Polkastarter: Fundamental Analysis

The success of Decentralized Finance solutions comes with a number of great challenges. Among many other challenges, scalability comes at the top. With Ethereum network fees skyrocketing and scalability issues leading to slow platform performances, it leaves users frustrated and looking for other ways that are cheap and smooth.

As the demand for cheaper, user-friendly, and secure transactions rises, it can be seen that the future of DeFi won’t be tied to one chain. This is leading towards an interoperability culture that allows cross-chain token pools and auctions. One such project is Polkastarter which is truly interoperable DeFi based on Polkadot.

What is Polkastarter?

Polkastarter is a cross-chain decentralized exchange (DEX) that facilitates interoperability between different blockchain protocols and allows start-ups to raise funds in a cross-chain token pool and an interoperable environment. Powered by Polkadot, Polkastarter is designed in a way that enables cross-chain interaction of blockchains to aid in raising capital by listing native tokens on the DEX platform. The fundraising is mainly done through dutch auctions and sealed-bid auctions.

Launched on December 15, 2020, Polkastarter is quite new in the field. Since its launch, the platform has been doing great, especially with the sale of its first two liquidity pools in about 30 seconds. For a project this new, it is quite a remarkable achievement.

The reason behind the network’s major strengths is its relevance with Polkadot. Polkadot surpasses Ethereum and other famous decentralized exchanges due to its use of parachains and consensus mechanism that translates into scalability, upgradability, and interoperability.

What Does Polkastarter Offer?

Polkastarter has some amazing features that make it score better than existing decentralized exchanges such as Bounce, Uniswap, and Primablock. For example, unlike Polkastarter, these platforms do not support interoperability among blockchains, nor do they support a wide array of virtual assets. Let's see some of the unique features offered by Polkastarter:

Interoperability:Polkastarter facilitates cross-chain interaction of different blockchains. This interoperability enables easy access to swap tokens belonging to any network, other than Polkastarter. The platform uses sharding technology to build interaction among various blockchain protocols.

Enhanced transaction speed:The platform is powered by the Polkadot network, which has an enhanced speed to process transactions. For this reason, Polkastarter displays a high capacity to process transactions, i.e, 160,000 transactions per second (TPS) which can go as high as a million TPS.

Fixed swaps:The network offers fixed swaps that make up a significant component of the platform. Fixed swaps differ from dynamic swaps in a way that they provide a greater level of transparency on the funds raised during fundraising. Moreover, fixed swaps counteract price volatility, unlike AMM swap pools.

Fixed swaps have a tendency to alleviate the risk of private investors artificially inflating the price. Hence, fixed swap pools make sure there is a fair distribution of tokens among the users while minimizing the risk of rug pulls in a liquidity pool.

Permissionless listings:Polkastarter is a truly decentralized platform based on a permissionless environment. At the Polkastarter platform, anyone is able to use the protocol to create and launch fixed swap token pools in a decentralized manner. Moreover, countermeasures to minimize the malicious pools are also integrated into the system.

Polkastarter Tokenomics

When Polkastarted went live, its native token POLS traded at $0.507413, with a market cap of $18,999,470 and a 24-hour trading volume of $3,819,065. Let's get into the details of Polkastarter tokenomics.

POLS token:Polkastarter's native token is POLS with a total supply of 100 million. Initially, the circulating supply of POLS was nearly 18 million POLS. The token is used for various sections on the platform. At the time of seed sale, Uniswap listing, and private sale almost 42.5 percent of the tokens were sold out. The remaining tokens were distributed among the team, advisors, and foundational reserve.

Token utility:In the Polkastarter ecosystem, POLS acts as a utility token. It is applicable in the Polkastarter network in the following ways:

-Governance:With the help of POLS, token holders can participate in essential decisions regarding product development and network updates through community voting.

-Staking:Users can also stake POLS tokens and get pool rewards in return on various fronts. The rewards are distributed by providing liquidity to the Polkastarter ecosystem.

-Liquidity mining:You can also participate in daily token rewards by taking part in the liquidity mining program. In order to participate in liquidity mining in the first place, stake Polkastarter’s native currency. That is how rewards are distributed to entities that provide liquidity on the secondary markets.

POLS distribution:The POLS token is distributed in the following metrics:

15% for Seed sale.
27.5% for Private sale.
22.5% will be distributed as a liquidity fund which will supply liquidity to other exchanges.
15% is reserved for ecosystem growth which includes awareness, marketing, partnerships, and exchange listings.
10% to the Team and Advisors.
The remaining 10% to the Foundational Reserve.

Funds usage:The funds collected during fundraising will be distributed in the following manner:

45% will be distributed to the developer team.
20% to marketing actions including partnerships, awareness, and go-to-market strategy
5% to legal and accounting.
The remaining 30% to supply liquidity to exchange.

Key Partnerships With Polkastarter

Among many partnerships of Polkastarter with reputable decentralized platforms, only two stand out. These are Polkastarter with Covalent and Polkastarter with DIA. Other partnerships include Moonbean, Orion Protocol, and Shyft.

Polkastarter and Covalent:

Polkastarter has partnered with a platform called Covalent which is capable of fetching intricate details about a crypto wallet. The partnership allows users to check if a token contract is worthy of their trust or not. In this way, among other details, users get access to the token contract age, verification, and transaction volume.

Polkastarter and DIA:

DIA is a Decentralized Information Asset that is responsible for providing distributed oracles on Polkastarter. It is due to DIA's exceptional qualities that helps Polkastarter provide warnings against massive price slippage.

The Takeaway:

Polkastarter is one of the recently launched projects on the Polkadot network that meets the needs of the near-future. The platform adds transparency to the projects while opening doors to distributed governance. As of now, Polkastarter leads the way to provide a platform that sets the bar higher in decentralized funding. The platform has a detailed roadmap and subsequent actions are being taken to implement those plans.

To conclude, Polkastarter still has a long way to go as most of its plans are still in the pipeline. However, with this growth and development, this DeFi project is certainly one of the projects to look forward to in the near future.