crowdloan, you will both receive an additional .5 KSM’s (5%) worth of HKO.
  • You can review Heiko’s parachain info here.

Heiko Token Distribution

Users who want to play a part in Parallel’s future are encouraged to participate in Heiko’s crowdloan. In return, contributors will receive a weighted distribution of 5% of HKO, Heiko’s governance token. This 5% will be split among all of the contributors in the parachain auction, and released according to a vesting schedule if/when Heiko wins a parachain auction. 200,000 KSM is the max we will raise. If we raise more than the max, the contribution will be capped. We will reward a maximum of 500,000 HKO tokens as the reward for participating in the auction, plus an additional percentage for referred participants. The HKO token conversion rate will be determined by this formula:

Reward Rate = total HKO rewards / total KSM contribution

Refer a Friend

We have found that rewarding our most active users with piecemeal incentives is the best way to encourage future participation and grow the community. There will be many future opportunities for users to participate, and earn HKO. Over the next month, we will release a detailed guide for users interested in participating in the auctions that will describe the timeframes for participating, as well as the crowdloan contribution process using polkadot.js. In this guide, we will also include information on our referral system, which will allow users to generate unique referral codes, and earn more HKO by referring others to the auction. If you refer a friend, you and your friend will both receive an additional 5% bonus. For example, if you refer someone who contributes 10 KSM to the crowdloan, then you would both receive an additional .5 KSM’s worth (5%) of HKO. There is no limit to the number times a code can be used, and the additional referral rewards will be sourced from the community supply.

HKO’s Utilities

  • HKO token holders are delegated with voting rights and the ability to propose governance action, referenda, network upgrades, council elections, and other parameter adjustments.
  • HKO is a native fee token that is required to execute the functionalities and security of the protocol.
  • The native token is utilized to incentivize collators and validators, which is the mechanism that powers the decentralized node infrastructure of the network.
  • HKO token is utilized to hedge risks, incentivize rewards, and share profits. The insurance parameters are determined by HKO token governance in the event of a slash.
  • HKO will be burned whenever a fee is paid on our platform. These fees include money market fees, staking/unstaking fees, transaction fees, and any fees in our future fixed-rate products as well.
  • HKO will be added as an incentive for users to stake, lend, and borrow on Heiko.
  • Validators will have incentives to hold HKO in order to be whitelisted in our node evaluation schema/algorithm. The more HKO they hold, the better their chances will be of being nominated by our stakers.

Heiko’s Markets

Once launched, Heiko will offer liquid staking on Kusama. On Heiko’s lending interface, users will be able to compound their KSM stake with greater effectiveness than they ever have in the past, with minimal risk. Leverage staking allows you to lend against your staked assets, to earn interest from staking and lending at the same time. In addition, when Heiko receives the user’s KSM, it stakes them to the network by algorithmically nominating the most reliable nodes on behalf of the user. For comparison, with a custodial staking solution like Kraken, users receive a flat annualized yield of 12%. In this instance, the user does not strictly have possession of their coins, because Kraken takes custody of them. Compare this with Heiko, which is noncustodial and tailored to the users needs, offering APYs as high as 20% when leverage staking is added.

Parachain auctions give users access to early liquidity via incentives, like the HKO given to our crowdloan participants. Heiko’s auction lending module will amplify this dynamic by allowing Heiko users to lend their DOT and KSM to auction participants for a fixed or floating interest rate, and a percentage of future equity to be determined by the project borrowing. If the borrowers win their parachain auctions, they pay their interest rate for the borrowed coins, which are locked for a defined period of time, usually between six months and two years. If they lose, users have the choice of extending their loan until the next parachain auction, or taking their loan back. When the parachain lease period ends, the coins will unlock from the parachain, and be returned to their lenders. Initiating this utility on Kusama will give Heiko and Parallel the go-to-market brand identity as the official auction lending platform, which will in turn attract the leaseholders launching on Polkadot.

Join the Crowdloan Waitlist:

Get ready for the upcoming Heiko crowdloan.

Join the Waitslist HERE

A special thanks to our partners for their continued support

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Disclaimer:

This article contains forecasts, projections, goals, plans, and other forward-looking statements regarding Parallel’s financial results and other data. Such forward-looking statements are based on Parallel’s assumptions, estimates, outlook, and other judgments made in light of information available at the time of preparation of such statements and involve both known and unknown risks and uncertainties. Accordingly, plans, goals, and other statements may not be realized as described, and actual financial results, success/failure or progress of development, and other projections may differ materially from those presented herein. Even when subsequent changes in conditions or other circumstances make it preferable to update or revise forecasts, plans, or other forward-looking statements, Parallel disclaims any obligation to update or revise this article. Information concerning risk or returns (including features under development) contained herein is not intended as advertising or as financial advice.

Parallel Finance

Decentralized Lending Protocol