Polkadot (DOT) Pros and Cons
The Polkadot (DOT) protocol provides the mechanisms to enable interoperability between the various existing (and future) independent blockchains. This is truly a step forward in blockchain technology. In this subsection of the Polkadot (DOT) Coin Guide let's investigate the pros and cons surrounding this project to gain insight into the viability of the protocol.
- Polkadot permits multiple independent blockchains to communicate with one another. The protocol permits the transfer of any type of asset or data (not just tokens) to move inter-chain. The importance of this is that it allows for interoperability of various blockchains regardless of the network the chain is created on.
- The team behind Polkadot is made up of highly skilled and qualified developers and research and development engineers.
- The team utilizes the services of several big name advisors in the cryptoverse, including Gavin Wood (co-founder of Ethereum).
- The development team is highly communicative and transparent with project progress. Likewise, the developers actively communicate with the Polkadot community readily answering questions and providing progress details.
- The team's stated goal is to develop the most adaptable type of platform available to serve all blockchains.
- The Polkadot protocol accomodates both economic scalability (by enabling the same validators to secure multiple blockchains) and transactional scalability (transactions are spread across multiple parallel parachains).
- Polkadot uses Substrate, making it very easy for developers to develop a new blockchain in minutes - allowing for faster growth of the Polkadot network.
- Polkadot is easily upgradeable as new technologies are made available without the necessity of a hard fork.
- The 'data availability' and 'validity scheme' employed by Polkadot allows chains running on the Polkadot network to retain their independent governance with the option of shared security.
- All Polkadot stakeholders have a say in network governance.
- As a result of Polkadot's technology in the area of Proof of Stake (PoS), holders of DOT coins may opt to earn interest (yield) on the coins held.
- Polkadot (DOT) is a relatively new token on the market displaying a lack of an established track record.
- Many of the use cases discussed concerning the Polkadot project have not, as of yet, been put into full operation.
- POLKADOT (DOT) faces a high degree of competition with respect to decentralized applications. Competitors include: Ethereum, Tron, the Binance Smart Chain and Cardano. Polkadot does face an uphill battle in acquiring market share in the smart contract arena.
- POLKADOT may have been the 'first mover' regarding interoperability, but very quickly other blockchains are challenging POLKADOT's dominance in this area.
A quick review of the above shows that with respect to Polkadot (DOT), the 'pros' (in number) appear to outweigh the 'cons'. Just because the sheer number of 'pros' outweigh the number of 'cons', this fact alone in no way implies the 'cons' should be ignored.
As with any investment decision, you must first assess your present financial condition, your overall investment strategy, as well as your tolerance for risk. Armed with this information you should then follow a path of doing your own diligent research into the asset being considered. With all of this information assembled you are finally ready to make your ultimate investment decision.
And finally, please remember, never invest more than you can afford to lose.
Posted Using LeoFinance Beta