How Does Polkadot Become A Top Ten Crypto Contender? A Deep Dive Into It
All you needed to know about Polkadot. How is it faring in terms of market capitalisation? Is it a matter to be discussed in the blockchain scenario?
A new project called Polkadot joined the top ten crypto coin list almost immediately after the project officially launched just recently. In terms of market capitalisation today, the Polkadot network is the sixth-largest blockchain. Some crypto proponents speculate it will be amongst the top three market caps shortly as the blockchain is considered an Ethereum competitor by a few individuals.
As the Polkadot (DOT) blockchain has recently joined the leading ranks, crypto proponents have noticed a new top ten crypto-challenger in the world of digital assets. Wondering how this coin made it into the top ten so quickly is several people who have never heard of Polkadot.
The developer has worked on the protocol for the last four years as the project was conceived by Ethereum co-founder Dr. Gavin Wood. With a lot of hype behind them, it was one of the three blockchain protocols (Dfinity, Filecoin) as the project stemmed from the initial coin offering period.
Noting that the protocol is a heterogeneous blockchain was the Polkadot project’s light paper.
The light paper further details that allowing them to operate seamlessly together at scale, Polkadot is a next-generation blockchain protocol uniting an entire network of purpose-built blockchains. With security guarantees, it connects several chains in a single network allowing them to process transactions in parallel and exchange data between chains.
Sharding In The Context Of Polkadot
Any type of arbitrary data is possible to traverse across Polkadot’s multi-chain application environment like real-world assets and tokens essentially. Which is an aggregated set of validators that leverage heterogenous shards, any blockchain can join the Polkadot infrastructure.
For quite some time, heterogenous sharding has been discussed within the blockchain development community. Nodes essentially hold their shards of data as sharding is breaking up the workload peer-to-peer nodes deal with. Shared amongst the network of nodes in every shard.
Heterogenous sharding allows every chain to remain unique as traditional sharding techniques with the network offering interoperability between multiple chains.
Including the main relay chain (Polkadot blockchain), parachains, and bridges, there are three main parts to the Polkadot network. Everything is secured by the main Polkadot Relay Chain as the parachains are made up of the heterogeneous blockchain shards.
Thereafter it is observed that parachains can mint native tokens, transfer tokens, and also connect to external chains via bridges. To communicate with blockchains like Ethereum or Bitcoin bridges leverage Polkadot shards. A start-up called Interlay plans for instance to create a tokenised BTC product called PolkaBTC on the Polkadot blockchain.
Details Of The Polkadot By Interlay Team
The interlay team details that for a trustless bridge from Bitcoin to Polkadot: the BTC parachains, Interlay has released the proof-of-concept. The use of it across a wide range of applications including decentralised exchanges, stable coins, and lending protocols, once online users will be able to mint 1:1 Bitcoin backed assets onto Polkadot the so-called PolkaBTC.
Further adding the team says
The only cross-chain framework that is financially trustless, permissionless, and censorship-resistant and backed by top tier research is the Under the hood, the BTC- Parachain implementing XCLAIM.
A great number of people have been waiting for the project to unfold since Polkadot was first announced. Thinking that Polkadot will someday be a top-three market cap contender in the future is the Asia based digital asset fund, Spartan Black.
Spartan Black recently tweeted that on Coingecko/CMC, within a year DOT will be top 3 market cap. Continuing to say that Polkadot was arguably the most important crypto project since the launch of Ethereum in 2016 was the fund manager.
Further noting Spartan Black wrote:
It can be considered as ETH2.0 without all of the activity that Ethereum currently has yet.
There have been several criticisms against the Polkadot project as well with all the hype swept aside. Writing about Polkadot’s promises as well as some of the project's problems as well, was Tom Shaughnessy the cofounder of Delphi Digital.
Polkadot According To Delphi Digital Executive.
It was highlighted by Shaughnessy on how the Polkadot with a rocky history was born from members of Ethereum particularly Gavin Wood thereby itching to implement sharding right away.
Also noting how Polkadot’s parent the firm Parity also had a rocky history was the Delphi Digital executive. He further details how the voting on Polkadot would face hurdles as well as how Polkadot’s council of 6-24 people could be a centralisation risk for the entire network.
During the last few years, it was reported on several Parity’s blunders.
Polkadot is the sixth-largest blockchain in terms of market cap as the native currency trades for a touch over $4 per coin at the time of publication. Giving the project an overall valuation of $3.6 billion today as market data shows there is over 852 million DOT in circulation.
Swapped with tether is over 80% of the DOT being traded on September 23. BTC (13.4%), USD (1.9%), TWD (1.2%), EUR (1.2%) and BUSD (0.7%) are the pairs that followed. Only representing 0.65% of DOT trades on Wednesday was the Ethereum trades.