“Ethereum killer” Polkadot (DOT) is due the introduction of his much-anticipated parachains in conversation. The Polkadot Ecosystem has started auctions for its Parachains, which are scheduled to take place over the next few weeks.
The first Parachain auction has already been closed, with the DeFi liquidity network Acala Network winning the bid. Polkadot CEO Gavin Wood said the Polkadot Parachains provided projects with a free execution model on its network that freed them from other economic constraints.
He added that the parachain leasing model does not require the purchase of tokens or any special knowledge of the DOT framework. In contrast, developers on the Ethereum blockchain would have to use the native ETH token. This drives the transaction fees of the Ethereum network to new heights. Gavin Wood added:
“The users of applications based on Ethereum are economically“ enslaved ”by Ethereum. You have to have Ether on Ethereum and often other tokens as well, because only then is it possible to use every application created with Ethereum Smart Contracts. This is a major limitation. “
Polkadot Parachains and Impact on the DOT Course
Many market analysts believe that the introduction of Polkadot Parachain will have a positive effect on the DOT price. With the increase in the percentage of DOT used in Parachain auctions, the circulating inventory of Polkadot has decreased.
The Polkadot network includes a main chain called the relay chain. There are also several parallel chains created by the users. Polkadot infrastructure expert Bison Trails explains :
“The relay chain is responsible for achieving consensus and transaction delivery … between parachains. Parachains … are application-specific blockchains within the Polkadot network. Each parachain is an independent blockchain with its own logic and functions. “
One of the most important uses for Polkadot is the connection of previously incompatible blockchain networks. It enables values and data to be sent over several blockchains through a connection layer, the “bridge”. Plus, Polkadot’s native DOT also facilitates the important functions of governance and staking.
Polkadot is currently ranked eighth among cryptocurrencies, and analysts expect the price to exceed $ 50 in the near future. If the broader crypto market supports it, the DOT price can go up to $ 70 as well.