Polkadot is a network that connects blockchains. It solves scaling problems by allowing different types of chains to pool their security, communicate with each other and form one large blockchain ecosystem. The benefits are enormous – it becomes much easier to create scalable dapps which can utilize the entire network. This keeps the individual chains competitive instead of becoming obsolete and unprofitable as they’re left out. This kind of project is a massive opportunity for Ethereum since it would grow the overall size of its ecosystem and attract new developers that want to create scalable projects.
A very short summary: It’s an interoperability protocol that connects blockchains together so they can communicate with each other – think TCP/IP. It also allows for cross-chain transaction, so you can transfer tokens between chains instantly.
Imagine a world where the blockchain ecosystem is tightly coupled together – projects could share data freely without having to worry about being on the same chain, scalability becomes far less of an issue, dapps are created that utilize several different blockchain technologies and they all communicate seamlessly with each other. No longer do you have to chose between tokens that utilize the same blockchain – you can create a dapp that utilizes both of them without any problems at all. Connection speed would become a thing of the past as transfer times between chains would be nearly non-existent.
A secondary purpose is token issuance. It allows you to pool resources by emitting tokens on other chains. So for example, I could create a “DotToken” asset that’s backed by ETH. Anyone holding DOT tokens would be able to claim an equal amount of ETH based on the reserve at any point in time. Ethereum-based tokens would function normally within Polkadot and you’d be able to transfer them back and forth between chains.
How is Polkadot (DOT) doing at the Current Moment?
In the cryptocurrency market, Polkadot is doing pretty well. It’s ranked as number 197 cryptocurrency on the global coin ranking list which positions itself as a relatively successful project with a market cap of over 232 million.
In the last 24 hours, DOT went down by -3.32% against the dollar as well as 2.94% to BTC according to CoinMarketCap. It’s been a while since we could say that DOT is going green but for now, this positive trend seems to be continuing and it doesn’t seem to be stopping anytime soon.
How high can the Price of Polkadot (DOT) go?
Since there isn’t any official estimation regarding the price of DOT in the next few years, we have to guess it by ourselves. As technology is rapidly developing and blockchain has just begun to appear in our lives, it’s quite difficult to predict the price of any cryptocoin. We can only hope that Polkadot would be able to capitalize on this massive opportunity and manage to climb up the ladder to success.
One thing is certain though – DOT has a very bright future ahead if it manages to accomplish what’s been promised by its developers. Just like Ethereum, whose price skyrocketed in the past few months, DOT seems to be exploding with possibilities.
If you’re interested about Polkadot (DOT) you can check their website here, where you can find further information regarding this project.