Why was Moonbeam needed?
High transaction fees have troubled crypto traders for the longest time. Many attempts are underway to reduce the transaction fee and make crypto trading more acceptable and user-friendly for all.
The future of blockchain technology was clearly to facilitate efficient interoperability between networks.
The purpose of interoperability was to increase productivity by allowing access to different blockchains simultaneously. It was also needed to fulfil the crux of decentralisation: complete transparency.
Simply put, just like the process of transportation requires several factors like the manufacturer, transporter, retailed, and end-consumer to come together to complete the delivery of a package from point A to point B, interoperability between networks would facilitate a smooth flow of transactions on the blockchain.
Picture this – You shop on Amazon and opt to pay via GPay. Amazon automatically opens GPay where you enter your pin and make the payment, without entering any UPI for the transaction. Once the payment is made, the order get placed automatically on Amazon. This is the two apps interacting with each other, facilitating interoperability.
Platforms like Polkadot are one of the leading networks built around the objective of executing blockchain interoperability.
The Polkadot Network is essentially made up of connected blockchains. Each blockchain on the Polkadot Network is called a parachain. Polkadot provides shared security to all the parachains and the ability to communicate with other parachains on the network.
Moonbeam is a parachain connected to Polkadot. Moonbeam positions itself as a bridge between the Polkadot Ecosystem and the Ethereum Ecosystem. Blockchain interoperability, as explained above, is being executed through the Moonbeam Network, which goes beyond the Polkadot supported blockchains to cover other blockchains.
Key features that make Moonbeam popular
When developers create an application on one blockchain, they deploy it through a smart contract. To ensure that the same application can be used on another blockchain, they will have to create a whole new smart contract from scratch. The Moonbeam Network solves this problem. Developers that create applications on the Moonbeam Network will not have to create a different smart contract for it to work on the Ethereum Blockchain.
Another advantage of the Moonbeam Network is that it gives access to use Ethereum-based tools while operating on the Polkadot Network. Therefore, you can link your Metamask wallet and many other tools to Moonbeam.
In addition to being compatible with Ethereum, Moonbeam offers an extension on Ethereum’s base features by including on-chain governance, staking, and cross-chain integration, all of which are Polkadot’s built-in features.
On-chain governance is the base of decentralisation where any proposed changes to the blockchain are first voted on before execution.
Staking involves pledging cryptocurrency that you own to provide liquidity to a network. This means that you keep your currency available for someone else to come whenever they want. Staking helps users earn passive income in the form of interest.
Cross-chain integration is nothing but blockchain interoperability as explained above.
Being a parachain on the Polkadot Network comes with its own advantages like high security, lower gas (transaction) costs and relatively faster transactions.
Adding to the transparency of the network, holders of Moonbean are also are given voting powers to steer the governance of the network.
Moonbeam also contains built-in assets like ERC-20 (the technical standard and benchmark that the best cryptocurrencies follow), DOT and infrastructures like Chainlink and The Graph. It also support Solidity which is the programming language of smart contracts.
Moonbeam’s concept is to the best of both (Polkadot and Ethereum) worlds.
It is extremely easy to build applications on the Moonbeam Network.
Instead of implementing a full parachain, developers can use Moonbeam to build applications on the Polkadot Network.
Moonbeam eliminates the need for complex token economic models, incentivising nodes (similar to paying a third-party for software support), issuance schedules and other concepts needed to launch an independent blockchain.Paying for a parachain can be extremely expensive. Moonbean covers that for you. You can get complete access to the Polkadot Relay Chain (the central chain from which the parachains operate) and enjoy the features through Moonbeam.Upgrading from a smart contract or a Dcentralised Application (dApp) to a full parachain when you need to scale will be a smooth process with Moonbeam.
Moonbeam token as an investment
In November 2021, Moonbeam secured a slot on Polkadot through a crowd loan campaign. With the highest number of contributions, 2 lakh supporters around the world contributed 35 million DOT (~INR 10436 crore) and received 50 million Moonbeam (GLMR) tokens as a reward.
Evidently, Moonbeam has a budding community that is constantly updated about any progress on the Network. The Moonbeam community welcomes application for becoming an ambassador to directly help the community grow. Developers can submit proposals for a Moonbeam grant for their projects as well.
The token has been attracting a lot of attention from investors since its launch in January 2022.
It rose swiftly by almost 4000% only to drop back down just as rapidly, staying 8% above where it started. It also hit an all-time low that any crypto ever has but managed to soar the next day.
Needless to say, any newly launched crypto is extremely volatile, and Moonbeam was no different. Moonbeam has a maximum supply of one billion tokens, of which only around 8.5% are currently in circulation.
Bitcoin gained about 60% in the last year. Experts predict that layer 1 networks, like Moonbeam, could grow faster than Bitcoin in 2022. With Moonbeam already earning the title of being one of the fastest-growing cryptos, its performance is definitely going to be noteworthy this year.
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