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scalability scalability
True interoperability True interoperability

Polkadot is an ambitious, upcoming multi-chain framework platform — designed to facilitate interoperability and scalability of blockchains.

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What is Polkadot?

Polkadot is an innovative network that links different blockchains.
The network of chains operates side-by-side on the relay chain, and they are able to transmit messages to each other. These chains are known as parachains which combine safety while being able to operate totally arbitrary state-transition functions. This helps them to be completely different, yet to be able to interact with each other. In other words, separate blockchains can exchange messages and transactions in governance, scalable, and interoperable framework without trust, that produces a fully decentralized dApps and tools ecosystem. Polkadot enables cross-blockchain transfers of any type of data or asset. It is a project founded by Dr.Gavin Wood, who is also a co-founder of Ethereum.

How does Polkadot work?

Polkadot network works with the help of three separate chains which allow it to solve issues of both interoperability and scalability:


The Relay Chain – Polkadot ensures a relay chain, the so-called bedrock on which parachains can operate interoperable, instead of a single chain for all dApps.


The Parachain – Multiple parachains are hosted upon the relay chain. They function as complex data structures that are hosted side-by-side. Parachains are independent blockchains that accumulate and process their own transactions.


The Bridge Chain – Other blockchains can interact with Polkadot network via so-called bridge chains, that provide Polkadot network to be linked to the Bitcoin, Ethereum, and several other blockchains, wherein each blockchain maintains its consensus mechanisms and terms.

Smart contracts ensure that all transactions between individual chains are carried out faithfully. Parachains solves the problem of scalability by processing transactions in parallel. There is a limited number of parachain slots. To ensure fair, there take place so-called auctions, where everyone can compete for a parachain slot. Parachains have a restricted existence lifetime, but a current parachain may take part in auctions again in order to prolong their "lifetime".

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Shared security is one of the key ideas on Polkadot network. Security resources shared within Polkadot network. This allows individual chains to leverage collective security. A tree-like structure of blockchains is another scalability approach proposed by Polkadot team. Defective parachains may be disabled. Once a parachain leaves Polkadot network, it is become a solo chain and can’t continue to benefit from Polkadot’s pooled security.

Existing blockchains process transactions in a one-by-one principle and their scalability is very limited. They typically have a low throughput limit but Polkadot solves this issue by bringing forward a multiple parallelized transaction method, as several parachains can operate side-by-side in order to process multiple transactions in parallel. According to Polkadot light paper, this allows the network to achieve infinite scalability.

Polkadot Network

Polkadot introduces a Nominated Proof-of-Stake (NPoS) consensus algorithm, where multiple participants act together as part of Polkadot’s pooled security.

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They stake their DOT to approve or demonstrate support for a validator candidate. If a validator is chosen, the nominator who has staked DOT in favor of that validator will also receive a share of their rewards (or penalties). Being a nominator is simple and it a low-risk source of a passive income.

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A validator is responsible for protecting the relay chain by staking DOT. They check the transactions that take place on the various parachains, and validate the proof from so-called collators in the form of blocks, transactions, and messages. They are especially crucial to the system as they allow it to move forward and develop. To ensure the proper conduct of the validators, they are assigned to a different parachain on each block.

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They're working with validators. Collators are assigned to a specific chain, where they collect parachain transactions, bundle them into a block, and generate state transfer proofs, to be verified by the validator. They rewarded by being able to receive parachain-specific transaction fees.

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They check for misbehavior and get rewards on the network without generating blocks.

DOT Token

DOT token is the native token of Polkadot that purposes specifically for Polkadot platform. The DOT token serves 4 different purposes:

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Governance over the network: DOT holders can manage forkless protocol enhancements and improvements as well as engage in parachain decision-making processes and more.
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Operation: Good actors are rewarded and bad actors are forced to lose their stake in the network.
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Interoperability: DOT tokens are used to pay for validators' fees when transmitting messages from one network (blockchain) to another.
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Bonding: new parachains are added by bonding tokens and old ones are removed from the network by deleting bonded tokens.
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