Accelerating Blockchain Evolution: Tanssi - Pioneering the Next Phase of Appchain Deployment

New Narrative in Web3: the Rise of AppChains

The user growth and mass adoption of blockchain applications has put tremendous pressure and issues on Ethereum and other public blockchain infrastructures in terms of performance and user experience. More importantly, with the rise of Web3 and the concept of interoperability, dApps are creating more demand for flexible scaling and customizability, which are beyond the technical capabilities that a sole blockchain can do.

So, it’s not a secret that dApps are looking for a more customizable solution. One emerging business model is to build application-specific blockchains, called AppChains, that are defined as single-use case blockchains that dedicate their blockspace to a specific application. Applications that build AppChains can customize multiple layers of their stack, such as their security model, fee token, and write permissions, among others.

AppChains are not really a new concept, as Bitcoin can be seen as an application-specific blockchain for digital gold, while Arweave can be used for permanent storage. Quite a few crypto builders have chosen the AppChain in order to support specific use cases and meet specific requirements.

Axie Infinity launched the Ethereum sidechain Ronin in 2021; DeFi Kingdoms announced a move from Harmony to the Avalanche subnet; Nearly 46% of Apecoin community members voted to build ApeChain; And dYdX, the largest Derivatives DEX, announced plans to develop a standalone blockchain in June 2022, moving away from StarkWare to its own Cosmos-based blockchain.

Moonbeam, known for its dev-friendliness, also started to focus on AppChains in the second half of 2022. Derek Yoo, founder of Moonbeam, believes that moving from dApps to customized AppChains is a viable way to achieve business scale from 1 to 100.

There is no doubt that AppChains have become a promising beacon of new growth. However, the current deployment of AppChains still has stubborn challenges such as high cost, long lead time and technical complexity. The surge in demand for AppChains deployments is forcing changes and innovations in the related infrastructure.

Moondance Labs (most of them are original contributors to Moonbeam) is making such a significant attempt by building an AppChain infrastructure called Tanssi Network, which aims to build a bridge between developers and the AppChain development ecosystem. This initiative has quickly been recognized by developers in Polkadot & Substrate as well as well-known investment institutions, and Tanssi has successfully closed its seed funding round this month and plans to release testnet later this year, with the main network expected to go live in 2024.

How Does Tanssi Offer an Easy and Dev-Friendly AppChain Deployment Solution

Tanssi is an AppChain infrastructure protocol that simplifies AppChain deployment, making it secure, efficient, and easy while eliminating the time-consuming and complicated process of traditional blockchain implementation.

Tanssi is a permissionless protocol interacting with parachains within the Polkadot ecosystem. As the image below shows, these linked parachains, known as ContainerChains in the Tanssi context, gain access to an array of tools and services. This selection encompasses essential components such as block production, data availability, cross-chain messaging, and bridges to external networks.

The protocol extends further functionalities to ContainerChains, including management tools and templates. Key integrations like wallets, indexers, RPC endpoints, block explorers, and oracles are also part of the package. To ensure effective use of relay block space resources, ContainerChains operate not as children, but as siblings to Tanssi. This structure strengthens the efficiency and adaptability of the Tanssi protocol.

Additionally, ContainerChains are connected to Polkadot’s relaychain, benefiting from the advantages of Polkadot’s shared security and native interoperability.

Tanssi’s overall architectural design makes it a well-established AppChain infrastructure protocol that provides a viable solution to many of the key challenges of traditional blockchain deployment. This is demonstrated by the following：

• Complex Infrastructure Management

Tanssi eliminates the time-consuming and resource-draining task of managing various infrastructure components by offering a set of customizable tools and resources available as-a-service.

• Security

Tanssi ensures robust security and aliveness by leveraging both Polkadot’s shared security architecture and Tanssi’s shared collator set. Developers can customize the implementation of their AppChain Container to meet their unique security needs.

• Customization

Tanssi, built on the Rust-based Substrate framework, offers high performance, flexibility, and a library of pre-built pallets for rapid development. Substrate’s modular architecture facilitates easy customization.

• Cost and Efficiency

Tanssi’s dev-friendly protocol reduces capital requirements by providing a more efficient and less resource-intensive process for launching and maintaining an appchain. Tanssi enables appchains to be deployed in less than an hour, a significant improvement compared to the usual months.

The combined advantages of Tanssi pave the way for a smoother transition from concept to deployment. This efficiency allows developers to invest their efforts into building superior user experiences, expanding their ecosystem, and ensuring a quicker time to market. All things considered, these benefits offer a significant improvement over the current possibilities for appchain builders.

Prominent Promoters,Backers and Early Ecosystem Partners

The Tanssi protocol, currently in development by the seasoned blockchain professionals at Moondance Labs, is directed by Francisco Agosti, known for his significant contributions to Moonbeam’s ecosystem. Key team members, Gorka Irazoqui and Katherine Quilca, both pivotal in Moonbeam’s growth, are also contributing their expertise. Gorka, who has led important XCM initiatives, and Katherine, who has played a major role in expanding the Moonbeam community, are now applying their collective experience to Tanssi. Their focus is on a critical issue, aiming to broaden the Polkadot ecosystem’s reach to a larger number of developers.

Moondance Labs is doing something that has been recognized and supported by a number of high profile institutions. On May 23rd, Moondance announced that it had successfully closed a $3 million seed funding round. The round was led by leading digital asset manager Arrington Capital, with participation from Jsquare, Borderless Capital, HashKey Capital, D1 Ventures, Hypersphere and C² Ventures, and the funds will be used to drive Tanssi Network’s growth.

Despite its recent start, Tanssi Network has already established partnerships with some prominent Web3 projects, such as Kawa (a cross-chain lending protocol), RMRK (a modular NFT protocol), and Zenlink (a cross-chain DEX protocol) joining Tanssi Network’s early ecosystem. To drive more high-profile projects to join this exciting experiment, Moondance Labs has launched the Tanssi Ecosystem Pioneers program,which aims to foster a vibrant community of builders and enhance their interactions with the Tanssi protocol.

Our Longer-term View on AppChains in Web3

Tanssi’s work has significant implications for driving AppChains at scale. By simplifying the path to AppChain deployment, it liberates developers from the intricate maze of infrastructure management. The emergence and rise of AppChain solutions has had a profound impact on the entire Web3 infrastructure landscape.

The flexibility and power of AppChains make them a game changer moving forward, and arguably the next step for dApps will be AppChains.The limitations of using public blockchains as the base layer for dApps are expected to be mitigated with AppChains. With blazing-fast and low-cost transactions, high performance dApps built on appchains will provide users with an unprecedented Web3 experience.

In the long run, AppChains will bring about a fundamental paradigm shift in the relationship between “chains” and “apps”: from a supply-driven model to a demand-driven model. Whereas before, the design of the underlying chain determined the design of the upper apps, now the opposite is true: the design of the apps will determine the design of the chain. The maturity and ease of deployment of custom AppChains will transform the Web3 infrastructure space into an application-first and user-first experience,which is actually a sign of Web3’s growing maturity.

About DFG

Digital Finance Group (DFG) is a global blockchain and cryptocurrency investment firm founded in 2015 with assets under management of over $1 billion. Through a wide range of sectors within the blockchain ecosystem such as Web3.0, CeFi, DeFi, NFTs, the Polkadot ecosystem.

Investments include Circle, Ledger, Coinlist, FV Bank, Astar, ChainSafe and over 100 more. DFG intends to create value, through analytical research, based on the most impactful and promising global blockchain and Web3.0 projects that will bring a paradigm shift to the world.

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