# L1 DOT Polkadot By [moonduck15](https://paragraph.com/@moonduck15) · 2022-01-22 --- A cheat sheet to illustrate details on [Investors checklist for Blockchains](https://themoonduck-15.medium.com/investors-checklist-for-blockchain-47c14569c263) . Data or stats are not authoritative and picked from scans of tweets, discord , telegram reddit etc 2021 Q4 and some references are provided. In case of any misses do let me know and I will update. _These notes are more on under-the-hood engineering look. A separate article will cover the business development viewpoint_ _I use the trading ticker rather then name and for example for Axie Infinity blockchain game $AXS implies the coin or token and AXS implies the foundation/DAO/founders as appropriate_ **Status : DRAFT** * Basics * Price Action * Stats and Links * Highlight Pro and Con * Technology * Apps Ecosystem * Funds and Promotions * Readings Basics ------ [Polkadot ($DOT)](https://www.coingecko.com/en/coins/polkadot) was launched in 2017 by [Parity Technologies](https://www.parity.io/). Polkadot’s key founder is Dr. Gavin Wood, one of the co-developers of Ethereum and the developer of the Solidity programming language, which is used in Ethereum to build smart contracts and dApps. Other founders include Robert Habermeier and Peter Czaban, with high-level expertise in blockchain development, cryptography, and Rust. Dr. Wood and Parity’s Peter Czaban founded the Switzerland based  [Web3 Foundation](https://web3.foundation/about/), a non-profit entity established to support the research and development of Polkadot as well as to oversee its fundraising efforts. Polkadot is a modular block chain with a central chain as a ring and up to 100  _heterogeneous block chains permissioned or permissionless_ , which run in parallel plugged in as para-chains. Teams planning to run a block chain as a para-chain benefit from the validator and consensus features of Polkadot but need to commit funds in an [auction](https://polkadot.network/auctions/) and have a renewable lease for 96 weeks. Parachains can have own native token. The initial launch of first para chain started in Aug 2020 and completed Dec 2021 with [5 para chain live from first auction batch](https://polkadot.network/blog/parachains-are-live-polkadot-launch-is-now-complete/) and 159 [projects](https://parachains.info/) are underway ![https://techbullion.com/what-is-polkadot/](https://storage.googleapis.com/papyrus_images/99c00273ce0596d7dffc5a84614a49f03b2fb79588619dd1b6c692cdc6d2a14e.png) https://techbullion.com/what-is-polkadot/ Kusama is a 'pilot environment' similar to Polkadot for developers to initiate and scale up. Kusama (Aug 2019) is an early, (beta?) release of Polkadot, designed to serve as a "canary" network for Polkadot to test governance, staking, and sharding under real economic conditions. Polkadot also dedicated 1% of the initial DOT supply to Kusama stakeholders in order to encourage participation. Kusama, had sixteen parachains launched and running Jan 2022 on its Relay, with a promise of a further five launching in the coming fortnight. 1,000 tps across parachains with claims to scale to 1 Million tps due to parallel processing in para chains. Recorded peak daily transaction volumes around 800 Mill+  in 2021. TTF (Time to finality) or confirmations are around 2 minutes. Estimated 1.4 Mill+ Price Action ------------ 426% Return from 2021 low to high. 9.1936 USD (Jan 1 ) - 26.8050 USD (Dec 31) for 191.56% returns in 2021 ![Snapshot Jan 19, 2022](https://storage.googleapis.com/papyrus_images/67cbc901f447dbd4e78e21be63897e506f17a591578e149b9d422660d0e624ae.png) Snapshot Jan 19, 2022 ### Stats and Links [Community Stats](https://www.coingecko.com/en/coins/polkadot#social) 60K+ Reddit,  1.1 Mill + Twitter , 39K + Telegram 20K+ Discord Social Links [Website](https://polkadot.network/) [Whitepaper](https://github.com/w3f/polkadot-white-paper/blob/master/PolkaDotPaper.pdf) [Github](https://github.com/w3f/General-Grants-Program/blob/master/grants/grants.md) [Telegram](https://t.me/PolkadotOfficial) [Twitter](https://twitter.com/polkadot) [Reddit](https://www.reddit.com/r/dot/)  [Medium](https://medium.com/polkadot-network) [Explorer](https://polkascan.io/polkadot/analytics/charts) ### Highlight Pro and Con * Well conceived Modular chain with planned 100 sub chains * Upgradable chains with runtime code changes using WASM * Technical innovations under development. * Auction of slots for a para chain with limited lifetime * The need to keep locked tokens throughout [the entire