Home / Parachains / Acala Network

Acala Parachain
The Beginner's Guide

Acala is a decentralized finance network and Polkadot’s liquidity hub. It is a scalable, Ethereum-compatible, DeFi-optimized layer 1 smart contract platform with built-in liquidity and out-of-the-box financial applications.

1. PROJECT

What is Acala Crypto?
The DeFi Hub of Polkadot Ecosystem

Acala is a decentralized finance network powering the aUSD ecosystem. It’s a layer-1 smart contract platform that’s scalable, Ethereum-compatible, and optimized for DeFi. With the Acala EVM+, Acala lets developers leverage the aUSD ecosystem while enjoying the best of Ethereum and the full power of Substrate.

Introduction to the Acala Parachain

DeFi

Parachain first block: 2021/12/18 03:36:24 (+UTC)

Acala is the first Polkadot parachain and the all-in-one DeFi hub of this ecosystem.

Acala is a suite of cross-chain financial applications:

Acala Swap, issue self-serviced loans with the…
Acala Dollar stablecoin (aUSD), become liquidity providers, access staking derivatives with…
Liquid DOT staking , and earn high-interest APY on their digital assets.

The network is scalable, Ethereum-compatible, and optimized for DeFi. The decentralized network is governed entirely by Acala Token (ACA) , which also servers as the utility token for operating the network.

How Does Acala Work?

Acala Network offers a stablecoin, a DEX and liquidity staking protocol. Acala provides access to both DOT-based derivatives as well as assets and dApps on the Ethereum network, being EVM compatible.

The network currently consists of Acala Swap, an automated market maker (AMM) based decentralized exchange, and two protocols developed to provide stability and liquidity for the Polkadot network: Honzon and Homa.

Honzon: Honzon is the stablecoin protocol. The stablecoin powered by Honzon, aUSD, is pegged to the U.S. dollar and is backed by crypto assets through a system of collateralized debt positions (CDP).
Homa: The Homa protocol ensures liquidity through an algorithmically adjusted staking strategy. By establishing a staking pool on Acala Swap, Homa tokenizes staked assets.

2. TOKEN

What is Acala Token (ACA)?

ACA is a utility token with a fixed supply of 1,000,000,000. The entire supply was minted in the genesis block at launch.

ACA token utilities: Empowers the community to vote, elect council members, and drive the development of Acala. Auto-adjusts risk parameters such as interest rates or collateral ratio. Allows teams to deploy new Substrate pallets on the Acala blockchain by staking ACA…

DeFi

What is aUSD Token? The stablecoin of the Polkadot Ecosystem

What is aUSD Token? The Stablecoin of the Polkadot Ecosystem aUSD is a multi-collateralized stablecoin, as the most commonly known stablecoin of this type: DAI.