XDC Subnet Deployment: A Step-by-Step Technical Tutorial

Each Bittensor subnet has its own native token serving as reward for miners and honours. Subnet honours create value through narratives and buybacks. The FET/AGIX AI alliance failed because it promised integrated AI components without delivering concrete value. Bittensor's subnet model provides superior alternatives by enabling easy integration between compute, storage, and inference subnets without complex alliance structures. This demonstrates how decentralized protocols can achieve what centralized alliances cannot.

Subnet-driven validator sets transfer governance authority from the primary network to individual subnets. Subnets would manage their own validator sets using warp signatures to notify the P-chain, enabling custom staking modules, native token creation, and experimental consensus mechanisms like staged transitions from proof-of-authority to proof-of-stake. This addresses current limitations where elastic subnets require placing all reward tokens on the P-chain during initialization, restricting future flexibility and innovation.

Subnets are independent EVM blockchains running within the main Laminar One network, each with their own native token configurable by developers. This architecture enables game economy control, allowing developers to create currencies with specific rarity and distribution parameters. Subnets can also support non-native ERC-20 tokens for multiple in-game currencies. The toolkit implements subnet support through scriptable objects that configure network connections and display native token balances. This design allows games to have custom economies while maintaining integration with the broader blockchain ecosystem.

DETO (Bitensor's token) creates a flywheel effect for subnet economies. When users pay for inference with DETO and put it into the token pool, they receive a 15% discount on inference costs. This increases token emissions, which attracts more miners and enables more models to be hosted. Conversely, extracting tokens from the pool reduces emissions, creating a vicious cycle. This mechanism incentivizes subnet owners and builders to focus on building genuine value rather than extracting value, aligning economic incentives with network health. The system rewards participation and value creation while punishing extraction.

Subnet tokens have different economic dynamics based on miner types. Compute subnets have miners with electricity costs who sell tokens immediately to match costs. Content subnets have miners with no hard costs who are more inclined to hold tokens. The goal for subnet owners is to create services that generate real-world revenue, enabling buybacks that drive token prices up. Subnets can evolve their marketing strategies across platforms, with X revenues potentially exceeding YouTube revenues. Subnets can also expand into prediction market ecosystems, mapping different market spaces and selling promotion services to brands. Subnet owners should demonstrate intentions through on-chain commitments to the future of their business and subnet. Rather than verbal promises, investors should look for transparent on-chain evidence of revenue reinvestment and business commitments. Subnet owners should focus on building real value rather than planning exits, as the subnet and its miners are integral to the value proposition.

This video demonstrates how to bridge XDC tokens from the XDC Network to the Songbird Network using the Ēnosys bridge, which is the first bridge to enable this cross-chain transfer. The process involves: (1) adding the XDC network to your Metamask wallet by manually entering network details, (2) importing the wrapped XDC (wxdc) token address for the XDC network, (3) importing the exXDC token address for the Songbird network, (4) funding your XDC wallet, (5) connecting to the Ēnosys bridge DApp, (6) wrapping your XDC to wxdc, (7) approving the bridge transaction, and (8) waiting for validators to confirm the transfer. The bridge charges a 1% fee, and once bridged, the exXDC tokens can be used in DeFi protocols on the Songbird Network.

Cross-chain bridges are protocols enabling asset and data transfer between blockchains. They allow swapping assets, transferring value, communicating messages, and executing cross-chain function calls. Bridges are needed because different blockchains offer varying transaction fees, confirmation times, functionality, liquidity pools, and capital efficiency. The bridge process involves converting native tokens to wrapped tokens (ERC20 representations), approving bridge contracts, and using minting/burning mechanisms to create equivalent tokens on destination chains while locking source tokens in escrow.

Cross-chain bridges create significant security vulnerabilities because they allow tokens to move between different blockchains, and compromising one chain's validator set can enable attackers to withdraw tokens from the other chain even if that chain is highly secure. The Ronin hack demonstrated this by exploiting 5 of 9 validators to steal 173,600 ETH, which the project must now buy back from the market, creating additional buy pressure. This vulnerability exists because bridges are semi-centralized systems where a single point of failure can be exploited with relatively low effort compared to attacking the main chains directly.

XDC (XinFin Digital Contract) is a not-for-profit blockchain platform primarily serving government clients. The XDC Trade Network is tokenizing trade documents within a standardized framework called MLET (Multi-Ledger Electronic Transaction). This represents the standardization of protocols for sending trade documents between parties. XRP serves as a transmission or bridge for financial institutions to send data or value back and forth through ISO protocols.

