With parachains coming to Kusama, this summer promises to be hot. A selected group of Substrate projects will join Polkadot’s canary network as the first parachains which will support the thriving ecosystem on its journey towards becoming a truly scalable multichain network.
Of course, we would not pass on such an opportunity. Deep down, we know that a wild party like this needs Basilisk.
To join the party, we need your help. Parachain slots on the Kusama network are limited and distributed to the most worthy projects using an auction mechanism. In order to participate at the parachain auctions, Basilisk is launching a crowdloan campaign.
A crowdloan allows community members to support the project by locking some amount of KSM tokens for the duration of the parachain slot. As a compensation, supporters receive a generous amount of BSX tokens on top of their KSM stake.
At Basilisk, we cherish early community support which is why we have decided to allocate a total of 15bn BSX tokens (representing 15% of the total supply) to the community backers who lock their KSM tokens for the duration of 48 weeks to support Basilisk’s candidacy for a parachain slot.
In this post you will find a short intro to parachains, auctions and crowdloans, as well as some compelling reasons why you should support Basilisk at this early stage.
Parachains, Auctions and Crowdloans
The Kusama network consists of a single relay chain and several parachains. The relay chain acts as the heart of the network - it is responsible for its shared security, consensus mechanism and cross-chain interoperability.
Parachains, on the other hand, are sovereign blockchains which focus on specific use-cases and have their own tokens. Being connected to the relay chain, they are able to communicate with each other cross-chain while enjoying a high grade of shared network security.
The relay chain of Kusama can only support a limited number of parachains. This scarcity creates the need to fill the available spots with selected projects which are most beneficial to the ecosystem. For that purpose, the concept of parachain auctions was introduced.
In a parachain auction, candidate projects bid an amount of KSM which will be locked for the duration of the parachain slot. In Kusama, this period amounts to 48 weeks (1 year). The available parachain slots are allocated to the projects with the highest bids.
Crowdloans help candidates raise sufficient funds to participate in the parachain auction. In a crowdloan, community members can support the projects of their choice by locking up some amount of KSM tokens for the duration of the parachain slot. Once the parachain slot expires, all locked KSM tokens return to their owners.
On top of that, crowdloan backers receive a bonus to compensate for the opportunity costs of locking up their KSM. As stated earlier in this post, we are allocating 15bn BSX tokens (representing 15% of the total supply) to the community backers who lock their KSM tokens to support Basilisk’s candidacy for its first parachain slot.
Basilisk is a liquidity bootstrapping protocol built for Kusama. Our mission is to become the go-to liquidity provider with a focus on the long tail of assets. By doing so, we are determined to spearhead rapid liquidity acquisition for the Kusama ecosystem, alongside projects such as Karura and Zeitgeist. In the long run, we believe that Basilisk will become an essential component of Kusama’s DeFi movement.
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To achieve this mission, Basilisk is building customizable and highly efficient liquidity bootstrapping pools (LBP). Furthermore, a system of layered incentives will make sure that new projects have sufficient perks to bootstrap liquidity using our LBPs. All capital flows into the Basilisk will be rewarded with BSX tokens.
Our liquidity mining incentivization scheme is designed to pump blood into Kusama’s veins thus helping cross-chain DeFi come to life. The first potential participants who are willing to bootstrap liquidity using the Basilisk LBP have already expressed their interest.
Basilisk is furthermore exploring alternative routes which allow new projects to participate in parachain auctions. Provided that the projects accept KSM in their LBP, they will be able to fund, at least partially, their own parachain slot. We would like to encourage founders to seek KSM liquidity via LBPs and help ease the pressure of parachain acquisition.
Finally, we should mention that Basilisk is planning to bootstrap liquidity of its own by launching an LBP event of its native BSX token. The LBP event will take place once Basilisk becomes a parachain of Kusama, make sure to subscribe to our newsletter to not miss anything.
How to Support Basilisk
Helping Basilisk join the parachain party is worth it! Besides earning generous BSX rewards, you will help us on our journey of building the liquidity infrastructure of the future.
If you are currently staking KSM, we kindly remind you to unbond your KSM now - unbonding takes 7 days, and you might be late to the party.