System Parachains and the Polkadot Ecosystem: Part 1

Welcome to the first blog post of Dotgraphic! We are excited to start off this journey by diving into System Chains, a crucial part of the Polkadot ecosystem. In this two-part deep dive, we'll try to explain the complexities of system chains, exploring their evolution, requirements, and their role in Polkadot's vision of the decentralized web. The goal of this series is to provide digestible insights into the inner workings of systems chains in the Polkadot ecosystem.

This first part will focus on the origins of system chains, their key differences from parachains, and an in-depth look at the early system chains (previously known as ‘common good chains') that have laid the groundwork for Polkadot's infrastructure. In Part 2, we'll explore the newer additions to the system chain family and peek into the future of what these specialised chains might bring to the Polkadot Network.

Understanding System Chains

System chains are purpose-built parachains that provide core functionality to the entire Polkadot network. Unlike standard parachains, which cater to specific applications or use cases, system chains offer services that benefit the entire ecosystem. They're an integral part of Polkadot's architecture, enhancing its scalability, interoperability, and overall efficiency. Let's delve deeper with an example.

Imagine the Polkadot ecosystem as a big, bustling city. Now, every city needs certain things to run smoothly, like roads, power plants, police stations and other civic amenities. In the Polkadot "city," system chains are kind of like these essential services. They're special Parachains that do the civic jobs for the whole Polkadot network.

A Bit of History

The concept of system chains evolved from the earlier idea of "common good" parachains. This concept - chains that would benefit everyone, not just themselves - was a stepping stone to what we now call system chains. This transition wasn't merely semantic; it represented a shift in how the Polkadot community perceived these chains. The term "system chains" better encapsulates their role as fundamental, network-wide services rather than just beneficial add-ons.

System Chains vs. Regular Parachains

To appreciate what system chains have to offer, it's essential to understand how they differ from standard parachains:

1. Governance: While regular parachains have their own governance mechanisms, system chains are governed directly by Polkadot's on-chain governance. This ensures that decisions about these critical components align with the network's interests.
2. Economic Model: Regular parachains often have their own tokens and incentives. System chains, however, rely on Polkadot’s native token i.e. DOT for transaction fees and network operations.
3. Functionality: Regular parachains typically focus on specific applications or services. System chains, in contrast, provide fundamental infrastructure that supports the entire network.
4. Slot Acquisition: Unlike standard parachains that must win auctions for their slots, system chains are allocated slots through governance decisions, ensuring their continuous operation.

The Early System Chains

Before we go any further, let's dive into the first two system chains that became part of the Polkadot ecosystem.

1. Asset Hub (Also known as Statemint in Polkadot and Statemine in Kusama): Asset Hub serves as a specialised parachain for asset management across the Polkadot ecosystem. Asset Hub functions as both a bank and an art gallery for the Polkadot ecosystem. It supports both fungible and non-fungible tokens, offering several advantages:
   • Reduced operational costs for asset management
   • Standardised asset handling across the network
   • Enhanced security for asset transactions

Why is Asset Hub not a standard parachain? Asset management is a core function that benefits from network-wide standardisation and governance oversight, making it ideal as a system chain.

1. Bridge Hub: Bridge Hub facilitates interoperability between Polkadot and external blockchain networks. Think of it this way, if Polkadot is a city, Bridge Hub is like its airport or seaport. It helps Polkadot connect with other blockchain "cities." Here are some features of Bridge Hub:
   • Standardised bridging protocols
   • Enhanced security for cross-chain transactions
   • Scalable architecture to support multiple bridges

Why is Bridge Hub not a standard chain? As a system chain, Bridge Hub can maintain consistent security standards and protocols across all bridging operations, which would be challenging to achieve with independent parachain bridges.

Evolution with Governance

System chains strengthen Polkadot and enhance its utility. They handle important jobs so other chains can focus on other important blockchain requirements. System chains are also subject to Polkadot's on-chain governance, allowing for network-wide decision-making on their development and upgrades. This collective approach ensures that these critical components evolve in line with the needs of the entire ecosystem.

Looking into the future

The integration of system chains in the Polkadot ecosystem marks a significant step in Polkadot's evolution, providing a foundation for the network's core functionalities. As the ecosystem grows, we can expect more specialised system chains to address additional fundamental network requirements.

In our next article, we'll explore these newer system chains in the Polkadot's system chain family, including the Collectives Chain, the People Chain and Staking Chain (currently proposed). We'll examine how these newer chains further enhance Polkadot's capabilities and support its vision of a decentralized web. Stay tuned for the next article in this series.

[Link to the second article in the series]

We hope this overview has provided you with a better understanding of system chains and their role in Polkadot. As always, we encourage you to dive deeper into the technical documentation and community discussions to fully grasp the intricacies of this innovative approach to blockchain infrastructure. You can read more about system chains on Polkadot official documentation here