Simar Marwaha
    Simar Marwaha
    Published on October 21, 2022 11:02 AM

    Updated on January 26, 2023 3:01 PM

    In the short time it has existed, Polkadot has grown to be one of the biggest and most well-known cryptocurrency blockchains in the whole market.

    What is Polkadot?

    In order to enable people to create and manage their own blockchains, Polkadot is software that aims to reward a worldwide network of computers for running a blockchain. Polkadot is a blockchain network and cryptocurrency. The Polkadot platform supports a wide variety of blockchain applications, while it may be best known for DOT, the network's native currency. Everyone in the Polkadot community has access to the platform's source code and may make contributions since the Polkadot blockchain is open-source. In a nutshell, Polkadot is a multi-chain, heterogeneous, scalable solution.

    How Does Polkadot Operate?

    Nominated proof of stake (NPoS) is the operational protocol used by the Polkadot blockchain. Using this manner, Polkadot community members can suggest additional community members to help manage the Polkadot blockchain on behalf of those who stake—agree not to trade or sell—their DOT.

    Because so many parachains help the main relay chain with a lot of the heavy labour, Polkadot is able to analyse all of this data. As a consequence, compared to around 7 for Bitcoin and 30 for Ethereum, the Polkadot network can execute more than 1,000 transactions per second. Polkadot should become more quicker as the network expands and new parachains are added, with rates that might reach a million transactions per second.

    There are several categories of members in the Polkadot community, and they all have certain tasks to play in running the blockchain. These are the four primary roles, which are briefly detailed below:

    1. Nominators: Nominators are DOT holders who risk their money and take part in the voting process to choose new validators.
    2. Validators: To add new blocks to the Polkadot blockchain, Polkadot network validators process and record transactions.
    3. Collators: Collecting transactions from various sources, these Polkadot community members consolidate them for processing by validators.
    4. Fishermen: People that keep an eye on a network for inappropriate activities are referred to as fishermen.

    Technologies Associated with Polkadot

    On the blockchain network, Polkadot facilitates the simultaneous processing of several transactions. The Polkadot blockchain network makes use of a mix of these four technologies to enable parallel processing: 

    1. Relay chain: The relay chain, which is the main Polkadot blockchain, is used to support cross-chain activities and uphold network security. The relay chain is in charge of maintaining interoperability, consensus, and shared network security. The relay chain is in charge of reaching consensus and making sure that transactions are carried out; it verifies data and makes sure it is comprehensible.
    2. Parachains: Parachains are a type of semi-autonomous blockchain that are capable of hosting their own cryptocurrency tokens and run according to their own set of rules and functionalities. In essence, parachains are PoS blockchains that may function independently and have their owner's full customization. Their attention is on software with exclusive features and self-contained programming logic. These chains act as the network's governance layer and as a management tool.
    3. Parathreads: Parathreads have a limited degree of autonomy. They are utilised for less resource-demanding apps that don't require a continual connection to the Polkadot network. Parathreads, a scaled-down variation of parachains that operates on a pay-as-you-go basis, is another component of the network. For blockchains that don't need constant access to the Polkadot network, it is helpful.
    4. Bridges: Additionally, Polkadot has bridges that link blockchains and enable data transmission across them. Interoperability is established using bridges, which are also used to link to other networks like Ethereum and Bitcoin (BTC). The links between parachains, parathreads, and other blockchain networks like Ethereum are known as bridges.

    Also read: Polkadot Round Up; A Brief About the Parachain Development Going On

    Polkadot Investing

    By purchasing DOT, Polkadot's local currency, you may make an investment. Here's how you get and keep DOT safe:

    1. The first step is to purchase Polkadot via one of the several cryptocurrency exchanges. Binance, Coinbase, and Kraken are a few of your choices. Pay close attention to transaction costs because they vary depending on the exchange.
    2. The second step is to decide how much DOT you want to buy and then start a buy order on the exchange. To submit your order preferences, visit the exchange's website or mobile app. Verify your entry of the purchase order one more time, then click the "buy" button. For instance, your Polkadot transaction should be finished in two minutes using the Kraken exchange.
    3. Any of the big cryptocurrency exchanges may store DOT for you as your third step. You may also move your DOT to a hardware or software wallet of your choosing. Some of the best hardware and software wallets currently on the market are compatible with Polkadot. Being highly volatile and dangerous as investments, cryptocurrencies like DOT require caution and the strongest possible protection.

    The Bottom Line

    Polkadot is one project that the community and investors have taken seriously among all the potential competitors to Ethereum. Its original idea of unified parachains opens up more opportunities for consumers and developers in the approaching Web3 world. DOT, a natural asset of Polkadot, has already increased in value significantly and is considered a potential project by many experts.

    To determine whether this is the asset you want to take a closer look at, read our Polkadot token price prediction. It is simple to get caught up in the enthusiasm and wonder what this innovative platform will look like in a year or two as excitement surrounding Polkadot builds as its slot auctions go live and its complete network capabilities attract interest from investors and projects alike.

    Although the platform does include certain risks and potential drawbacks, it is supported by an excellent staff, has joined forces with esteemed partner projects, and has thus far lived up to expectations.