Despite the crypto winter, many investors still think there is plenty of room for growth in the cryptocurrency market. For instance, they think that the rise of blockchain technology will benefit Polkadot. Based on its market capitalization, which is around $7 billion, Polkadot is one of the top 15 cryptocurrencies.
What is Polkadot?
Gavin Wood, the founder of Ethereum, created the platform’s protocol known as Polkadot in 2016. One of the reasons people like to buy Polkadot is because it’s designed to connect various blockchains. Through its protocol, it’s designed to allow cross-chain interoperability. For instance, it can link the communications between multiple blockchains.
The scalability and interoperability of blockchain technology are some of the issues that have been raised by the platform. With the help of its protocol, other blockchains can now talk to each other.
According to experts, the platform can process over a thousand transactions per second, which is faster than Bitcoin and Ethereum. This is impressive considering that Bitcoin only processes around seven transactions per second.
With the help of its protocol, Polkadot could potentially expand the usability of various cryptocurrencies. According to Hammoud, the founder and CEO of National Digital Asset Exchange, the company’s goal is to allow both Ethereum and Bitcoin to interact with each other securely. For instance, if a person wants to buy a house, they could use Bitcoin to secure a loan through an Ethereum dApp.
The native token of Polkadot is known as DOT, and it’s used for various functions such as governance and bonding. For those looking for passive income, staking can be a great way to earn money from your cryptocurrency.
All users of the platform are allowed to vote on the various governance decisions that are made on the platform. However, their votes are only weighted according to the number of tokens they have.
Initially, it was only allowed to create 10 million DOT tokens. In August 2020, the network’s redenomination resulted in the creation of a total of 1 billion DOT tokens.
Where to Get Polkadot?
You can easily buy and sell DOT tokens through a variety of decentralized exchanges such as the 1Inch Network or the PolkaSwap. You can also use fiat currencies such as U.S. dollars to buy Polkadot.
Some Exchanges that Will Allow DOT Buying and Selling:
•Bybit
•Coinbase
•Kraken
•Binance.US
Some cryptocurrency exchanges allow customers to trade USDC for DOT on their platform. Other platforms allow investors to trade USDC and DOT. These exchanges include KuCoin and Bybit.
How to Purchase Polkadot?
To buy Polkadot tokens, follow these three easy steps:
1. Select a Crypto Exchange
If you’re new to investing in cryptocurrencies, then you’ll need to open an account with a digital asset exchange. These are marketplaces that allow investors to trade various types of assets. Some are relatively easy to use, while others have features such as crypto staking and margin accounts.
Before you sign up for an exchange, make sure that you’re getting the best possible service. Aside from the platform’s security features, other factors such as its fees and minimum account requirements are also taken into account.
2. Submit Your Order
You can fund your account with your bank or debit card. Some exchanges will allow you to use credit cards, but they will typically charge a higher annual percentage rate and consider a transaction as a cash advance.
Although you may be able to use a credit card to purchase DOT, it is not recommended due to the high transaction fees that are typically charged on exchanges. Doing so will result in you paying higher interest rates and will generally result in a cash advance instead of a regular fee. When you are ready to make a purchase, enter the DOT ticker symbol and select the amount you want to buy, such as $100 or $200.
3. Store Your Polkadot
One of the most important steps that you should take when it comes to investing in cryptocurrencies is to properly store your assets. Doing so will allow you to keep your investments safe. There are various types of storage options that you can choose from.
A hard wallet is a type of device that’s commonly used to store various types of cryptocurrencies. It’s a small, physical device that can be plugged into your computer and used to store your private keys.
Another option for storing your Polkadot is with a paper wallet. Although the paper wallet is less popular than its predecessor, it can still be considered a viable option. With a paper wallet, you can keep track of all of your assets by downloading a QR code.
The third option is using a software wallet. This is a type of device that’s commonly used to store cryptocurrencies. It can be downloaded and used to manage your investments. Although it’s less secure due to its connection to the networks, it’s still very convenient to trade your assets.
Some exchanges, such as Coinbase, will typically offer built-in storage for your cryptocurrency. However, relying on this type of service can be risky, and you should consider other options.
Where to Make Purchases with Polkadot?
The Polkadot token may be used as a governance token. Anyone holding DOT tokens can offer input into the protocol. Polkadot may also be utilized for staking. This is used to verify transactions and issue new tokens. The price of the protocol token can be volatile. Before you make a purchase, it’s important to understand the risks associated with it.
If you’re new to the cryptocurrency industry, it’s important that you thoroughly research the various projects that are currently in development. There are many opportunities in this space, and you should always remember that it’s still young.
