Polkadot and Kusama maintain a limited number of parachain slots on their blockchains. Parachains on blockchains can hold and lock KSM using the method of crowdloans. Many projects have gathered KSM by launching crowdloan campaigns to secure the parachain slot. Users have locked KSM tokens in the crowdloan module for the duration of the lease, and the locked KSM tokens will be returned to users when the lease period ends.
Projects wishing to own the parachain slot can use a built-in Kusama crowdloan mechanism where users interested in the slot can contribute to the project by locking their KSM tokens for the duration of the lease. Crowdloan campaigns are launched in a unique way and the funds collected are managed with the logic of the crowdloan module. Accounts to control and secure funds are secure and created specifically for the crowdloan campaign. No project or anyone can access these accounts or control the funds until the end of the rental period or during the campaign period.
How to Participate in a Crowdloan?
Those wishing to participate in a Kusama crowdloan campaign must have KSM tokens on their balance. These tokens must not be staked or locked for governance. With your available KSMs, you can contribute to the crowdloan created for parachain. Minimum crowdloan participation is 0.1 KSM per address. Each user can contribute to the campaign unlimited times. KSMs locked for crowdloan cannot be withdrawn during the rental period and will be automatically returned to the user's account when the rental period expires.
This innovative approach is a way projects can raise funds to win the parachain slot auction. The security of the funds is provided by the relay chain. There is a 48-week parachain rental period. With Kusama explorer, you can easily check your contribution to your crowdloan module. The process of supporting a project to win the parachain slot auction is a very transparent and simple process.
Top Projects on Kusama Blockchain
Polkadot and Kusama networks continue to include very good projects in their networks through parachain auctions. Let's take a look at these projects as Kusama hosts many very good projects on its network.
Crust Shadow (CSM)
Crust Shadow is a decentralized Web3 cloud storage protocol. It aims to create the decentralized cloud system of Web 3.0 with its architecture that has a decentralized computing layer and multiple storage layers supporting IPFS. Crust Shadow, whose interface is similar to Amazon S3, provides decentralization with its distributed file system.
The developers of the project aim to achieve the highest performance at a low cost. Thanks to the DSM (Decentralized Storage Market) created for users, users can order storage within the network.
Khala (K-PHA)
Khala is the front mainnet of Phala in the Polkadot network. It is the Kusama blockchain version of Phala, which is traded on the Polkadot blockchain as a parachain to serve DeFi and blockchains. Khala and Phala will perform the same tasks on two sister blockchains. Khala Network's native token is K-PHA and can be exchanged for PHA at a ratio of 1:1 if desired.
Encointer
Encointer is a project that aims to fundamentally redesign money and spending habits. Every user is made to have a universal basic income and digital identity without relying on a central authority. These two features are based on the principle of equal opportunity.
Polkasmith (PKS)
PolkaSmith was developed to be used as a one-stop production platform for building unlimited NFT and DeFi applications. Polkadot network is not famous for DeFi and NFT applications, so this network definitely needs projects like PolkaSmith. When the project participated in the Kusama parachain auction, it gave support users 350 PKS per 1 KSM, giving them a unique opportunity to participate in the Red Kite IDOs. Red Kite is a popular launchpad platform.
Conclusion
Crowdloan campaigns in Kusama continue quite successfully. As the Kusama parachain slots are put up for auction, many projects provide a high return on investment for participants. Some projects even offered a reward of $4,000 per KSM contributed, offering a great return on investment for investors. If you understand the crowdloan logic, you can participate in parachain auctions in both Polkadot and Kusama and earn rewards by contributing to projects.
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