Polkadot is a sharded, multi-chain network that aims to eliminate the fragmentation seen in the blockchain industry today. The network's native asset, DOT, is used to incentivize participation in consensus, as a medium of exchange and within Polkadot's governance system.
Some of the earliest blockchains remain largely isolated from one another and add blocks sequentially. This creates bottlenecks and congestion, resulting in slower transaction speeds. Polkadot seeks to address this by processing blocks in parallel.
The sharded chains that connect to Polkadot are known as parachains. According to the project's documentation, developers can customize parachains, optimizing them for specific use cases, through the Substrate framework.
Another area in which Polkadot aims to differentiate itself from rivals is through interoperability — i.e., establishing a network of blockchains that can communicate with each other, ensuring that value can be transferred between chains easily.
Polkadot bills itself as "forkless and futureproof." New features can be added to its infrastructure without requiring a hard fork — an often contentious process that involves blockchains splitting into two. This approach could help ensure that Polkadot remains relevant as new technologies emerge.
The DOT token powers the Polkadot network and has several use cases. DOT holders are said to have "complete control" over the protocol, and the token is also used for staking, which creates an incentive for participants to act in the network's best interests. Those who fail to do so incur financial penalties. DOT further serves as a payment method for the fees required to send messages between blockchains.
Separately, DOT can also be staked through OKEx Earn.
DOT is an inflationary cryptocurrency and does not have a maximum supply. As of June 2021, the total supply stood at 1.08 billion DOT. Of these, about 955 million were in circulation.
In August 2020, the cryptocurrency underwent a redenomination that affected its overall supply and the DOT price. Every DOT that was already in existence was divided into 100 "new" DOT. This left existing token holders with a balance that was 100 times greater than before. In turn, the cash value of a single DOT became 100 times lower. At the time, those developing Polkadot stressed that this change wouldn't affect an investor's share in the network.
"New DOT" started trading at around $2.69. Byt May 2021, the DOT price reached $49.69.
Three individuals founded Polkadot: Robert Habermeier, Gavin Wood and Peter Czaban.
Habermeier has a research and development background in blockchains and is described as a "longtime member of the Rust community." Meanwhile, Wood previously served as the co-founder and chief technology officer of Ethereum — and is president at the Web3 Foundation. He is joined by Czaban, who is the foundation's technology director.