💭 What's a parachain, and how does it differ from a rollup? 💭

Though it is cheap and fast to transact on, Moonbeam is not an L2. It's a Laye 1 blockchain, and more specifically, it's a parachain.

Much like modular blockchains or Ethereum rollups, parachains on Polkadot can have their own custom attributes.

HOWEVER

🔽 Unlike most Ethereum rollups (L2s), which batch transactions and send proofs to mainnet for consensus, parachains are L1 blockchains that use their own native token for both transaction fees and governance while still benefiting from Polkadot security.

🔽 Parachain DPoS is used to elect a set of Block Producers (community-run decentralized sequencers) that submit blocks to the Polkadot Relay Chain for a 12-second finality. Moonbeam distributes inflation-based rewards to block producers based on the blocks they produce. Now that Polkadot has async-backing, blocks are moving from 12s to 6s.

🔽 On the interoperability front, thanks to Polkadot's XCM (cross-consensus messaging), parachains/appchains can easily exchange information and assets with each other without relying on third parties, minimizing bridging-associated risks.

Here's where Moonbeam stands out from other parachains 👇

Coupling XCM with other GMP solutions and EVM compatibility has made Moonbeam the point of entry/exit to and from Polkadot for cross-chain activity.

Moonbeam has become the hub for liquidity thanks to MRL(Moonbeam routed liquidity), which allows users to move liquidity in and out of Polkadot with a simple 1-click experience.

🌕 This is how Moonbeam integrates web3.