Crypto clock | Polkadot, the sleeping giant?

Polkadot is ready To be woken up and to follow the rest of the “Ethereum killers”?

In the past few weeks we’ve seen how many of the cryptocurrencies hailed as “Ethereum killers” have seen impressive returns, largely due to Ethereum’s recent network upgrade, which did little to alleviate high transaction fees and network congestion.

Ethereum has been a victim of its own success as higher network usage came with higher fees and slower transaction speeds.

Will Polkadot catch up with these “Ethereum killers” or is it just quietly building an empire in the shadows?

What is polkadot?

At the moment, blockchains fall into one of two main categories. They are either specially designed and designed for a very specific function, like Bitcoin, which was specifically designed as an alternative payment system and store of value.

Or they can be more open and general in function and applied to a wide variety of applications, like Ethereum or Cardano, which can be used to create decentralized applications (dApps) – blockchain-based versions of regular apps like the one you walk on your phone.

On the other hand, Polkadot is a blockchain that provides an environment on which other blockchains, so-called “parachains”, can run. It essentially provides the infrastructure with which other blockchains can safely interact with one another.

Polkadot was developed with one goal in mind: to unite an entire network of blockchains, from Bitcoin to Ethereum

Polkadot was designed with one goal in mind: to unite a whole network of blockchains, from Bitcoin to Ethereum to all the other cryptocurrencies you’ve never heard of.

As things stand at the moment, developers have to choose which blockchain they want to build their applications on. Each chain is unique and has its own strengths and weaknesses that developers have to weigh up when developing. Ethereum, for example, has a large network that is robust and easy to use but is relatively slow and expensive, while competitors like solana are designed to prioritize scalability.

The problem: blockchains cannot talk to each other

To understand what Polkadot is and why it holds so much promise, we first need to outline one of the biggest problems in the blockchain and crypto space: blockchain interoperability. Blockchains can’t really communicate with each other, which limits the entire crypto narrative of “building the financial world from scratch.”

If you decide to develop on Cardano you will not be able to interact with the Ethereum blockchain and therefore you will lose the great ecosystem that Ethereum has to offer.

This is where Polkadot intervenes and enables different blockchains to work together seamlessly. Polkadot allows developers to customize the specific features they want, giving them the flexibility to choose the parts of the Polkadot network that fit their project and stay away from the parts that don’t. Additionally, it allows your project to work across multiple blockchains so that you are not limited to just the blockchain on which you built your project.

Simply put, Polkadot acts as a framework for any blockchains that log in, much like HTML allows websites, browsers, and servers to interact with each other. The idea is to take care of messy and costly cryptocurrency mining processes (including transaction validation and security logs) and allow developers to focus on building blockchain-based apps.

Ready to go?

Many had hoped that last month’s much-anticipated upgrade would solve the problem of Ethereum’s high transaction fees, but all evidence points to the opposite. Since the high fees and network congestion of Ethereum have still not been resolved, many competitors (the “Ethereum killers”) gained momentum in August.

Ethereum is clearly feeling the pressure. In the past five months, we’ve seen Ethereum lose over 20% of its dominance in the smart contracts crypto category. This means that for the first time, developers are not only looking for alternatives to Ethereum to build their apps, but also actively using them faster and faster.

The graph below shows how Ethereum and its competitors have fared since their all-time highs in May:

From the “Ethereum killers” we can see that solana has outperformed, almost doubling since its previous all-time high, while Polkadot is the worst performer as it is still 39% below its record high.

While all “Ethereum killers” have recovered to near all-time highs or higher, Polkadot is still lagging behind.

Will the sleeping giant wake up?

It seems like it just happened! The recent hype surrounding the Polkadot “Parachain” auction has brought the cryptocurrency to life and awakened this multi-chain giant.

How does polkadot create value?

  1. Solution for blockchain communication: Blockchains act as separate data islands with few possibilities to use the information of the other networks. Polkadot eliminates these concerns with its “multi-chain” network, which enables information transfer between blockchains. This is a valuable function that will be increasingly used by blockchain technologies in the future.
  2. Solve scalability: Bitcoin only processes between three and five transactions per second and Ethereum between 10 and 15. In the context, Visa processes 1,700 transactions per second. This points to the scalability problem that both cryptocurrencies are facing. But polkadot is a winner in terms of scalability: it should be able to process up to a million transactions per second!
  3. An easy way to create custom blockchains: Polkadot allows users to build their own blockchain from scratch with a range of features while also giving them the freedom to customize whatever they need. Custom blockchains can be created in minutes, giving users access to the security, scalability and interoperability of polkadot. You are also not limited to writing your blockchain logic in a polkadot-specific language, as it accepts multiple languages.

Where do I buy points?

Crypto investment platform based in Cape Town Revix, which is backed by JSE-listed Sabvest, has just added Polkadot to its crypto product offering with an enticing royalty-free promotion.

Revix will not be offering purchase fees on Polkadot purchases for one week from September 3 to September 9, 2021.

You can also access ready-made “crypto bundles” via Revix. With these bundles you can effortlessly own an equally weighted basket of the world’s largest and most successful cryptocurrencies by default without having to build and manage a crypto portfolio yourself. They’re like the JSE Top40 or S&P 500, but for crypto.

More information is available at www.revix.com.

About Revix
Revix brings simplicity, trust and great customer service to investing. Its easy-to-use online platform allows anyone to securely own the best investments in the world with just a few clicks. Revix guides new customers through the sign-up process through to their first deposit and investment. Once set up, most customers manage their own portfolio, but can always access the support of the Revix team.

Disclaimer of liability
This article is for informational purposes only. The views expressed are and should not be construed as investment advice or recommendation. This article is not an offer or a solicitation of an offer to buy or sell any of the assets or securities referred to herein. You should not invest more than you can afford to lose and, before investing, please consider your level of experience and investment goals, and seek independent financial advice if necessary.

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