• On parachain developer can create their own blockchain network
• Developers can lease slot on the Relay chain for a maximum two years period and minimum for a six month period.

Parachain is an application specific data structure which is globally coherent and can be validated by the validator of the relay chain. Polkadot parachain name is taken from parallelised chains concept which runs parallel to relay chain. Parachain are heterogeneous blockchains that are connected to polkadot and they are interoperable with other networks and parachain.

Parachain is a platform where developers can create their own blockchain network, like ethereum where decentralized applications are created within the bound limits of blockchain. Palkadot maintains the security of parachain through relay chains instead of having validator nodes. Collateral nodes maintain the parachain and store all the data of parachain and aggregated parachain transaction data into blocks which are added in the Relay Chain. 

How to run a Parachain on Polkadot

Anyone wants to develop a parachain based project he/she needs to first run the parachain on Polkadot. So he/she has to lease a slot in Relay Chain, a developer can lease a slot from parachain slot auction, where developer can bid for slot in exchange of native token (DOT). a developer can have a leased slot maximum for a two year period and minimum for six months period. 

The developer has to lock its token, developer has to keep a reserve in his/her account for the he/she has leased parachain, he/she cannot use this tokens for staking, transferring or for any other use.

Cost incurred in running parachain on Polkadot To run a parachain, the first developer has to buy a slot on Polkadot. Then, afterwards,  there is as such no cost is incurred, at the time of leasing slot developer locks the tokens which becomes the overall cost that a developer can incur. Other than this, a developer can have a cost of rewarding contributors, where developers acquire funds from crowd loans who contributed tokens for leasing parachain.   

Parachain consensus 

Parachain consensus runs on the Polkadot Relay blockchain. It is not allowed to para chain to use other consensus than the Polkadot Relay chain. It means that parachain cannot execute block finality outside the scope of Polkadot, but it can control how and who can write the block. One can have their own consensus for sovereign chains which bridge Relay chains through parachain. 

Advantages of Parachains 

Flexibility – for modeling of parachain, Polkadot has given optimum features, the only criteria imposed by Polkadot mandatorily is that the parachain must prove to the Polkadot validator that each block is connected according to the Relay chain  consensus.

Scalability – scalability means the interoperability of the blockchain, so if a blockchain can interact with other blockchain, that means it is scalable blockchain. This defines the scalability of the blockchain. Otherwise, blockchains have to rely on layer 1 solution for interacting with other blockchain, while parachain provides interoperability at layer 1 itself, which proves that parachain is a more decentralized and efficient means to achive blockchain scalability.

Interoperability

The biggest advantage with parachain is that it inherently acquires to Polkadot’s cross chain composability. thus , it provides full control and sovereignty to blockchain community and also allows them to trade in other parachain and external networks.on parachain you can exchange any type of data like smart contract, off-chain information from oracle, verifiable credentials and not just tokens.