Polkadot is the next iteration in blockchain technology. The aim is to solve current blockchains such as scalability, governance, conductivity for various applications by giving developers the freedom they need with security that old chains cannot provide.
Furthermore, Polkadot will allow custom configuration so that each chain can have its own set rules (see below) and thus will be able to achieve different objectives, e.g., having a highly scalable/low-cost network or an immutable but centralized network.
Polkadot will be developed by the Web3 Foundation, a non-profit organization based out of Berlin, with their team being made up of Parity Technologies (the company behind this year’s biggest move in the Ethereum ecosystem – implementing the Byzantium hard fork on time) and Brainbot labs. All three are highly regarded for their work in the blockchain space, including Parity’s contributions to Ethereum.
A Multi-Chain Network
The main aim of Polkadot is to create a network where you can use different blockchains together so that they can communicate with each other and allow all sorts of different use cases. This new infrastructure is aimed at developers to experiment without having to make any changes to their own blockchain.
Polkadot aims to achieve this by solving scalability and governance in a different way than today’s blockchains do. Polkadot is not a blockchain itself; it is intended to allow all other chains to connect to it and thus interact with each other and take advantage of its features (or lack thereof).
By being a multi-chain network, any given chain can have its rules superseded by higher-level chains and have access to more functionality that otherwise would be difficult/impossible for them to implement independently.
What you need to know
If you were pondering “Where can I buy Polkadot?” then this piece is for you to understand the risks and technicalities before your purchase. Polkadot will allow anyone to create their own chain, which can have its own ruleset (e.g., if you wanted immutability but were unwilling to pay higher transaction fees).
This would make it possible, for instance, to create an immutable network with a very low cost of transactions or use multiple blockchains at the same time with different governance models.
This allows complex interactions between these separate chains, e.g., where one particular chain serves as regulatory laws/rules for another without having to fork both and put unnecessary strain on the ecosystem; this is known as cross-chain bridges.
There will also be specialized governance protocols that will highlight security issues and thus the most pressing concerns at any given time, which can then be voted on by the community.
And of course, these chains will be independent; they will have their own nodes, miners, etc. so that they can operate independently and securely without relying on other chains (if, for instance, one chain were to suffer an attack/hack; it would not affect the others) or having anyone in charge of them.
The foundation’s website also mentions atomic swaps or decentralized exchanges as a possibility with this infrastructure; however, I could not find any official confirmation regarding this.
It is potentially possible, though, due to Polkadot being a multi-chain network where different blockchains could be accessed through the same network, e.g. if you wanted to trade one token for another but did not have much traffic on your chain. You could trade it for a more widely used currency (like Bitcoin) through the network.
Order of Chains
The order in which the chains are linked together is important as certain protocols may be required before others, and thus if there were a need to change them later, this would potentially break something further down the line.
In polka dot, all new chains will start with no connections to other chains, and the system will decide through democratic protocol execution whether or not they are ready to connect.
This means that all the chains are treated equally compared to today’s hierarchical model where ethereum/bitcoin has an advantage over others due to users being able to send transactions across their own chains for free; this means that they can remain as the main chain with no incentive to ever switch to a different one.