What is Clover Finance?
Clover Finance (CLV) serves as a foundational layer designed to enhance cross-chain compatibility, enabling developers to effectively bridge decentralised finance (DeFi) decentralised applications (dApps) between the Ethereum and Polkadot networks.
The CLV Token
CLV is the native utility token of Clover Finance. It plays a crucial role in governance, allowing holders to vote on platform changes. CLV is also used to pay for transaction fees on the network. An interesting feature of the token is its ability to facilitate fee payments on behalf of other addresses through a mechanism known as “Relayer”.
Staking and Network Participation
Users can stake their CLV tokens by running their own nodes or by using a nominated validator, which is part of the nominated Proof of Stake (PoS) model. This not only allows CLV holders to earn rewards but also grants them the opportunity to participate in the network consensus process, ensuring the security and functionality of Clover Finance.
Technology Behind Clover Finance
The Clover Finance platform employs SPV (Simple Payment Verification) Chain Simulation Technology, creating a robust two-way peg system between blockchains. This advanced technology supports cross-chain communication, which is essential for seamless interaction between the Ethereum and Polkadot networks.
EVM Compatibility and dApp Migration
Another critical aspect of Clover Finance is its EVM (Ethereum Virtual Machine) Compatibility Infrastructure. This framework enables existing dApps on the Ethereum network to migrate easily to Clover Finance, fostering innovation and user adoption on the platform.
Layered Architecture for Interoperability
The architecture of Clover Finance consists of a four-layered system: the storage layer, smart contract layer, DeFi protocol layer, and external dApp layer. Each of these layers functions in harmony to accomplish blockchain interoperability, allowing various dApps to operate and communicate across different networks.
Gas Fee Redistribution Model
Similar to Ethereum, Clover Finance employs a Gas Fee Redistribution model. This model ensures that a portion of the gas fees collected from transactions is distributed to network nodes that maintain the infrastructure and to the developers of the dApps, incentivising both parties to contribute to the ecosystem.
Official Resources
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