Moonbeam: A fully EVM compatible network on Polkadot

Blockchain’s lack of interoperability is not a novel nor readily solvable issue. Interoperability may be the most challenging obstacle between blockchain and widespread use. That’s one of the many problems Polkadot and its ecosystem are trying to resolve. Moonbeam Network is one of the Parachains within the Polkadot ecosystem.

Moonbeam brings a fully Ethereum-compatible network on Polkadot. This allows many blockchain projects that are currently been deployed on Ethereum network or other EVM-compatible (Ethereum Virtual Machine) networks to fairly easily deploy their solutions on Moonbeam. With the support of Polkadot’s infrastructure, all applications built on Moonbeam will be able to leverage the plethora of applications built on other Polkadot parachains. Moonbeam provides an essential building block toward Polkadot’s vision of building the foundation of Web 3.0.

What is Moonbeam?

Moonbeam Network - Moonbeam Polkadot - What is Moonbeam

Moonbeam is an EVM-compatible smart contract platform that is deployed as a parachain on Polkadot. Moonbeam’s GLMR is the native token of the network. Thanks to Moonbeam, the Ethereum developers that are beginning to extend to Polkadot may benefit from a more streamlined user experience. Interoperability between Moonbeam and other parachains can be achieved with Polkadot’s cross-chain communication protocol XCM. Using bridge technology Moonbeam can also communicate with other non-native Polkadot networks.

When developing on Moonbeam, developers have the power to build smart contracts in Solidity for anything that can be compiled into EVM (Ethereum Virtual Machine) bytecode. This capacity is available to them regardless of what they are creating. In addition, if a project team already has EVM-compatible smart contracts written for Ethereum network, those contracts will operate immediately on Moonbeam without requiring the contracts to be rewritten or reconfigured. 

On Moonbeam, EVM-based applications will be able to use the interoperability that Polkadot provides without rewriting their code or adapting to a substrate-based system. This will be possible since Moonbeam will support both Polkadot’s and Ethereum’s technology. In addition, Moonbeam makes it possible to utilize pre-existing tools and dApp front-ends by integrating well-known tools like MetaMask, Remix, Hardhat, Waffle, and Truffle to a full set of Web 3 RPC endpoints. 

Here’s a list of key points on how Moonbeam helps projects with EVM experience build on Polkadot: 

  • Changes to the codebase are kept to a bare minimum: if you already have a contract in place, you will not need to rewrite it or tweak it for it to operate. 
  • Language Support: Smart contracts may be written in Solidity or any other language that can compile to EVM (Ethereum Virtual Machine) bytecode. 
  • Utilize Pre-Existing Tools and dApp Front-Ends: Connect well-known tools like MetaMask, Remix, and Truffle by using comprehensive Web3 RPC endpoints. Utilize popular Javascript libraries like Web3.Js or Ethers.Js. 
  • Core Developer Integrations consists of over sixty integrations with the developer tools and services sought the most, such as APIs, assets, bridges, DeFi protocols, oracles, and many others. 
  • Thanks to Moonbeam’s support for unified accounts, addresses, and signatures, users may interact with Moonbeam using their current Ethereum H160 accounts and ECDSA signatures thanks to Moonbeam’s support for unified accounts, addresses, and signatures.

A Brief History of Moonbeam

Moonbeam Network - Moonbeam Polkadot - Moonbeam History

Derek Yoo, a successful entrepreneur in the field of information technology and the chief executive officer of PureStake, and a co-founder of the Fuze communication platform established Moonbeam in January of 2020. Yoo launched the Moonbeam Testnet in September 2020 after earning a grant from the Web3 Foundation; however, the project would not achieve significant popularity until more than a year later, when the Moonbeam user community started an attempt to secure a parachain spot on the Polkadot blockchain. Polkadot is a multi-chain network that enables interoperability through the primary relay chain. This will ultimately make it possible for up to one hundred different parachains to trade tokens, services, and other forms of data with one another.

