# The new play of Staking + DeFi | How to combine liquidity with high rewards.
Host: Hello everyone, and welcome to the first online AMA of Bifrost. I'm host Bonnie~
After five months of development preparation, Bifrost gradually entered the public vision. It from the initial concept to today's test network, constantly bring everyone surprises. In the first AMA, Lurpis, co-founder & core developer of Bifrost, will take the wonderful world of Bifrost to you. This session is divided into two parts, the host questions and the audience free questions.
Host: firstly, let's welcome Lurpis to make a brief introduction to Bifrost.
Hello everyone, I'm Lurpis from Bifrost and I'm here to share about Bifrost.
Bifrost is a cross-chain network, which can provide Staking liquidity. Users can exchange PoS Token into Bifrost vToken by Bifrost transfer bridge at any time to get Staking income and liquidity. For example, users can exchange EOS into vEOS. At the same time, they can receive the income from EOS Staking, also sell vEOS and redeem EOS at any time. Also, VEOS can be used in DeFi, Dapp, DEX and other scenarios. For example, when using vEOS as collateral for lending, the income from Staking can pay part of the interest and realize low-interest lending. There are other extremely good parachains projects in the Polkadot ecology, such as Acala network, which committed to stablecoin in the Polkadot ecology, and Darwin network, which focus on game ecology. All of they are possible extensions of vToken usage scenarios.
2. Host: so, what role does vToken play in staking? How does it provide liquidity for Staking?
First, vToken is a sort of general token used to provide Staking liquidity. Take KSM for example, when the user votes directly to the node the KSM in the nomination state will be locked. If you want to sell the KSM, you need to wait at least 7 days of redemption. If a short-term collapse occurs during the redemption period, users can do nothing but watch their assets depreciate. But through the Bifrost Staking, user can obtain vKSM according to the exchange rate. When the market short-term collapsed, vKSM can be sold directly. In addition, vKSM can also transfer, trade, use it in Dapp at will, even use it as security in DeFi, or lend it to others for the double benefit of Staking and lending.
3. Host: Got it. Simply speaking, the original token can continue to accept the income from Staking, while the replaced vToken can replace the original token to continue to participate in the market behavior for trading or investment. So how do we get vToken? Which channels do we get it?
There are basically two ways to get vToken
1、Bifrost exchange contract, Token can converted into vToken directly according to the exchange rate at that time. 2、Because vToken is a general assets agreement that can be traded on the market, users can buy vToken directly in the crypotcurrency exchange, also can receive the income from Staking. Besides, in order to reduce the threshold, we will also provide functions similar to swap. Bifrost-App is expected to be launched as a test version on April 15. Users can receive KSM and DOT test Tokens of Bifrost test network from Telegram BOT, and then experience the exchange, trading and revenue functions in Bifrost-App.
4. Host: After knowing the way of vToken acquisition, can you tell us about the benefits of vToken? Where does the revenue come from? Where will it be valuable?
In terms of benefits, also divided into two parts, the first part guaranteed income depends on the Staking rules of the public blockchain, such as the KSM currently nominated annualised rate of 20%, then vKSM will be at least 20% annualized returns. The second part of the proceeds come from bidding on the voting right of Bifrost Staking Pool, different nodes are willing to pay a higher premium for nomination, then corresponds to the user's Staking gains even beyond KSM.
Meanwhile, the nomination bidding of Bifrost Staking Pool will give small nodes with good service but few votes a chance to compete with super nodes, making PoS network more decentralized and safer.
5. After listening to your explanation of vToken, I think vToken does bring better liquidity to Staking, and I also hope vToken can be used in more scenarios. As mentioned earlier, Bifrost is a parachains of Polkadot, and can you talk a little bit about what parachains is?
Parachains is applications of Polkadot relay network, independent of each other is business chain. But different from other common public blockchain, data can be exchanged between parachains. There is a special kind of parachains called transfer bridge. The function of the transfer bridge is to connect other blockchain bridges into the Polkadot network, so that the parachains and other public chains can also achieve interoperability. Just like the EOS transfer bridge Bifrost is developing, we hope to transfer EOS into Polkadot ecology. User both can get liquidity of EOS Staking, and let EOS users experience other parachains applications in Polkadot ecology.
6. Host: I see. Recently, we have seen some friends who have been looking forward to the launch of the mainnet of Polkadot. Can you tell us a little bit about the launch of the mainnet of Polkadot?
It is expected that the launch of the mainnet of Polkadot in 2020 in June, but before this, Kusama had been released as beta network, which is an open network that development time fast Polkadot four times. Independent of Polkadot, Ksm will permanent run, the vast majority of Polkadot logic can be verified on the Kusama, teams who want to be part of the Polkadot ecological, starting from the Kusama is a good choice. Bifrost will access to Kusama network before access to Polkadot and will also support vKSM exchange.
7. Host: Seventh, I would like to ask Lurpis to give us a brief introduction to the process of slot auction before the launch of the mainnet of Polkadot. What efforts has Bifrost made?
Once the Polkadot mainnet is online, it is expected to open up parachain slots auction, which will be held every six months. As far as we know, there won't be many slots to begin with. Parachain teams that need slots will have to lock in the DOT to bid on the 6 - 24 months usage of the slots. At the same time Bifrost will open its (Initial Parachain Offer) IPO before the parachain auction. If you hold DOTs you can participate in this IPO, and if Bifrost is successful in the auction of Parachain slots, then you will receive a generous BNCs as return. DOTs that also participate in the IPO are not consumed, but are locked in the parachain slot. The duration of the lockup depends on how long the parachain slot is used. After the parachain slot expires, you get your DOT back, and all you lose by participating in the IPO is the cost of DOT Staking time and the opportunity cost of holding the DOT.
8.Host: We all know that Bifrost was funded by the WEB3 Foundation not long ago. Can we talk a little bit about the current cooperation with WEB3 and Polkadot?
Bifrost, as the first Substrate Hackathon award-winning project, first appeared in the public view, and is also as a Grant project funded by Web3 Foundation. Besides, Bifrost needs to use the relay network of Substrate and Polkadot to complete the business logic, its ecological coordination with Polkadot is relatively close. Of course, Bifrost as a parachain in Polkadot, the first to be supported will also be vToken for Polkadot-related assets such as vDOT and vKSM, and we are happy to cooperate if there is a need for Staking liquidity in other parachain.
9. Host: After hearing your ideas, we are looking forward to the development of Bifrost. Could you tell us something about the current progress of the Bifrost project?
Bifrost released POC-2 Testnet on March 21, 2020. The node number reached 25 in one week, distributed in the whole world. In the POC-2 test network, we verified a series of logic such as bifrost-Node block stability, POA governance, vToken exchange rate adjustment and so on. Meanwhile, we started to build user communities and establish market cooperation.
10. Host: last question, what is the roadmap of Bifrost's future?
In the next time we will continue to improve the POC - 2 testnet development work, and plan to enter EOS Jungle test network into Bifrost test network. And it is planned that the Bifrost Asgard Pre-production network will be officially launched on May 1st, which will similar to the Kusama that will be permanently open as a Chaos network. Teams who want to participate in Bifrost，can validate the business logic in advance in the Bifrost Asgard network. On May 30, we plan to conduct IPO preview on Kusama network to test the entire IPO process of Bifrost. It is expected that on June 30, Bifrost will become Kusama Parachain and provide real KSM exchange. In short, we will try to keep the rhythm of Bifrost's mainnet launching with that of Polkadot's main network, and strive to be the first parachain to access Polkadot's main network.