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What is Polkadot (DOT)?

Polkadot is a blockchain network that can be described as a chain of blockchains or multichain. Polkadot is difficult to define because it is a one-of-a-kind object; therefore, we must first comprehend its structure.

A team led by Gavin Wood, the former CTO of the Ethereum project, is in charge of maintaining the project.

Relay chains and parachains are the two primary structural components of the Polkadot multichain. Everything relies on the relay chain. It is in charge of the entire network’s security, consensus, and cross-chain interoperability, and its functionality is intentionally limited. Smart contracts, for example, are forbidden.

Validators on the Relay chain, like any other blockchain, are staked with DOT – Polkadot’s native currency – in order to achieve consensus through Proof of Stake.

Everything relies on the relay chain. It is in charge of the entire network’s security, consensus, and cross-chain interoperability, and its functionality is intentionally limited. Smart contracts, for example, are forbidden.

Validators on the Relay chain, like any other blockchain, are staked with (DOT) Polkadot’s native currency in order to achieve consensus through Proof of Stake.

Parachains can disconnect and reconnect to the network, whereas relay chains are permanent. The connection is established on a subscription basis, similar to how you pay Netflix monthly to watch its content and polkadot are blockchains that run indefinitely and rent space in the Polkadot network by locking funds for the duration of the lease. The pay-as-you-go model is used by Parathreads. Parathreads are blockchains that must be activated and run on a less frequent basis.

Why do traders use it in trading?

Traders buy Polkadot(DOT) for holding it up and trade it when the price gets higher. Also, traders use Polkadot for transactions, payments, lending, exchange, and yield aggregators.