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What is Polkadot $DOT ?

what is Polkadot

Innovation is something that can be embedded in the world of cryptocurrency and blockchain, because the crypto world continues to present a variety of interesting projects aimed at solving certain problems.

One of the interesting projects this year is Polkadot, this project is also alleged to be able to compete with Ethereum which was already famous. Polkadot is also predicted to have great success next year.

What is Polkadot

Polkadot is a network designed to combine blockchain networks with other blockchain networks. This is usually referred to as a multi-chain network, because it can link networks together, unlike networks like Bitcoin, which operate alone. 

This blockchain can act as a kind of decentralized center for any type of blockchain. This is like how HTML allows websites, browsers and servers to interact with each other.
How it Works Polkadot

Blockchain can connect with Polkadot and work in parallel because there is such a thing as Parachain which can be added or removed. 

Parachains can be public blockchains, private blockchains, or other data sources. Data in parachains are accessed via special nodes, called collators, and sent to Polkadot. 

This is similar to how a decentralized oracle works. Parachain is activated by staking the DOT token, and removed from Polkadot by releasing this same token.

Polkadot main chain, also known as Relay Chain which supports smart contracts. This is secured by a type of DPoS (Delegated Proof of Stake), which Polkadot calls NPoS (Nominated Proof of Stake). 

The system consists of a nominee and a validator: Nominators use their tokens to select validators, who in turn validate (mine) new blocks. If the validator acts maliciously, he will be punished along with the nominees who voted for him.

Parachain can support features found on many other blockchains, including smart contracts (Ethereum), ZK-snarks (Zcash), and UTXO transactions (Bitcoin). These features are not a fundamental part of Polkadot, instead, they can be added and removed from the parachain.

Developers can also use functions that are in other parachains. There are many use cases for Polkadot parachains, including the transaction chain, oracle chain, identity chain, file storage chain, data curation chain, IoT chain, financial chain, and privacy chain.

History of Polkadot

Polkadot was developed by Parity Technologies, led by Gavin Wood and Jutta Steiner, two former Ethereum executives. 

The project is also supported by the Web3 Foundation, an organization that provides funding, advocacy, research and collaboration for the project.

Parity was founded in 2015. Initially, Parity started working on a software node for Ethereum, which was called the Parity Ethereum client. The company has phased out support for the project, leaving it to focus on Polkadot and a related project, Substrate.

Development started in November 2017, when the developers published the first code on Github. The company launched two proof of concept in mid-2018 and deployed Polkadot's first parachain in July 2018. 

Polkadot was launched in an “initial” state in May 2020, and token transfer activated in August 2020.

Infrastructure at Polkadot

Parachain is just one of several components that make up the Polkadot Network. Other components include:

  •     Relay Chain: The main communication center between the parachain and the "core" Polkadot.
  •     Parachains: Independent blockchains that run on relay chains, bound and ordered by auction.
  •     Parathreads: A lighter alternative to parachain for developers who just want to try Polkadot, offered on a pay as you go model.
  •     Bridges: Modules and contracts connected to other blockchains such as Bitcoin and Ethereum.

In addition, there are several actors in the Polkadot network who keep the blockchain operational, namely:

  •     The validator, which locks the DOT token, validates the evidence from the collator and participates in the consensus.
  •     Nominators, who lock DOT tokens and secure the relay chain by selecting trusted validators.
  •     Collator, which collects transactions and creates evidence for the validator.
  •     Fishermen, which monitors the network and reports malicious activity.

Polkadot Advantages

  •    Scalability: Polkadot supports multiple blockchains through a mechanism called "sharding" or parachain. This allows transactions to be processed efficiently and parallel.
  •     Interoperability: Various parachains and Polkadot applications can share information and functionality thanks to the operable project design and compatibility between chains.
  •     Specialties: Each Polkadot parachain can be adapted to a specific use case or application.
  •     Upgrades without forks: Polkadot is upgradeable without time-consuming hard forks, so new features can be added without completely overhauling the network.

Original DOT Token from Polkadot

DOT is an internal token of the Polkadot network. This token allows the holder to vote on potential code changes, which then automatically upgrade the entire network if consensus is reached. Previously, Polkadot raised about $140 million by selling its DOT tokens at the 2017 ICO. 

The company also ran two private sales in 2019 and 2020 and raised about $100 million in subsequent sales.

Due to a bug in the Ethereum Parity wallet, about half of the original ICO tokens were frozen. The frozen token has not been recovered, but the loss does not affect Polkadot's ability to operate. 

Polkadot started allowing investors to trade remaining tokens from August 2020. Since then, DOT has been listed on more than 40 exchanges, and high trading volumes have caused the coin's market cap to skyrocket.

DOT tokens are also “re-denominated” by a factor of 100x when trading starts. This doesn't change the market cap of the token and only makes the token count easier to read. There are three main uses for DOT tokens apart from basic financial transactions, namely for governance, stacking and bonding.

Polkadot is a promising project. Given that many application developers are looking for ways to reach a wider audience, and given that there are many blockchains, this platform can be useful for many people to connect with each other using blockchain technology. 

The DOT token that has received a warm reception and the skyrocketing price can also benefit the reputation of this project.

Yulina Firmansyah
Yulina Firmansyah Hi, I am a wife who really loves crypto and blockchain technology, I am a writer for this blog.

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