Parallel Thread: The Flexible Participation Model of the Polkadot Ecosystem

Parallel threads are an innovative concept that allows blockchain projects to participate in the security of the Polkadot network in a more flexible manner. It does not require renting dedicated parachain slots but instead utilizes these scarce resources through an economically shared approach. This provides an opportunity for projects that cannot obtain a full parachain slot or consider acquiring a slot economically unfeasible to participate in Polkadot's shared security. At the same time, it offers a smooth transition option for parachains that no longer require dedicated slots but wish to continue using the relay chain.

Origin of the Concept

This innovative idea originates from memory management technology in the personal computer field in the late 1980s and early 1990s. At that time, due to limited physical memory, computer systems expanded the available memory space by creating virtual memory on the hard drive. This method allowed more processes to run simultaneously, although some operations might take longer to execute.

Operating Mechanism

In the Polkadot network, some parachain slots will be designated for a parallel thread pool. These slots will not be attached to a specific parachain but will serve as a competitive space for parallel threads to bid for the inclusion of their candidate blocks through the auction of fees for each block.

The organizer will submit bids in DOT to include block candidates with parallel threads. Relay chain block producers can choose which parallel thread blocks to include from these bids. Clearly, they will tend to accept the highest bidding candidate blocks to maximize their own profits. Tokens from parallel thread bids may be distributed in an 80-20 ratio, where 80% goes to the Polkadot treasury and 20% is given to the block producers. This distribution ratio, like many other parameters in Polkadot, can be adjusted through governance mechanisms.

Comparison of Parachains and Parathreads

From a technical perspective, parachains and parathreads are very similar. Chains developed using Substrate may present three states at different stages of their lifecycle: independent chains (with secure bridging), parachains, or parathreads. The transitions between these states are relatively easy, as their differences are mainly reflected in the economic aspect rather than the technical aspect.

Parallel threads enjoy the same advantages as full parallel chains in connecting to Polkadot. They can communicate with other parallel chains or parallel threads through XCMP and are fully economically secured by the set of Polkadot validators.

The main difference between parachains and parathreads lies in their economic models. Parachains need to be registered through the conventional methods of Polkadot (such as governance proposals or slot auctions). In contrast, the registration fee for parathreads is fixed and significantly lower than the cost of obtaining a parachain slot. Similar to how DOT is locked during parachain slot auctions, the deposit for parathreads will also be refunded after its term ends.

It is worth noting that registering a parallel thread does not guarantee continuous block production. When a parallel thread needs to generate a new block, it must participate in the auction for each block in order to compete for inclusion in the next relay chain block for validation. All registered parallel threads are competing for this opportunity.

Economic Model of Parallel Threads

The organizer's rewards mainly come from two channels:

1. Transaction fees in the local token system of parallel threads. If a parallel thread has no local tokens or its tokens lack value, DOT can be used to incentivize organizers.

2. Parallel Thread Protocol Subsidy. Parallel threads can mint new tokens, providing additional incentives for organizers. The number of minted tokens is usually proportional to the block production interval. This mechanism can be implemented through local currency inflation or a treasury-like fund reserve.

Although organizers can accept local parallel thread tokens as payment, transactions on the relay chain still need to use DOT. Therefore, organizers must attach the corresponding DOT bid when submitting block candidates.

Parachain Slot Conversion Mechanism

Projects with parallel chain slots can choose to convert them into parallel threads, and vice versa. This provides an elegant exit strategy for parallel chains that have reached their rental period and lack sufficient funds for renewal. They can remain registered on the relay chain and only generate new blocks when necessary.

This mechanism effectively alleviates the sudden interruptions caused by the expiration of parachain slots, allowing these projects to continue functioning within the Polkadot ecosystem even when renting a full slot is no longer economically viable.