Parallel Threads: A Flexible Solution in the Polkadot Ecosystem

Parachain threads are an innovative concept that allows blockchain projects to temporarily participate in the security of the Polkadot network without the need to rent a dedicated parachain slot. This mechanism maximizes economic benefits by sharing parachain slots among multiple competing resources. For projects that cannot obtain a full parachain slot or find it economically unfeasible to acquire one, parachain threads offer an opportunity to participate in Polkadot's shared security, although each executed block requires a corresponding fee. Additionally, it provides a smooth transition option for projects that no longer require a dedicated parachain slot but wish to continue using the relay chain.

Origin of Concepts

The concept of parallel threads can be traced back to similar ideas in resource management of limited memory in personal computers in the late 1980s and early 1990s. At that time, due to limited physical memory, computers created virtual memory by using swap space on the hard disk to extend memory capacity, allowing more processes to run simultaneously, even though some processes might require longer execution times.

Operating Mechanism

In the Polkadot network, some parachain slots will be designated as a parachain thread pool. These slots will not attach to a fixed parachain but will serve as a space for parachains to bid block by block. Organizers will provide bids in DOT to include block candidates with parachain threads. Relay chain block producers can choose to include a block with a parachain thread from these bids, typically opting for the highest-bidding candidate block to maximize returns.

Tokens from parallel thread auctions may be allocated at a ratio of 80-20, with 80% going to the Polkadot treasury and 20% given to block producers. This allocation 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 can present one of three states at different stages of their lifecycle: independent chains (with secure bridging), parachains, or parathreads. The conversion between them is relatively easy, as the main difference lies in the economic model rather than the technical implementation.

Parallel threads enjoy the same advantages as full parallel chains when it comes to 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 a parallel chain and a parallel thread lies in their economic models. A parallel chain needs to be registered through governance proposals or slot auctions, while a parallel thread has a fixed registration fee, which is usually much lower than the cost of obtaining a parallel chain slot. The deposit for a parallel thread is refunded after its term ends.

It is important to note that registering a parallel thread does not guarantee that it will be continuously included in the relay chain. Whenever a parallel thread needs to generate a new block, it must participate in an auction to compete for inclusion in the verification of the next relay chain block. This mechanism is similar to the transaction fee market in Bitcoin or Ethereum, where busy periods may drive up the price of inclusion for parallel threads.

Economic Model of Parallel Threads

The organizer's income mainly comes from two aspects:

1. Transaction fees in the local token system of parallel threads. If a parallel thread does not have a valuable local token, it can use DOT to incentivize the 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 interval time at which the parallel thread blocks are incorporated into the relay chain.

Although organizers can accept payments in local parallel thread currencies, on the relay chain, they must submit bids for block candidates in DOT.

Parallel Chain Slot Conversion

Parachains have the opportunity to convert their slots into parathreads and vice versa. This provides a graceful transition option for parachains that have reached their lease period and do not have sufficient funds to renew. They can remain registered on the relay chain and only generate new blocks when necessary.

This flexibility helps mitigate the sudden interruptions that may arise from the expiration of parallel chain slots. Even if renting full parallel chain slots is no longer economically viable, projects can still continue to operate within the Polkadot ecosystem.