Polkadot is a decentralized open-source blockchain, a virtual network that allows the development of parachains, thereby simplifying the development of blockchains for new projects.
The developers use the term “multichain” on the project’s official website to describe the technology. In simple words, Polkadot is a network that connects blockchains into a single space that allows for fast and secure processing and exchange of data from different blockchains. So keep an eye on the forecast polkadot price prediction 2030.
One of the main features, the developers consider smooth updates – without massive system-wide updates or hard forces.
Why Polkadot is called the Ethereum Killer
Just as the Ethereum network has been called the killer of Bitcoin, the Polkadot network has been called the killer of Ethereum itself. Unlike the Bitcoin network, which only transmits information about transactions and the number of coins in wallets, the Ethereum network can be used to create arbitrary “smart contracts” and issue tokens in the ERC-20 standard.
Polkadot developers have gone even further and implemented the ability to create networks of other projects based on their blockchain. Such derivative networks are called parachains.
A parachain is an independent blockchain with its token and optimizing functionality for specific tasks and project needs. Parachains have all the advantages of Polkadot and can interact with other projects within the network. The number of Polkadot parachain spots is limited and will be allocated through auctions. Here it is possible to carry out pancake swap matic.
DOT Cryptocurrency: capitalization, current rate and forecast
The first ICO (initial sale of tokens) of DOT cryptocurrency was held in the fall of 2017. Then 2.7 million coins were sold at $0.29 per token.
The DOT token reached a maximum price of $49.69 on May 25, 2021, and the maximum capitalization of the coin was over $43 billion.
You can always find the current Dot token rate and capitalization here. As of today, the capitalization of the project exceeds $20 billion, while auctions on the main network have not yet been launched. Judging by the project’s roadmap, auctions for parachains will take place this year, which means that we may soon see the DOT token exchange rate increase due to the participation of these coins in the auctions.
In addition to their value transfer function, Polkadot network tokens are used for:
- voting in a parachain auction
- Validator nomination
- voting on the development of the project
All this allows the owner of tokens to generate income, but about that I will tell a little later, but for now I need to mention another related project of the creators of Polkadot – Kusama.network
Kusama experimental network
Kusama.network is an experimental network, very similar to the Polkadot network. However, the developers emphasize that the network is viable and independent of the main Polkadot network. The Kusama network has its own KSM token, which performs the same functions as the DOT token.
The Polkadot network differs from the Kusama network in that it has a shorter era (internal periods within which parachain auctions take place). This allows developers to quickly refine their blockchains before moving them to the main Polkadot network.
To date, the first auctions have already taken place on the Kusama network. One of the brightest projects is Karura, the test blockchain of the AcalaNetwork project, which will soon debut on the Polkadot auction.
Every day new projects are created in the crypto industry, but only a small part of them deserves attention, and Polkadot is one of such projects, which will show itself yet.