The Polkadot cryptocurrency with a capitalization of $ 17.7 billion is confidently in fourth place in this indicator, and this is at a low cost. The asset is considered promising and deserves the attention of crypto investors. We will tell you what the features of the token are, where you can purchase it, and what further development the experts expect.
Polkadot is a system that tries to unite various specific blockchains into a particular system. They merge with the main chain run in parallel to each other and are called parachains. Once connected, they have access to Proof-of-stake transaction verification and other security measures on the Polkadot web.
The ambitious goal of the project is to work as a framework for all blockchains. That may be compared to how HTML lets sites, browsers, and servers communicate with each other. The intention is to get rid of expensive mining methods and allow developers to concentrate on building functional dApps and clever arrangements.
DOT token and its role in the Polkadot project
DOT is the native cryptocurrency of the Polkadot ecosystem that performs three main functions:
- Adding or removing new parachains to the ecosystem.
- Staking is the motivation and reward of honest participants.
- The right to control the protocol.
The management function includes determining the network fees, the schedule for adding parachains, as well as exceptional events such as updates and fixes to the Polkadot platform.
Closest rivals and differences
The largest competitor to the Polkadot cryptocurrency is considered to be Cosmos, which has been operating on blockchain interoperability since 2014 and was officially started in March 2019. In many respects, its principle of operation is comparable to Polkadot.
In addition, WanChain is engaged in interoperability analysis, and the Dfinity platform is developing options for increasing the scalability of blockchain networks.
Mining cryptocurrency Polkadot
Consensus on the network is carried out using the PoS algorithm, not PoW, so mining in the literal sense (like Bitcoin) is not available. New coins are mined by staking.
Staking works here as follows: a participant can become either a nominator or a validator. Nominators nominate one or more (but not more than 16) validators whom they trust. Validators help you earn rewards for confirming transactions.
There are certain requirements for the validator node. He must be available 24/7 and fully fulfill the duties assigned to him.
Prospects and forecast
The DOT cryptocurrency performed well during the launch phase, then faced a record low rate of about $ 2.7 per 1 DOT, but has shown steady growth since then. According to assumptions, a surge in value should be expected in the summer to $ 25-30, and by the end of 2021, digital assets will be trading at $ 23.
According to other forecasts, in December 2021 the exchange rate could rise to $ 50 if development proceeds as smoothly. One way or another, many analysts and traders see potential in a long-term investment.
If we talk about polkadot coin price prediction 2030, it is impossible to predict it correctly.
The Polkadot ecosystem held a very prosperous boat and quickly rose to fourth place in terms of business capitalization. Now the project faces an even more difficult task – to maintain these positions, because there are competitors in the field, and they are working no less actively.
However, competition is the key to progress, and soon we can count on improving scalability and manageability in cryptography and blockchain networks anyway. Visit The Tech Diary again for awesome articles.