*obligatory not financial advice*
What is Moonbeam?
Moonbeam is a smart contract blockchain that is very compatible with Ethereum, which allows developers on Ethereum to launch their dApps on Moonbeam with only minimal changes. The blockchain is a parachain in the Polkadot network, which makes the chain highly interoperable with other blockchains that are connected to the Polkadot relay chain.
Polkadot is a network that connects several different layer 1 blockchains with each other, so that it’s very easy to bridge tokens and data between each other. Polkadot has a main chain, or relay chain, with open slots where different side chains, or parachains, can connect with each other if they stake enough DOT coins to get a spot. Parachains have only recently started to launch and connect to the relay chain and Moonbeam is one of them.
Moonbeam is one of the most anticipated parachains and brings smart contracts to the Polkadot network. That is because it’s very easy for developers that are familiar with Ethereum to start working on Moonbeam. They can deploy existing smart contracts written in Solidity with only minimal changes and they can use the same tools and integrations they already use. It’s essentially a gate-away for developers and many of their dApps to join the Polkadot network, where their users can also use the resources of other parachains.
Moonbeam uses delegated proof of stake to achieve its consensus. In the Polkadot network, the different parachains process their transactions and collect them in "proofs" that are then going to validators on the relay chain, which gives all the different shards shared security and finality.
Moonbeam has an older sister chain called Moonriver, that is almost identical but it is a parachain in the Kusama network, which allowed the developers to battle test their blockchain before launching it on Polkadot. There is also third chain called Moonrock that is used as testnet for both Moonbeam and Moonriver.
Because Moonriver has already attracted many projects and Moonbeam is compatible with the EVM, there already are quite a few dApps running Moonbeam. There are multiple DEXes, NFT marketplaces and a stablecoin lending protocol. Some projects that are native on other chains have also started to launch on Moonbeam, like Curve and Beefy Finance for example. The developers of the SushiSwap DEX have also shown interest in the blockchain since before its launch and have brought Sushi to Moonriver and could also move to Moonbeam in the near future. Thanks to Polkadots interoperability, Moonbeam and the different parachains can also profit from each other’s applications and utilities.
The GLMR coin
Glimmer or GLMR is the native cryptocurrency of Moonbeam. It is used to pay for transaction fees, for on-chain governance and staking and for incentives. To stay connected to the Polkadot network, the parachains need to rent their slots by staking DOT coins, that’s why Moonbeam is distributing GLMR to its DOT stakers.
There is a max supply of 10 million coins and there is a 5% annual inflation until the max supply is reached in late 2025. At the genesis there was a supply of 1 million, 41% was sold to investors in multiple different sales, 9.8% were distributed to community members in a spezial community event, 3.5% are used for parachain bonding to incentivize DOT staking, 0.5% went to the treasury that is controlled by GLMR holders, 5.3% went to early validators and partners, 14.6% went to the employees of the Moonbeam Foundation and 25.3% went to the Moonbeam Foundation to build the ecosystem and its adoption further.
Of the 5% annual inflation until the max supply is reached, 1% goes to validators on Moonbeam, 1.5% is used for parachain bonding and the remaining 2.5% are going to the users that stake their GLMR coins. The transaction fees are not going to the stakers and validators, instead 80% of them are being burned and 20% are added to the treasury.
The value of the GLMR coin depends on how many people and projects use the blockchain, because the more it’s being used the more coins are being burned. Since the chain and the Polkadot network are very popular and many Ethereum dApps could easily launch on Moonbeam, there will likely be no shortage of development and projects. One thing that is kind of odd is that the validators or GLMR and DOT stakers will apparently not be incentivized after the max supply is being reached, which could hurt the network in the long run, but maybe this could change thru the on-chain governance eventually.
You can buy GLMR on Binance and KuCoin. You can use a MetaMask Wallet to store your coins and interact with dApps on Moonbeam if you connect it to the blockchain.
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