Polkadot (DOT)

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Headquarters Zug, Switzerland
Key People Gavin Wood, Creator
Twitter @polkadot
Website Polkadot Homepage
Blog blog

Polkadaot (DOT) is a protocol for interoperating blockchains.[1] Polkadot was founded by the Web3 Foundation.[2]

Gavin Wood, creator of Polkadot, wrote in a blog post on July 16, 2019, that an experimental, early version of Polkadot called Kusama would be launched in Summer 2019 to provide a test environment. Kusama has its own native token, the KSM, which is distributed along with the issuance of DOTs, Polkadot's native tokens.[3]

DOTs are the first tokens to be offered in an initial futures opening (IFO)by CoinFLEX. An IFO is a presale of tokens before they are issued where CoinFLEX organizes and publicizes both the primary and secondary trading of the tokens before they are issued on the blockchain.[4] The DOT IFO was scheduled for July 17, the day after Wood's blog about Kusama.[5]

The first candidate, "CC1," for becoming the Polkadot mainnet launched in May 2020. “There could be more than one chain candidate before it officially transitions to mainnet,” said Peter Mauric, head of public affairs at Parity Technologies, a consortium of blockchain engineers led by Wood.[6]

In August 2020, Polkadot released a testnet of a "parachain" protocol called "Rococo," which was designed to allow for communication between multiple protocols.[7]

In December 2020 Tidal Finance, an insurance startup based on the Polkadot blockchain, raised $1.95 million in seed funding. Tidal's team said they chose Polkadot because the nature of its blockchain would eventually allow for greater sources of liquidity through other protocols, meaning more customers would be able to buy insurance using digital assets.[8][9]

In January 2021, Polkadot overtook XRP to become the third-largest non-stablecoin cryptocurrency by market cap. This was largely due to a massive XPR selloff triggered by a lawsuit against Ripple by the U.S. SEC.[10]

Exchange-traded product manager 21Shares announced in early February 2021 that it would list a single-asset ETP on SIX, the Swiss stock exchange, based on DOT. Like Polkadot, 21 Shares is located in Zug, Switzerland.[11] It is a prominent cryptocurrency ETP sponsor, active on European stock exchanges.[12]

"Snowfork" and Interoperability with Ethereum[edit]

A software development team called "Snowfork" is working on a "bridge" that will allow the Ethereum and Polkadot protocols to function interoperably (allow the code of the two independent protocols to interact with each other). If successful, this project would allow developers to create features - such as exchange of value/currency - between Ethereum and Polkadot's core protocols.

In late August 2020, a developer from Snowfork said the project will likely launch in mid-September of 2020.[13]

Project funding[edit]

Polkadot is funded through the sale of DOTs, $145 million worth in 2017 and $43 million worth in 2020 plus another 500,000 DOTs at an undisclosed price per token during 2019.[14]