Polkadot (DOT) is a blockchain with a core network — the relay chain — that connects and communicates with other blockchains. By hosting blockchains, the relay chain also handles their security and transactions, allowing cross-chain interoperability (connection between multiple blockchains) to run smoothly. In reality, in addition to moving DOT tokens between blockchains, Polkadot allows them to interact and exchange genuine data. Thus, interoperability is the major issue that Polkadot is attempting to address. Instead of being separate organizations that operate separately, blockchains should become part of the same ecosystem where information and money may be shared safely and scalable. Polkadot even handles communication between these two unique types of networks, despite the fact that private blockchains use somewhat different technological protocols than public blockchains.

History

The network's name is already something else: A polka dot design on cloth is made up of an array of huge, filled circles that are of the same size. The circles most likely represent the several blockchains and the overall pattern, the Polkadot crypto universe. Polkadot's history is associated with Ethereum's. Its founder is Dr. Gavin Wood, who formerly served as Ethereum's chief training officer and core developer. Solidity, the company's smart contract programming language, was created by him. The principal developer departed Ethereum in 2016 to design a more sharded blockchain, and he released Polkadot's white paper in October of the same year. Wood co-founded the EthCore Blockchain Technology Company while remaining at Ethereum, which subsequently became Parity Technologies.

The organization launched an initial coin offering in October and raised 145 million USD in little under two weeks, making it one of the biggest ICOs to that point.

How does it work

The protocol of the relay chain dictates the network's shared security, consensus, and cross-chain interoperability. It is the engine that holds the entire infrastructure together, linking other network members and ensuring transaction completion. The relay chain was purposefully designed to be as simple as possible. Smart contracts, for example, are not supported, and the chain's primary duty is to coordinate the whole system, including parachains. Parachains is an abbreviation for parallelized chains. They are sovereign blockchains with their own coins and governance, as well as their own set of use cases.

However, parachains leverage and benefit from the relay chain's security and interoperability for transaction finality. The utilization of the relay chain allows parachain's system to run smoothly, allowing developers and users to focus on other specific goals like as privacy or scalability, as well as their specialized applications. In essence, parachains have access to one of the network's most significant advantages: the use of Polkadot's established security and quick and scalable transaction rates.

To join in the network, parachains must lease one of the hundred Polkadot slots. Because of its limited space, parachain's slot allocation may become quite competitive and difficult to get in the future.