Last updated: July 6th, 2021 12:25 PM CDT
Shiden is the sister network of Astar (previously known as Plasm), both of which offer smart contract platforms for the Kusama and Polkadot relay chains. Shiden will allow a variety of smart apps to be implemented on the Kusama relay; defi, NFTs, staking applications, and whatever else is possible in the world of decentralized applications. Their platform facilitates the integration of multiple chains and will be Ethereum compatible on day 1. The project has a working testnet and is well prepared for Kusama’s first parachain auction.
One particular feature of Shiden that sets it apart from other smart contract platforms is having the ability to trade dApps in a decentralized manner. The Astar network has a built-in “operator trading” portal where smart contract ownership can be exchanged from person to person. The reason Shiden is able to do this is because smart contracts deployed on the network can be nominated where nominators and operators get rewarded. This proof-of-stake configuration regulates which smart contracts are viable and allows for the transfer of ownership of a smart contract or, more accurately, the rights to operate and reap rewards from said smart contract on the Shiden network.
Instead of attempting to build applications for Kusama, Shiden strives to be a hub where developers can convert existing blockchain applications into Kusama’s relay chain. The development possibilities that Shiden will facilitate are endless and will bring a wealth of dApps to Kusama.
The SDN Token
Shiden’s native token has a few uses including two unique ways to stake it: network staking and dApp staking. With the former, token holders can stake toward validators that write the blocks for the Shiden parachain. Rewards from this type of staking are based on validator rewards and help secure the integrity of the Shiden blockchain. DApp staking allows SDN holders to nominate applications they see fit for the network; rewards are generated by the operation of smart contracts within these applications. This type of staking, which is unique to Shiden/Astar, ensures applications are trusted and supported by a democracy of funds. It also serves as a grant mechanism to help projects get off the ground.
The SDN has other more conventional uses as well. Token holders can participate in governance and pay transaction fees with SDN like any typical cryptocurrency ecosystem. SDN can also be used as a deposit for developers to built layer 2 applications on the network. Essentially what this means is that developers can deposit SDN to create applications hinged on staked smart contracts. The reason this is so valuable is because layer 2 dApps do not need to be facilitated on-chain which means they can offer off-chain privacy and speed.
Shiden will be minting 70,000,000 SDN, 65% of which will be distributed to the community making it a community driven technology. They will be lock-dropping 30% of the total supply to PLM holders and 30% to crowdloan participants, that way Astar supporters and Kusama holders will have equal power over the ecosystem. However, the 30% designated for crowdloaners will be split: 22% for the first auction and 8% for the second auction. For the purpose of this article, I will only consider their first auction offering.
The Crowdloan Reward
- 22% of total supply (15,400,000 SDN)
- SDN:KSM ratio (TBD)
- 1 month lock then 10 months vesting
- 48 week long lease
Shiden has a number of conflicting publications about their parachain crowdloan offer but I have referenced what appears to be the most recent and accurate publication. The whole of the SDN reward will be disbursed 1 month after winning the slot, but they will not be transferable. After the SDN is unlocked crowdloan participants will be able to use SDN within their ecosystem until they become fully vested 10 months later.
Shiden also offers a bonus plan which is funded by 2% out of the 22% PLO (parachain lease offering). The specific details of this bonus is yet to be determined but here is a graphic to give you an idea of the tiers:
Let’s examine some outcomes and trade-offs not including the 2% bonus program:
Again, these are just examples and do not indicate how the prices will change.
Astar is a proven network with robust documentation and a fully functioning testnet. The team has integrated important technologies like Chainlink, Coinversation, and Automata to Astar which is very promising for its soon to be cousin network Shiden. I am personally impressed with the project and their publications so I am giving it a low risk evaluation.
22% of the total SDN supply is a generous proportion and the fact that these SDN will be available to use just 1 month after winning the slot makes me give this a medium reward rating.
While a smart contract platform is not by any means a new idea for a Kusama parachain, some of the quirks of Shiden definitely sets it apart. Their toolset allows different blockchain-native smart contracts to be implemented on Kusama’s relay chain and their ecosystem enables the ownership of these applications to be traded and voted on by nominators. The latter function is something I have not seen in any other smart contract platform making Shiden a novel place to build and manage dApps.
There are endless possibilities behind any smart contract platform and Shiden offers nothing less than that. There is great utility in a platform that facilitates the conversion of existing decentralized smart contracts for use on Kusama’s relay chain.