XDC Network's 2.0 upgrade introduces subnet architecture, enabling the creation of separate public or private blockchains on top of the main network, with block finality of 6 seconds (3 blocks at 2-second intervals) and Byzantine fault tolerance for enhanced security, along with gasless subnets allowing users to pay fees in fiat currencies through a payment gateway, which removes barriers to adoption and enables institutional use cases like carbon tracking, national ID systems, and high-frequency payment networks.

Prometheus serves as a time series metrics database for collecting pipeline metrics, while Grafana provides visualization capabilities. Time series visualization enables powerful monitoring dashboards. Alerting works by establishing baselines from historical metrics and setting thresholds, then implementing more sophisticated algorithms over time. Effective alerting pages on symptoms rather than root causes, creating diagnostic trails for troubleshooting.

Prometheus is a time-series monitoring tool that collects metrics from targets (machines, applications, containers, or Kubernetes clusters) using exporters that expose endpoints, while Grafana provides visualization dashboards for the collected data; together they form a complete monitoring solution that includes data collection, visualization, and alerting capabilities.

Prometheus is an open-source monitoring and alerting toolkit that collects metrics from applications and infrastructure using a pull-based model, while Grafana provides visualization dashboards for monitoring data; together they enable teams to track system health, detect issues proactively, and maintain service availability through metrics collection, alerting, and visualization.

Prometheus is a monitoring and alerting system that scrapes metrics from various services. However, it is typically used in conjunction with Grafana for visualization. Data from systems like TrueNAS often requires exporters (like Graphite exporter or SNMP exporter) to convert their metrics into formats that Prometheus can scrape. This creates a complete monitoring pipeline where data flows from the monitored systems through exporters to Prometheus, and finally to Grafana for dashboard visualization.

Prometheus is an open-source monitoring system that collects and stores metrics from various targets (servers, containers, applications) through a scraping mechanism, while Grafana provides visualization capabilities to create customizable dashboards for monitoring server health, resource utilization, and performance metrics; together they form a powerful centralized monitoring solution where Prometheus handles data collection and storage, and Grafana enables intuitive data visualization through its query language and dashboard builder.

Subnets can be customized for different use cases including app-specific subnets for gaming, geographically bounded subnets with nodes in specific regions or data centers, and infrastructure subnets like databases or caches. Subnets work in concert to deliver highly scalable dynamic decentralized applications. Subnets receive EVM compatibility for free and support specialized logic as WASM actors written in any supported language that compiles to WASM.

Subnets are app-specific blockchains that solve the fundamental problem of one-size-fits-all solutions. Using a web page analogy: just as Google.com, Uber.com, and Amazon.com are separate domains, subnets are separate blockchains that can be customized for specific use cases. Gaming is a primary use case because games require high throughput and low/no transaction fees—impossible on regular blockchains. Subnets allow games to customize fee structures using in-game tokens instead of network fees. The key insight is that different applications have different needs, and a single chain cannot efficiently serve all use cases.

Scale Network positions itself for 'High Performance DApps' requiring high throughput and low costs. The chain fees model makes it economically impossible for competitors to match Scale's unit economics. This strategy attracts not just games but also high-throughput applications like AI prediction platforms. Success breeds success through developer-to-developer communication, open-source contributions, and ecosystem growth. The network's EVM compatibility and native Ethereum connection create a flywheel effect where developers don't need direct support to deploy.

Subnets are designed as flexible, low-level infrastructure that can scale to handle millions of transactions per month. Unlike other blockchain approaches that require running auctions or using complex governance systems, subnets provide a pure, scalable infrastructure solution. This architecture enables teams to create app chains that operate at 'unicorn level' scale, making it the preferred choice for teams building ventures that require high throughput and performance.

Vitalik Buterin's vision for 100x scaling refers to Layer 2 rollups, not base layer improvements. The general consensus among Ethereum developers is that the Layer 1 will become a net aggregation layer for all liquidity across Layer 2s. When users make transactions on Layer 2 chains like dYdX (powered by Starkware rollups) or Arbitrum, they can achieve thousands of transactions per second while still settling on the secure Ethereum base layer. This provides the performance of centralized exchanges with the security of decentralized networks. The speaker emphasizes that as users start living on Layer 2s rather than Layer 1s, we will see both super high transaction throughput and very low latency, where clicking a button completes a transaction instantly rather than waiting for block times.