Polkadot, founded by Web3 Foundation, is positioned as a next-generation blockchain protocol, capable of connecting multiple specialized chains in a universal network. With special emphasis on creating infrastructure for Web 3.0, Polkadot aimed to disrupt Internet monopolies and empower individual users.
Since individual blockchains cannot communicate with each other, the introduction of interoperability between different chains could lead to the exchange of data and eventually more powerful services and applications.
Today connecting many blockchains at once is still a pressing problem. The Polkadot team is confident that a suitable solution can be created in the years to come, and claims to be the next step in the evolution of blockchain technology.
An introduction to Polkadot
It is an open-source protocol for everyone. Polkadot, the flagship project by Web3 Foundation, a Swiss Foundation created to facilitate a fully functional and user-friendly decentralized web. One of its founders is Dr. Gavin Wood, co-founder of Ethereum. Wook and his team focus their efforts on providing security, scalability, and innovation. This requires the necessary infrastructure to support new ideas and concepts, and also to ensure that adequate interoperability can be achieved.
The individual blockchains of the Polkadot ecosystem are called parachains (parallel blockchains), while the main chain is called Relay Chain. The idea is that the parachains and the Relay Chain can easily exchange information at any time.
Any developer, company, or individual can launch their custom parachain through Substrate, a framework to create cryptocurrencies and decentralized systems. As soon as the custom chain is connected to the Polkadot network, the first one becomes interoperable with the rest of the network’s parachains.
Creating cross-chain applications, products and services should be much simpler with this design.
Advantages and contribution of Polkadot
There are many reasons why developers can be interested in exploring the Polkadot ecosystem. Due to the limited nature of current blockchains, there are some fundamental issues to solve: scalability, customization, interoperability, governance, and updates.
Scalability
At the scalability level, Polkadot meets many of the requirements. As it acts as a multichain network, allows the processing of transfers in parallel through different individual chains. This removes one of the biggest obstacles associated with blockchain technology today. Parallel processing is a significant improvement, and it can pave the way for wider global blockchain adoption.
Customization
Those looking for customization can take advantage of other Polkadot features.
Nowadays, there is no “one single blockchain infrastructure to rule them all.” Each project has its individual needs and requirements, and Polkadot allows an individual chain to optimize its design for that specific function. With the help of Substrate, developers can efficiently adapt their individual chains to meet project needs.
Interoperability
The fact that projects and applications share data seamlessly is an important factor. While it remains to be seen what kinds of products and services it will create, there are many possible use cases. It can create a completely new financial ecosystem, in which each individual parachain takes care of one particular aspect at a time.
Governance
Any community associated with a specific parachain will be able to govern its network as it sees fit. Furthermore, all communities are crucial to the future Polkadot government as a whole. Collecting feedback from the community can generate valuable information that evolves projects over time.
Updates
Polkadot makes it easy to update individual parachains. There is no need for hard forks, as this can divide communities. Instead, the native string can be updated without friction.
Polkadot own token: DOT
Polkadot has its own native token known as DOT, it serves as the network’s token, just as ETH is the Ethereum token and BTC is the Bitcoin token.
There are several use cases for this token
Although DOT has a monetary value on exchanges, the creators of Polkadot have claimed that it is not a token designed for speculation. It basically has the below use cases:
- It gives token holders governance rights to the entire Polkadot platform. This includes determining network fees, voting on general network updates, and the deployment or removal of parachains.
- It also facilitates network consensus through staking. As with other networks that involve staking, all DOT holders give incentives to users at all times. Otherwise, they could lose their share.