Polkadot

Polkadot is a cryptocurrency that uses an upgraded Proof-of-Stake (PoS) algorithm to confirm transactions. The cryptocurrency that circulates in the Polkadot network is labeled DOT. A total of 1 billion DOT coins can exist. A modification of the Proof-of-Stake protocol called Nominated Proof-of-Stake (NpoS) is used to confirm transactions. This system firstly prevents the creation of a fork network, and secondly, prevents the concentration of a large number of DOT coins to a small number of selected owners.

There are several types of public nodes in the Polkadot network. Archived crypto nodes store a full copy of the blockchain. They are needed by applications that query the state of the Polkadot network, as well as full crypto nodes. Each of the full free blockchain nodes stores information only about the last 256 blocks as well as the genesis block. The full public node receives information from the archived DOT node when needed, synchronizing with it. Light Polkadot nodes are also called relay free nodes. They transfer transactions between free nodes until the transaction reaches the full DOT node, which has write access to the blockchain. A light Polkadot node becomes any wallet on the network, including the Chrome extension. There are no rewards for owners of archive, full and light Polkadot nodes.

The Polkadot network is based on the main blockchain (relay chain) that validates the state of parallel blockchains (parachains) using a system of crypto nodes providers. There are varieties of DOT nodes such as collators, validators, and fishermans. Each user can start one of the DOT nodes and start receiving rewards in DOT tokens. In addition to rewards, Polkadot nodes have a system of penalties in case of malicious behavior.

Parallel blockchains communicate with the main blockchain Polkadot using collators. These are users who collect transactions from the parallel blockchains and validate them with a Proof-of-Validity algorithm. The collators are rewarded with commissions for transactions on the network. The data contained in the parallel blockchains are verified by Polkadot nodes called validators. They are rewarded in DOT tokens. So that transactions can be exchanged between different blockchains, a special blockchain called a retranslator is used. Its state is recorded in all the parallel blockchains. To prevent double-spending, the polkadot nodes place collateral deposits on special wallets. If they try to cheat the system, the collateral will be lost. There are also cryptocurrencies nodes called Fishermans. They look for possible violations by crypto nodes validators and if they find violations, they are rewarded.

The Polkadot network supports the execution of smart contracts and the development of decentralized applications. DOT coins can be stored in web wallets, as well as mobile and hardware wallets. There is also a browser-based Chrome extension. DOT token holders can vote on the future development of the Polkadot project. The Polkadot network also supports systems of oracles and digital identity, as well as anonymous privacy chains that use the Zero-Knowledge proof technology. Next, the developers plan to add a system of decentralized data storage and support for modern Internet of Things (IoT) standards.