POLKADOT: AN INTEROPERABLE DECENTRALIZED WEB 3.0 BLOCKCHAIN | Renesis Tech
What is Polkadot Network?
The Polkadot protocol is a next-generation blockchain protocol that allows multiple blockchain ecosystems to communicate. It brings true interoperability across various purpose-built blockchains by bridging them. Therefore, Polkadot enables the transfer of data between unique blockchains. As a result, it promises to deliver the most robust security, scalability, and innovation.
A Swiss Foundation named Web3 Foundation funds the development of the Polkadot ecosystem. The Foundation’s goal is to facilitate a fully functional decentralized web that focuses on user sovereignty so that data can be kept secure and free from the control of a central authority.
The following pioneers of the blockchain industry have founded Polkadot:
Robert Habermeier
He is into extensive research and development of blockchains, cryptography, and distributed systems. He serves as the co-founder of Polkadot.
Dr. Gavin Wood
He serves as President of Web3 Foundation. In the past, he had also served Ethereum as co-founder and CTO. Solidity, Proof-of-Authority consensus, and Whisper are some of the fundamentals invented by him.
Peter Czaban
An M.E graduate from the University of Oxford, Peter is the Technology Director of the Web3 Foundation, focused on developing the next generation of distributed technologies.
Why is the Polkadot Network Needed?
Currently, the web is centralized. The use of blockchain technology can make it decentralized, but legacy blockchain networks lack interoperability. Polkadot is a next-generation Blockchain that aims to create a fully decentralized web.
The Polkadot ecosystem represents a decentralized web, where a handful of large companies won’t have control over how users interact with technology. This is because they won’t be able to exploit users’ data security or privacy for personal or economic reasons.
The web we use today requires us to agree to certain terms and conditions every time we use it. Most of the time, we don’t even read these terms because we have no choice whether to accept them or reject them. If we want to use an app or web tool, we have to accept the terms levied upon us. As we go on using these apps, we generate piles of valuable data that gives a detailed insight into our personal lives. It means we provide our data for free, holding on to a thin line of trust that the companies controlling it will not manipulate it.
However, development in decentralized technologies like Blockchain and progress in open source has brought in the possibilities of decentralized web systems. A decentralized web can break corporate stranglehold and prioritize individual sovereignty. But despite being one of the biggest technology disruptions, real-world deployment of blockchain technology is still subjected to certain limitations. Most of these limitations exist because blockchain ecosystems function in silos.
Multiple specialized blockchains have demonstrated great promise in fields like the Internet of Things (IoT), governance, finance, identity management, asset tracking, and web decentralization. But the best features of these multiple specialized networks can’t be put together because these networks can’t communicate with each other to exchange data. This design limitation severely hinders the large-scale adoption of Blockchain. Polkadot protocol is a cross-chain solution designed to facilitate blockchain interoperability so that any data can be sent between any blockchains to unlock a wide range of real-world use cases.
What Polkadot Blockchain Network Intends to Offer?
Polkadot aims to connect the dots of various gaps prevailing in the Blockchain industry as a whole. Currently, every blockchain functions as an individual network with specific features and use cases. Polkadot is designed to facilitate the trade-off of these features between multiple chains so that many chains can come together and function as one network capable of a new range of use cases.
The Polkadot network is designed to achieve the concerned goal by facilitating the following:
True interoperability
Some blockchain solutions facilitate the transfer of tokens from one chain to another. But, the Polkadot network is a level up as it enables cross-blockchain transfers of any type of data or asset. Any blockchain can connect to Polkadot and gain the ability to interoperate with a variety of blockchains.
Transactional scalability
Polkadot supports a common set of validators for securing multiple blockchains. It facilitates the smooth spreading of transactions across multiple parallel blockchains, which helps in providing transactional scalability.
Easy innovation
Using the Substrate framework, it is extremely easy to create a custom blockchain. It just takes minutes, and the same chains can be connected to Polkadot for a complete interoperability and security solution from day one.
