Polkadot: Building Bridges & Parachains With DOT

What is Polkadot?

Polkadot (DOT) is a blockchain platform with advanced interoperability and scalability features started in 2017 by Gavin Wood, the co-founder of Ethereum. Aimed at connecting other blockchains with unprecedented flexibility and efficiency, Polkadot strives to become the leading multichain framework on the market. It is expected to launch in the second half of 2019, along with its main token DOT.

Shared Security

In Polkadot, there is a hub and spokes approach to interchain operability. The central blockchain, called the Relay Chain, is used for validation and interconnection of all others, called parallel chains or parachains, allowing them to rely on the Relay Chain’s consensus mechanism – Nominated Proof-of-Stake (NPoS). This allows for higher efficiency of the network as a whole. Parachains are free to set their own rules and parameters while not being entirely “sovereign”. There will also be parachain bridges that will allow connecting existing non-compliant blockchains such as Bitcoin or Ethereum to the Polkadot network.

Stiff Competition

Despite being a pioneer of cross-chain communication at its inception, Polkadot has not yet been released, and a number of other platforms and protocols are starting to gain traction, such as Cosmos and the Aion Network. At this point, Gavin Wood’s reputation and the relative infancy of blockchain technology are the biggest external factors at play here, but the project will still have to compete for space in an already tight field. Cosmos is arguably Polkadot’s main potential rival. Albeit similar in design, the two projects are very different in principle. While Cosmos offers a one-size-fits-all solution, with multiple hubs and chains having the freedom to choose their own consensus and validation procedures, Polkadot is designed with the shared security umbrella in mind. At the same time, it allows for the transfer of all kinds of data between parachains, whereas in the Cosmos Inter-Blockchain Communication protocol assets only can be sent from chain to chain.

Promising Technology

While there are many unique aspects of Polkadot, it has a lot in common with many new blockchain platforms. Nominating in NPoS works similarly to the delegation in DPoS, so users can earn effortlessly earn rewards by staking their coins. Another great thing about Polkadot is just how easy it is to set up a parachain. Although it has to be secured by a certain amount of DOT tokens to begin operation, for most projects this wouldn’t pose any challenge. Parachains can also be eliminated if demand runs low or if the community reaches that decision. But the main advantage of this network is Substrate, a blockchain software toolkit developed by Parity Technologies which supports any language that compiles to WebAssembly and is expected to be a game changer, just like Solidity once was. Not all parachains will be built on Substrate, and not all Substrate chains will be on Polkadot, but the two technologies are being developed side-by-side.

Where to store DOT?

As soon as Polkadot will be up-and-running, you will be able to send, receive and exchange your DOT tokens in the Magnum Wallet. We offer an intuitive interface and a number of useful features, including hardware wallet support, built-in exchange services, watch-only wallets, and the support of over 1000 coins and tokens. And most importantly, Magnum is non-custodial, so only you have control over your private keys, and no personal information is collected in the process.