Polkadot (DOT) announced it will begin to auction parachain slots soon. Polkadot's canary network, Kusama (KSM), has already successfully auctioned off parachain slot leases in 10 auctions. Each slot is leased for a set amount of time, broken into 6-week segments, with a max of 48 weeks. Analysts expect the Polkadot main network to follow the same auction procedures.
Polkadot is a platform for making blockchains that are "tracked" by the main Polkadot blockchain, called the Relay Chain. Polkadot-based projects use the Relay Chain to verify and finalize transactions on their own chains.
Polkadot-based projects connect to the Relay Chain using Parachains. Polkadot artificially limits the number of Parachain slots to 100. This means that there are only 100 slots to connect to the Relay Chain. Projects can rent space from a company with a slot if they cannot afford to lease their own.
Kusama slot winners are locking up 100,000 to 200,000 KSM ($35-70 million) for 48 weeks to lease a parachain slot for the 48-week max. Participants in the auctions include projects like Moonriver (MOVR), an Ethereum-compatible blockchain for Kusama, and Karura (KAR), a decentralized finance and loans platform on Kusama.