Explaining cryptocurrencies: What is Polkadot?

Polkadot (DOT) is one of the fastest-growing cryptocurrencies in the world. 

By market capitalisation, DOT has already become the 6th largest crypto in the world, with market cap totalling $7bn. That puts it ahead of established cryptos like EOS, Bitcoin Cash, and Cardano. It was created in 2017 and launched in 2020 by a team that includes Dr Gavin Wood, one of the founders of the Ethereum project (another digital payment platform/cryptocurrency). 

Polkadot itself is a blockchain platform aiming to become the standard platform for all blockchain-related programmes and transactions going forward. DOT is the currency used to process transactions on Polkadot. 

According to Polkadot co-founder Gavin Wood, Polkadot is the second most used token in the decentralised finance infrastructure.  

It has plans for major expansion with future projects allowing developers to build more apps and blockchains with the Polkadot protocol. It also has plans to integrate with other platforms like Ethereum to improve accessibility for DOT coins.  

DOT prices 

Polkadot has exhibited positive price movements recently, like several other cryptos following the Bitcoin surge in 2020.  

In January 2021, DOT was up 130% against December’s $4.50.  

At the time of writing, DOT was trading around $7.90.   

Investors are optimistic towards Polkadot because its technology allows new features in scalability, finality and governance that developers may adopt. This might be a catalyst to spur on further gains as Polkadot is adopted by more project owners. 

How is Polkadot traded? 

DOT like its competitors is available on cryptocurrency exchanges for this seeking to own the actual asset in hopes its price may rise. Binance is currently the world’s largest cryptocurrency exchange. 

However, crypto traders may instead choose derivatives like CFDs and futures to trade on, speculating on DOT price movements. These are available via our Marketsx platform. Please be aware trading any CFDs or assets contains risk of capital loss. Only trade if you can afford any potential losses.