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What is Polkadot? What to Expect from this Cryptocurrency?
02/06/2023
What is Polkadot? What to Expect from this Cryptocurrency? Smart contract systems gave what to talk about in 2021, but is there a promising future for this Blockchain? Find out by reading below.
What is Polkadot? What to Expect from this Cryptocurrency?
What is Polkadot?
Polkadot (DOT) is a Smart Contracts Cryptocurrency and was conceived and created by Gavin Wood - co-founder of the famous Ethereum: the largest token and NFTS creation platform in the cryptocurrency market. At first, Gavin and Vitalik (owner of ethereum) disagreed on some points - so he made the decision to abandon Vitalik and start the creation of Polkadot.
Incredibly, it is such an "old" project in the crypto world and it began to be developed in 2016, shortly after Gavin left Ethereum. Since he knew some of Ethereum's flaws - essentially about Scalability and Mining, he soon started working on possible "solutions".
From this, DOT was born, which today, along with Ethereum, Solana, Cosmos and Cardano, are the main smart contract platforms on the market. Polkadot's strong point is undoubtedly the ease of communication with other smart contract platforms and no other network has such facilities.
Polkadot is a layer 0 cryptocurrency (and if you don't understand this concept, we recommend that you read this article to better understand what it is about). And with that, from this creation platform, users and companies will be able to build their projects within DOT.
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How does Polkadot work?
You already know what Polkadot is, but in short, how does this Cryptocurrency Work? What is the problem that DOT solves? Generally speaking, polkadot is a build platform and uses "open source" to make the protocol itself "democratic" in the eyes of the user.
Within the polkadot ecosystem, there is a unique concept called "parachains", and they are projects that allow this blockchain to interact with other blockchains, be it ethereum or solana... at the moment, the most famous Parachain is Acala - which is a decentralized financial network where there is a stablecoin called aUSD, very similar to USDC from ethereum.
Polkadot DAOs are the most interesting and democratic on the market! DAO, in a general way, means: Decentralized Autonomous Organization and that's where the users rule! Unlike a company where the CEO makes the decisions.
What is the Future of Polkadot?
Polkadot seems to have not only an interesting but also a bright future - considering that the project started as an "improvement" of Ethereum. If indeed, all of founder Gavin Wood's ideas come to fruition and are implemented, it could send DOT Price to the moon; but the truth is that many cryptocurrencies promise to be the "new ethereum", but in practice, this is not what happens.
The project is very good and has incredible growth potential. Today, polkadot is already a reality and has a high-level infrastructure, one of the biggest problems of this network - along with Kusama (which is its exclusive version for testing) - is adoption. At the moment there is no way to compare it with Ethereum, as it is still much smaller not only in market value, but also in structure.
What is the Future of Polkadot?
As we can clearly see in the Polkadot Chart, the asset has devalued a lot in the Dollar pair and could devalue even more if the economy does not stabilize in the coming months and years. We are going through a bear cycle and the cryptocurrency market has never experienced a global recession.
This could be a real test for DOT, after all, if Blockchain goes through this very delicate market moment, the asset may never return to these price ranges, and, if the cryptocurrency price not only returns to previous levels, when it surpasses them (which there is potential), it could be very profitable for the long-term investors who are planting their seeds now.
But of course, as we like to make clear here on the Bitcoin Lovers website is: we do not make investment recommendations! You, investors of all sizes, have free will and the power of "self-responsibility" in your hands, so you should know what to invest in and, above all, what not to invest in.
This is a project we invest in, but always with good risk management! In the cryptocurrency universe, Bitcoin is sovereign and should always be its highest position.
Lucas Lippe
The idea of freedom is fascinating and Bitcoin gives us that in many ways. Explaining ideas of a decentralized web on the Bitcoin Lovers website.