Beginning on December 17, 2021, the Moonbeam launch procedure offered incrementally new features over three weeks. As soon as the block generation and decentralization were completed and confirmed to be operating well, the team moved on to the last phase of the launch, during which the superuser key (Sudo) was removed, EVM (Ethereum Virtual Machine) and balance transfers were allowed, and the number of active collators was extended to 48. Balance transfers let users begin staking with collators, obtain crowd loan incentives, and serve as active network participants by engaging in the on-chain governance system.

On January 11, 2022, Moonbeam, the completely Ethereum-compatible platform for smart contracts on Polkadot, finished its launch procedure. Moonbeam is the first fully operating parachain atop Polkadot, allowing the deployment of over 80 Moonbeam ecosystem enterprises. Similar to how its sister parachain, Moonriver, boosted DApp installations and used the Kusama network, Moonbeam is anticipated to bring substantial activity to Polkadot. 

Recent Developments

On May 12, 2022, Moonbeam announced a cross-chain link with the Acala network utilizing bidirectional HRMP channels, enabling native conversations and token transfers between the two chains without any need for bridges. 

So far, this represents the first XCM-based connection on Polkadot since XCM was launched in early May. However, many more are likely to follow in the same way XCM-based connections have proliferated on Kusama. ACA and GLMR, the chains’ fundamental utility tokens, and aUSD, Acala’s decentralized stablecoin, will now be freely transferable and usable inside the DeFi ecosystems of both parachains. After Moonbeam’s runtime update later this month, GLMR will be accessible on Acala.

Moonbeam’s Vision

Moonbeam Network - Moonbeam Polkadot - Moonbeam Vision

The developers behind Moonbeam envisioned a multi-chained future, with many chains, and numerous users and assets on each of those chains. As a result, they decided to develop Moonbeam – this smart contract platform that offers an environment that is compatible with Ethereum network and can be us to construct decentralized apps. Moonbeam was developed to support the new assets and users that span several chains. This was the motivation for its creation. 

The currently available platforms for smart contracts are intended to support the users and assets associated with a particular chain. Moonbeam enables developers to extend the reach of their applications to new users and assets on other chains by providing the functionality of cross-chain smart contracts. This allows programmers to transition existing workloads and logic to Moonbeam. Moonbeam was developed to provide this functionality. 

Moonbeam’s GLMR token Utility

Moonbeam Network - Moonbeam Polkadot - GLMR Token - Moonbeam Crypto

Moonbeam is a decentralized platform for smart contracts, and for it to work, it needs a utility token. Overall, it is impossible to remove this token from Moonbeam without compromising the paltform’s core operation since it is integral to the game’s design. Moonbeam’s native token is called Glimmer or GLMR. Uses for the Moonbeam token include the following: 

  • Assisting with the gas metering of the execution of smart contracts 
  • Providing financial incentives to collectors and fueling the mechanics involved in the establishment of a distributed network of nodes upon which the platform may function 
  • Providing support for the mechanism for on-chain governance may include activities like voting, proposing referenda, and electing council members. 
  • Paying transaction fees for the network 

Moonbeam’s Governance

Moonbeam Network - Moonbeam Polkadot - Moonbeam Governance

Moonbeam’s governance dynamics aim to promote the protocol per the community’s aspirations. Consequently, the governance approach strives to incorporate core developers, application developers, collators, users, and other contributors into this common objective. Governance forums like Polkassembly allow for open dialogue and the refinement of ideas based on community participation. Autonomous implementations and forkless enhancements unify the community in its aim to progress the protocol. 

The following serve as guiding “soft” principles for interaction with Moonbeam’s governance process: 

  • Being inclusive of token holders who want engagement with Moonbeam and who are impacted by governance choices 
  • Favouring token holder interaction, especially with opposing viewpoints, above non-engagement. 
  • A dedication to transparency and openness in the decision-making process 
  • Prioritizing the larger benefit of the network above personal gain 
  • Acting at all times as a moral actor who analyzes the ethical ramifications of actions (or inactions) 
  • Not accepting harsh or harmful words, acts, or conduct in our relationships with other token holders. 

On-Chain Governance Mechanisms 

Overall, the “hard” governance approach for Moonbeam will use the Democracy, Council, and Treasury Substrate frame pallets, analogous to how Kusama and Polkadot relay chains are managed. The purpose of these modules is to enable the majority of network tokens to influence the results of crucial network decisions. Moving forward, these decision points take the form of voting on proposed referenda that are weighted by stakes. 