Forkless and future-proof
Just like applications, even blockchains need upgrades and bug-fixing. Blockchain forking is done to integrate new features or to fix bugs in a blockchain. But Polkadot is a future-ready protocol that doesn’t require any forks to adapt to changes or upgrade itself in alignment with emerging technologies.
United security
Polkadot enables chains to interact with each other, but the chains remain independent in their governance. However, their security gets united, and this improves the overall security of the chains.
User-driven network governance
Every stakeholder has a voice over the Polkadot network. Any upgrades to the network are coordinated on-chain and enacted autonomously.
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How does the Polkadot Network Function?
Polkadot is an open-source network so that any developer can build it, and the web3 Foundation has commissioned hundreds of developers to build Polkadot. As mentioned above, the true advantage or strength of the Polkadot network is that it facilitates the cross-chain transfer of arbitrary data and not just tokens. With this capacity, Polkadot provides a true multi-chain application environment where cross-chain computation and cross-chain registries are possible.
Polkadot supports data transfer across all types of chains: public, open, permissionless, or private and permissioned blockchains. This way Polkadot facilitates various new possibilities in the blockchain space, like a private blockchain-based application can be used on a public blockchain. For instance, of Polkadot, sending a school’s private and permissioned academic records to a degree-verification smart contract on a public chain will be possible.
Now let’s understand how the Polkadot network functions. There are four key elements to it:
Relay Chain
It is the core of the Polkadot network, responsible for managing its shared security, cross-chain interoperability, and consensus.
Parachains
Parachains refer to all those heterogeneous blockchains that are connected to Polkadot. Parachains can have their own tokens, specific functionalities, and use cases.
Parathreads
Parathreads are also similar to parachains but abide by the pay-as-you-go model. These are the chains that don’t require continuous connectivity to the network.
Bridges
Bridges allow parathreads and parachains to connect and interact with external networks like Bitcoin and Ethereum.
In a nutshell, in the Polkadot ecosystem, there is a network of parachains and parathreads connected to the relay chain. They can also connect to external networks using bridges. The relay chain ensures the security of the complete network. Because the relay chain is responsible for the security of the entire network of parachains, parathreads, and bridges, there is a multi-level mechanism to secure the relay chain.
First, there is a group called ‘Nominators,’ whose job is to select trustworthy validators and staking dots(will be discussed shortly). A validator’s ‘job is to stake dots, validate proofs from collators, and participate in consensus with other validators. Collators are responsible for maintaining the shards by collecting transactions from users. Collators produce proofs for validators.
Any bad behavior in the network is to be reported to the validators. Any collator or para chain full node which monitors the network and reports flaws to the validator is called a fisherman.
What is the Role of DOT (native token) in the Polkadot Network
DOT is the native token for the Polkadot network. It carries out three main functions:
Governance of the network
The governance function includes determining the network’s fees, fixing the auction dynamics, and scheduling the addition of para chains. Only DOT holders are entitled to participate in governance.
Operating the network
DOT also facilitates the consensus mechanism that underpins Polkadot. DOT holders need to put their DOTs at risk, also referred to as staking for carrying out transactions across parachains. DOT staking acts as a disincentive for malicious participation in the network. Token holders are awarded for good transactions, while they lose their stake in the network for the faulty ones.
Creating parachains by bonding DOT
DOT holders require getting their DOTs locked for adding new parachains through a process called DOT bonding. It works as a form of proof of stake. Outdated or non-useful parachains are removed by removing bonded tokens.
Endnote
Polkadot is 100% open source, and it profusely encourages developers to participate in the Polkadot ecosystem building. Our developers have already started exploring development scope and service feasibilities over the Polkadot network. From smart contract to dApp development, custom Parachain development to node and wallet creation, our team offers a wide range of Polkadot blockchain development services to help you leverage interoperability, interchain connectivity, and instant security of Polkadot.
If you are looking for ways to improve the cross-chain capacities of your blockchain solutions or want to get your hands on interoperable blockchain applications, then reach out to?Renesis Tech. We will help you get the right solution with Polkadot.
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