Polkadot is a protocol that aims to enable communication between different blockchains. The idea of an interconnected decentralized internet has been well received in the crypto community, and in 2021, DOT is showing a positive price dynamic. In this article, we will describe in simple terms how Polkadot works and what its native token DOT is. At the end, you will find a quick guide on buying DOT without registration.
How does Polkadot connect blockchains?
Currently, all blockchains exist separately from each other: their protocols are different and don’t allow for direct value and data exchange. As a result, we have distinct ecosystems connected only with things like Wrapped Bitcoin (WBTC) — an ERC-20 token that represents Bitcoin’s value on the Ethereum network. The founder of the latter Vitalik Buterin even called this embarrassing:
So how would the crypto world look like if all the coins were interconnected? What if we could bring together Ethereum with Cardano and Bitcoin with Binance Chain?
That’s what Polkadot has been working on in recent years: cross-chain interoperability where blockchains can communicate in a trustless manner. This will allow an Ethereum-based smart contract to trigger a Bitcoin payment, and a cross-chain swap between Litecoin and XRP will be possible. Polkadot, frequently dubbed as “the internet of blockchains,” was launched in 2016 by Gavin Wood, an Ethereum co-founder with Ph.D. in software engineering. One of the things Wood is famous for is the invention of Solidity — the language that Ethereum smart contracts are written in.
Polkadot unites blockchains with its Relay chain, parachains, and connectors called bridges.
The Relay chain is the key Polkadot network layer, a bookkeeper that tracks all the transactions going on between blockchains.
Parachains are a second level. They include individual user-made blockchains that run in parallel with the relay chain and benefit from its security, also allowing for the increased scalability. Crypto companies can buy parachains, easily set them up, and customize them according to their needs. Besides blockchains’ interoperability, this is the second main use case of Polkadot.
Bridges were designed by Polkadot to connect to established blockchains like Ethereum or Bitcoin. Break-in and break-out smart contracts will help Polkadot communicate with these networks.
What is the DOT token?
DOT is the native token of Polkadot. It allows for governance, staking, and bonding.
Governance. Users use DOT to vote on the network upgrades, new features, and fees. Votes are weighed by token amount: the more DOT you have, the more you can contribute to the community decisions. The governance model helps Polkadot upgrade without forks.
Staking. Polkadot Relay chain is based on the Proof of Stake consensus mechanism, and users stake DOT to help secure the network. Stakers are nominators who select validators — those who mint blocks. There are also fishermen who detect and report malicious validators for a reward. Collators link parachain transaction data with the Relay chain.
Bonding. To buy a parachain and control it, you need to “bond” some DOT. Bonding ties the tokens to the relay chain when a new parachain is launched.
Polkadot aims at building the multichain universe where all blockchains could operate together. This may bring us to the Web3 — decentralized internet. The community hailed such a vision: during the last year, Polkadot soared to the Top 9 position by market cap ($17.7 billion as of August 2021).
How to buy Polkadot?
If you consider buying Polkadot, try ChangeNOW. Here, you can do this without registration, KYC, and hidden fees just within a few minutes. Buying DOT is possible for over 200 crypto coins.
Here’s the quick guide:
- Use the calculator to see what rate we offer. All fees are already included in the estimated rate. The ultimate amount you will get may only be different if the coins’ prices change during the time of the swap (which is, however, 5 minutes on average).
2. Enter your DOT address. You can also change the amount here if you want.
3. Check the details and confirm:
4. Now, send the specified amount of crypto to the address provided. If you’ve got a mobile wallet, scan the QR code, and the sum and address will paste automatically. After you deposit, the exchanged sum will land in your wallet in a few minutes.
No registration and KYC for crypto-to-crypto exchanges. No emails and passwords — swap crypto in a few clicks.
No hidden fees. All fees are already included in the estimated rate that you see in the calculator. To learn more about our fees, see here.
No custody. You don’t need to store crypto on our platform to exchange it. Deposit the sum you want to swap, and we will send you the exchanged amount right back.
It’s fast. An exchange takes 5 minutes on average.
No upper limits. In most of the pairs, you can swap as much as you want. The lower limit for each is a few US Dollars.
Buy Polkadot with a credit card
You can buy DOT with a credit or debit card on ChangeNOW. Click the “Buy/Sell Crypto” tab in the calculator and choose one of the dozens of available fiat currencies:
After you click “Buy”, you will be offered to choose between 3 different partner fiat provider services. After you select the one with the best rate, make sure it’s really the best one taking into account the fees.
If this is your first time buying crypto on ChangeNOW, you will need to pass a KYC check — the docs are verified automatically, and normally, it won’t take you more than 5 minutes. Once you’ve used a service, you won’t have to do any more KYCs in it. You may be asked for a new KYC in Guardarian, but in return, they are registration-free which eliminates the login-password hassle.
The future of the decentralized internet?
Many enthusiasts see the future of the internet as decentralized: the services that people use are based on immutable blockchain that no governments or corporations can affect. Developing the distributed ledger technology was the first step towards this world, and now, there is the need to connect the platforms that have been built. This is what Polkadot does. Its efforts have been appreciated by the community, which is reflected in the DOT price. In case you share this vision and see DOT as a good investment, buy some without registration on ChangeNOW.
If you want to learn more about crypto projects that contribute to the idea of a decentralized internet, discover Storj, the decentralized file storage.