Exclusive: Bithumb set to launch DeFi platform as a Polkadot Parachain

Bithumb, a major cryptocurrency exchange based in Korea, announced the upcoming launch of Clover, a blockchain platform targeted for decentralized finance and powered by Polkadot technology.

The company says that Clover will be an open platform for DeFi applications, leveraging cross-chain capabilities and connecting decentralized finance to the centralized exchange.

Clover is built on Substrate, Polkadot's custom blockchain framework.

While Substrate does allow for the launch of independent blockchains, Bithumb plans to launch Clover directly as a parachain, the term used to describe Polkadot shards.

The platform is part of an overarching trend of centralized exchanges launching their own blockchains for DeFi, with Binance CEO Changpeng Zhao coining the term "CeDeFi" to describe these efforts.

Chris Li, Clover CEO and formerly the chief marketing officer of Bithumb Global, told Cointelegraph that the exchange has a different vision for the platform.

"Bithumb will be the major investor/supporter for Clover, and we plan to use Bithumb as a custodian solution for cross-chain transactions before Polkadot decentralized solutions become available," he said.

Li said that the company believes the next stage for DeFi is "Transferring assets and value across different platforms," and that Bithumb will contribute to advance the overall DeFi and Polkadot ecosystems.

Clover will launch as a parachain, meaning that the date of release depends heavily on Polkadot enabling parachain slot auctions.

The support from Polkadot was crucial for the company's plans of a custom blockchain, as "Bithumb tried to build chains before but no result came out," Li added.