Teleporting Assets

One of the main properties that Polkadot and Kusama bring to the ecosystems is decentralized blockchain interoperability. This interoperability allows for asset teleportation: the process of moving assets, such as coins, tokens, or NFTs, between chains (parachains) to use them as you would any other asset native to that chain. Interoperability is possible through XCM and SPREE modules, which together ensure that assets are not lost or duplicated across multiple chain.

How Teleports work

As you can see from the diagram above, there are only 2 actors within this model: the source and the destination. The way in which we transfer assets between the source and the destination are briefly summarized in the numbered labels on the diagram, and are explained in more detail below:

Initiate Teleport

The source gathers the assets to be teleported from the sending account and takes them out of the circulating supply, taking note of the total amount of assets that was taken out.

Receive Teleported Assets

The source then creates an XCM instruction called ReceiveTeleportedAssets and puts the amount of assets taken out of circulation and the receiving account as parameters to this instruction. It then sends this instruction over to the destination, where it gets processed and new assets get put back into circulating supply accordingly.

Deposit Asset

The destination then deposits the assets to the receiving account of the asset.

The phrases taken out of circulating supply and put back into circulating supply are highlighted above to firstly give an indication of how much flexibility an XCM executor has in implementing the semantics of taking an asset out of and putting it back into its circulating supply. The straightforward answer is to burn the assets to take them out of circulation, but one can imagine that there are indeed multiple methods of achieving the same goal, such as transferring the assets locally to an inaccessible account, and likewise for putting assets back to circulation -- the receiving consensus system can freely choose to implement such semantics by releasing assets from a pre-filled and inaccessible treasury of the assets transferred, or perform a mint of the assets.

As such, the above also gives a hint on the disadvantages of this model -- it requires both the source and destination of have a high level of mutual trust. The destination must trust that the source has appropriately removed the assets that was sent over from the circulating supply, and the source must also trust the destination to put the assets that was taken out of circulation back into circulation. The result of an asset teleportation should result in the same circulating supply of the asset. Failing to uphold either of these two conditions will result in a change in the asset's total issuance (in the case of fungible tokens) or a complete loss/duplication of an NFT.

Teleporting Tokens using Polkadot-JS Apps UI

Here are a couple of things that you need to understand before submitting a teleport transaction

There will be a transaction fee imposed on the source chain. This fee is not automatically deducted from the teleport amount you plan to send. Your account balance should be greater than the teleport amount and the transaction fees. If you do not account for the sending fee, the teleport transaction will fail. The sending fee will be deducted from your account balance.

EXISTENTIAL DEPOSIT

After the teleport, if your account balance drops below the Existential Deposit which is 1.000 DOT, that balance will be burnt and lost. Either plan on teleporting all of your balance or leave enough balance such that the account does not get reaped.

There will be a transaction fee imposed at the destination chain. This fee is automatically deducted from the teleport amount you send. After this fee is deducted, the remaining account balance on the destination chain should be greater than its Existential Deposit. If not, the teleport transaction will fail and the sending fee along with the teleport amount will be deducted from your account balance.

Teleportation can be done through the PolkadotJS Apps interface or through the xcmPallet.limitedTeleportAssets() extrinsic. In the following example, we will be using the PolkadotJS interface to teleport DOT from Polkadot to Statemint.

Navigate to PolkadotJS Apps and connect to the chain with the tokens you want to teleport.

2 Navigate to "Accounts > Teleport". This opens the 'teleport assets' interface:

Fill out the transaction:
1. "send from account" - Select the account with the source tokens.
2. "destination chain" - Select the parachain you want to send the assets to.
3. "send to address" - Select the account you want to be in control of the coins on the destination chain.
4. "amount" - Insert the number of tokens you want to teleport. This does not include the transfer fee
After reviewing the transaction information and fees, click the "Teleport" button. Remember that the destination chain imposes receiving fee on the teleport amount. (It is currently 0.0032 DOT on Statemint.)
Click "Sign and Submit".
Enter your password, and click "Sign the transaction".