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As the crypto market grows, so do the number of blockchains like Solana, Tezos, Cardano, Monero etc, and there is an endless list of their coins and platforms for you to invest in.
Every blockchain claims to offer a unique solution to the blockchain trilemma of decentralisation, scalability and security. However, despite their potential, they remain siloed and are unable to interact with each other. Imagine the number of doors that will open when these blockchains are able to interact with each other.
This challenge is being answered through the concept of interoperability and Polkadot is leading the way in achieving it.
Let’s delve into details.
The name “POLKADOT” perfectly captures the platform’s core mission– connecting all the dots in the blockchain ecosystem.
Consider a large fabric with a polka dot pattern. Here each dot represents different blockchains existing in the ecosystem. Imagine how good it would be if we were able to connect all these dots together with lines!
By connecting these "dots" with lines, Polkadot creates a truly decentralised network, allowing for the seamless transfer of assets, data, and information between blockchains.
Polkadot achieves this through its ‘Relay Chains’ and ‘Parachains’ architecture.
The relay chain serves as the main chain of the Polkadot ecosystem, connecting and coordinating different parachains.
Parachains, on the other hand, are independent blockchains that can run different applications and smart contracts.
These parachains (Moonbeam, Acala, Manta Network etc) connect to the Polkadot ecosystem through the relay chain, allowing for the seamless transfer of data and value between them.
To better illustrate the benefits of connecting to the Polkadot ecosystem, let's consider two blockchains, A and B, which offer different functionalities but are currently unable to interact with each other. By integrating with Polkadot through parachains, A and B can now seamlessly communicate and transfer data and value between each other. For instance, let's say Blockchain A specializes in fast transaction processing, while Blockchain B focuses on smart contract functionality. By connecting to Polkadot, users can leverage both A and B's unique features, allowing for a more comprehensive and interconnected ecosystem that provides the benefits of both blockchains.
Polkadot's well structured model of relay chains and parachains makes it possible to tackle the scalability issue. Since most transactions on blockchains are processed sequentially, it limits transaction speeds. By allowing several parachains to run simultaneously through one relay chain, each para chain processes multiple transactions in parallel and hence removing these bottlenecks in the chain making it more efficient and faster.
Polkadot provides a way for individual blockchains to improve their security by joining together and pooling their security resources. This means that even blockchains with different levels of security can benefit from the collective security provided by the Polkadot relay chain.
By sharing security, each blockchain can focus on its own strengths, such as scaling or runtime, without having to worry as much about security. This also means that there is no need for each blockchain to have its own validator community, as the shared security system provided by Polkadot takes care of this aspect.
At this point you may have this question–
This is where parachains come into action.
Parachains are the spoke part of the hub and spoke model. (For those unfamiliar with this, the hub and spoke model provides a means of distribution that relies on a central location (the hub) and a number of spokes leading out from that hub). The parachains work according to their specific blockchain use case and then return to the relay chain to sync everything up.
Gavin Wood, the founder of Polkadot, describes this process as an office with employees. In an office, everyone will have their specific jobs by themselves, but often, they sync up and coordinate their work with meetings or phone calls. Parachains timely meet with the relay chain to ensure everything is secure and on the same page.
The two main tools that allow Polkadot to change and adapt quickly and thoroughly are its test network, Kusama, and its Treasury.
Kusama is a public pre-production environment for Polkadot, one that allows any developer to experiment and test new blockchains or applications before deploying them on the main network. According to Gavin Wood, Kusama has a live fast, die young attitude and embraces chaos. This doesn’t mean that Polkadot is not reliable or secure, but it recognizes the time and place for experimentation and adaptation. Also, Kusama has real stakes. Since the amount of money and stakes are much lower than the real Polkadot network, it gives people enough incentive not to play around much and try things that they are both ready for the real world and maybe a little risky.
The official Treasury of the network is the fees from the transactions in the blockchains. These funds are used for community building, outreach marketing, security, and software development. Those who want to make changes can use the funds from the treasury by sending a deposit, and then their deposit is refunded if the treasury accepts the changes.
The shared security offered by Polkadot is a massive part of what makes it attractive. Instead of securing the network, funding, and figuring out a million other details, Polkadot sets up Para chains quickly and easily, reducing the feedback loop time. Polkadot is very responsive to new ideas and experiments, making it robust and anti-fragile.
If you're curious about the Polkadot ecosystem and eager to learn how to build on it, we recommend joining our Polkadot Developer Bootcamp.
