Polkadot Price Today in US Dollars – Price of DOT Live Chart

About Polkadot

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The Polkadot protocol is the creation of Ethereum co-founder Gavin Wood. Although Parity Technologies originally implemented it, it is a development of the Web3 Foundation. Polkadot uses the environmentally friendly PoS (proof of stake) consensus mechanism as opposed to the proof of work (PoW) consensus adopted by the likes of Bitcoin and Ethereum.

Polkadot is one of the new and innovative blockchain networks in the crypto space right now. Crypto enthusiasts and investors have termed it the block of blockchains or, more specifically, a multichain.

One of the reasons for this nickname is that Polkadot solves the problem of interoperability in the cryptocurrency space by helping the other cryptocurrencies communicate with each other. 

Polkadot makes the operations of other blockchains easier, serving as a type of translator in functions like asset transfer between different platforms. Again, it creates programs that communicate with other programs on other networks. 

The native governance token for Polkadot is the DOT.

Users can’t mine Polkadot like Bitcoin. The platform is based on the proof-of-stake consensus algorithm. However, you can buy Polkadot cryptocurrency on digital asset exchanges like Binance. The fastest way you can get Polkadot is by exchanging it for other cryptocurrencies or buying it with fiat currency. 

What Drives the Price Of Polkadot?

The price of Polkadot’s DOT coin in the cryptocurrency market depends on several factors to ensure it remains valuable. The success of Ethereum is one factor that affects the price of Polkadot, but how does it? 

Well, as we’ve mentioned, Polkadot is built by a co-founder of Ethereum. These two platforms facilitate the creation of new blockchains on their platforms. They also have their native tokens of DOT and ETH. 

There’s a significant chance that since they are built similarly, the successes of Ethereum may be stifling that of Polkadot because more people are choosing Ethereum over Polkadot. Although with its exposure to potential investors this year and steady but growing adoption, Polkadot’s price can soar.

The demand for decentralized finance also has effects on and drives the price of Polkadot in the market. This year, for instance, has seen a rise in the demand for DeFi. Several cryptocurrencies have already adopted the tech along with Polkadot. 

Such an increase in the demand for decentralized finance causes an increase in the growth of platforms like Polkadot that offer DeFi services. Part of that growth is the increase in the demand for DOT, and hence, its price.

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