Polkadot’s parachains launch is expected to begin once two things have happened: 1. A full external audit is completed. 2. Kusama Network executes at least one successful auction involving crowdloans and hosting at least one functional parachain.

What are Parachains? Parachains are the diverse individual layer-1 blockchains that run in parallel within the Polkadot ecosystem (on both the Polkadot and Kusama Networks). Connected to and secured by the central Relay Chain, parachains share and benefit from the security, scalability, interoperability and governance of Polkadot.

The path to launching a parachain on Kusama will differ from team to team, but a typical process could look something like this: Design a parachain and build it using substrate.  Test and optimize locally than on a testnet like Rococo.  Determine a slot lease auction strategy.  Join an auction and bid away.  Deploy on the acquired slot after the start of the lease period. Renew at the end of the lease period by joining another auction.

What is an external audit? Polkadot has been entering the fourth and final phase of its mainnet launch, which involves deploying parachains to the Kusama network. According to a blog post by Gavin Wood, Parity Technologies, had released an upgrade — Polkadot version 0.9 — for Kusama, which “is now finally ready to host parachains.

Before the launch of Parachains there will be a full external audit on the new version of Polkadot and Kusama.

What is a Kusama Network? Kusama is a scalable multi-chain network for radical innovation and early stage Polkadot deployments.

What is the Successful Auction on Crowd Loans? After the launch of Polkadot, Kusama will execute “at least one successful auction involving crowdloans and hosting at least one functional parachain.”

After Kusama’s first auctions complete successfully, one would expect Polkadot’s auctions to happen soon after,” said Wood. Following the auction, Kusama website will announce the first of five auctions one week in advance.

Parachain slot auctions follow a modified candle auction format, where the exact endpoint of the auction is unknown by participants in order to prevent auction sniping (the strategy of bidding at the last moment) for more accurate price discovery. 

Acquiring a parachain slot is important to ensure guaranteed block inclusion at ever Relay block for a particular parachain.

Parachain slots get sold by way of unpermissioned candle auction. Candle auctions are different from open auctions.  Candle auction is a variant of open auctions. In the candle auction, the highest bidder will be considered the winner.

Online candle auctions make use of random numbers to decide the moment of termination of the auction process. However, Parachain slot auctions will not use termination of the auction process, rather they will follow “open phase” and the auction will be retroactively determined and the normal close will be done considering that the auction has ended at some point in the past.

So, in an open phase online candle auction, the bids will continue to be accepted; however, the close moment will be retroactively determined.  Thus, the close moment can precede the bid moment.

What is a Functional Parachain?  Technically, the launch of Polkadot began around ten months ago with the first four phases; the last round is a move to complete decentralization and permissionlessness.  This happened finally at the end of July last year. Now, phase five, the final phase in the launch of Polkadot is set to begin.  When this is over we will have a fully functional parachain.