Voting Dynamics

Two criteria are supplied at the moment of voting that defines a token holder’s power in a referendum: lock balance and conviction. Lock balance represents the number of tokens that a user commits to a vote (not to be confused with the user’s account balance). 

Similar to Polkadot’s governance, Moonbeam employs the notion of voluntary locking, which enables token holders to enhance their voting power by locking tokens for a longer length of time. If no lock term is specified, a user’s vote is worth 10% of their lock balance. More voting power may be obtained by expressing a stronger belief. For each additional conviction (vote multiplier), the duration of incarceration is doubled. You may get further information regarding conviction under Vote on a Proposal. 

Furthermore, the technical committee and the council have limited time in blocks for voting on motions. If sufficient votes have already been cast to decide the decision, motions may conclude in fewer blocks. There is a limited number of suggestions that both the technical committee and the council may accept. 

Unanimous consent is required for the technical committee to revoke a proposal before it has been approved. A single technical committee member may reject an incoming council proposal, but only once and only for the duration of the cooling-off period.

Treasury of Moonbeam

Moonbeam Network - Moonbeam Polkadot - Moonbeam Treasury

Moonbeam will feature a community bank account for funding network projects that advance the network. This treasury will be financed by a portion of the network’s transaction fees and controlled by the Council. Each network built on Moonbeam will have its own treasury. Moonbase Alpha TestNet, Moonshadow on Westend, Moonriver on Kusama, and Moonbeam on Polkadot will have separate treasuries. 

A portion of each block’s transaction fees will be assigned to the Treasury to support it. The remaining proportion of fees is incinerated. The Treasury allows stakeholders to submit expenditure ideas for Council scrutiny and voting. These budget proposals should contain measures to expand the network or increase network participation. Some network projects might include financing integrations or partnerships, community events, network outreach, and other activities. 

To discourage spam, proposals must accompany a deposit, commonly referred to as a proposal bond. The proposal bond must exceed the proposal bond minimum, which a governance proposal may alter. Therefore, any token holder with sufficient tokens to pay the required deposit may propose. The extrinsic will fail because of insufficient money if the proposer does not have adequate funds to cover the deposit, although transaction costs will still be deducted. 

After submission, a plan is subject to governance, and the council votes on it. Conversely, the deposit will be forfeited and added to the general fund if the proposal is rejected. If the council approves the request, it enters a queue to be put into a spending period. If the spending queue contains the maximum number of accepted proposals, the submission will fail, similarly to when the proposer’s balance is insufficient. 

Once the proposal has entered the spend time, the money will be disbursed to the recipient, and the initial deposit will be refunded to the proposer. If the Treasury runs out of money, the remaining authorized plans will be stored until the following spending period, when the Treasury will again have sufficient finances.

Is Polkadot EVM Compatible?

Yes, Polkadot is EVM Compatible. Moonbeam makes Polkadot compatible with Ethereum. That’s the idea of the whole Polkadot design. Moonbeam is Polkadot, the power of Polkadot comes from its parachains and the power of the parachains come from Polkadot’s infrastructure.

Bottom Line

Moonbeam being a parachain of Polkadot while also being fully compatible with Ethereum puts it in a unique position to attract many projects. With the Ethereum-compatibility allows developers from other systems to build on Moonbeam in an environment that they are familiar with. Moreover, being a parachain of Polkadot will enable these projects to integrate and benefit from the technology built by other parachains in a seamless way. Although Moonbeam is live for a very short amount of time, we should expect the network to grow into a healthy ecosystem.

Aris Ioannou
Aris Ioannouhttps://coinavalon.io
Aris created Coinavalon with the purpose of helping the average person navigate the decentralized web. Aris has been passively in the space since 2017 and full time since late 2020. Before Coinavalon, Aris worked as a Business & IT Architect in the financial services sector. Aris holds an MSc in Advanced Computing from Imperial College London, a BSc in Computer Engineering from University of Cyprus and currently pursuing an MBA degree from CIIM.

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