life of the para chain](https://www.forbes.com/sites/forbesrealestatecouncil/2019/12/02/three-ways-blockchain-is-improving-our-lives-now/?sh=689b06574572). Technology ---------- Each chain built within Polkadot uses Parity Technologies' [Substrate modular framework](https://substrate.io/), which allows developers to select specific components that suit their application-specific chain best and plug in the base Relay chain managed by Polkadot. This base platform, which also leverages Substrate, does not support application functionality but instead provides security to the network's parachains and contains Polkadot's [consensus, finality, and voting logic](https://polkadot.network/blog/polkadot-v1-0-sharding-and-economic-security/). Para chains need to run Smart-contracts and application data layers. **Consensus** Nominated Proof-of-Stake (NPoS) with  four types of network actors — validators, nominators, collators, and fishermen. [Validators](https://wiki.polkadot.network/docs/learn-validator) are elected using [Variable Random Functions VRF](https://wiki.polkadot.network/docs/learn-randomness) for random sampling in a set active for a duration ( [epoch ~ 4 hours](https://wiki.polkadot.network/docs/maintain-polkadot-parameters#periods-of-common-actions-and-attributes))  to secure the Relay Chain by staking DOT ( may be using $DOT delegated by [nominators](https://wiki.polkadot.network/docs/learn-nominator)) , validating proofs from collators, and participating in consensus with other validators. [Collators](https://wiki.polkadot.network/docs/learn-architecture#collators) produce state transition proofs from collected transactions for the validators on the Relay Chain. [fishermen](https://wiki.polkadot.network/docs/learn-availability#fishermen-deprecated) monitor validators and report any errors ( Guardians in many other chains ); now depreciated as voting mechanism takes care . ![https://wiki.polkadot.network/docs/learn-parachains/](https://storage.googleapis.com/papyrus_images/93eec71ed944eba0e7fec1bd9af11d48b4c72fb7d9d12c517f056bbda8f3913b.png) https://wiki.polkadot.network/docs/learn-parachains/ Polkadot uses a hybrid model to cope with liveliness (TTF)  and certainty under stress. [BABE(Blind Assignment for Blockchain Extension)](https://wiki.polkadot.network/docs/learn-consensus#block-production-babe) is used for block production with probabilistic correctness of the chain . A block author is selected using VRF for a slot and [GRANDPA (GHOST-based Recursive Ancestor Deriving Prefix Agreement)](https://polkadot.network/blog/polkadot-v1-0-sharding-and-economic-security/) for slower deterministic consensus and chain fork amputation to create the 'official' chain. An extensive [tutorial video](https://www.crowdcast.io/e/validating-on-polkadot) best illustrates in detail.   Parity Technologies maintains  the Parity Ethereum client in addition to Substrate, which serves as the development framework for Polkadot. Polkadot Runtime Environment (PRE) consists of the networking, consensus and C++, Golang,Rust and javascript languages under [Web Assembly WASM](https://webassembly.org/) .WASM is developed by major companies including Google, Apple, Microsoft, and Mozilla, with a large ecosystem of support for the standard. Polkadot's networking uses libp2p. Some features: \-[Forkless chains](https://docs.substrate.io/tutorials/v3/forkless-upgrades/) by storing the code for state transition the runtime ( aka  EVM using [Web Assembly WASM](https://wiki.polkadot.network/docs/learn-wasm) which _supports numerous_ [_blockchain programming languages_](https://komodoplatform.com/en/academy/blockchain-programming-languages/)_, such as Rust or C++)_ along with the blocks at each node and making the ability to update that storage thru a function call subject to cryptographic assurance and consensus mechanisms for the chain to upgrade itself ![https://docs.substrate.io/tutorials/v3/forkless-upgrades/ ](https://storage.googleapis.com/papyrus_images/8d55d674bcd6f5720959f2adacda52d7639845fe2e432b91503533989c41e8a7.png) https://docs.substrate.io/tutorials/v3/forkless-upgrades/ Gavin Wood in his 2021 year report proudly talks about the first use of this feature ![https://medium.com/polkadot-network/polkadot-2021-roundup-6cbd3b50c50e](https://storage.googleapis.com/papyrus_images/4daa82fd22a8cbd17306c05669573594914c362f7cb1c50a2835b5ae8f87030a.png) https://medium.com/polkadot-network/polkadot-2021-roundup-6cbd3b50c50e \- [light client 'node'](https://www.parity.io/blog/what-is-a-light-client/) permitting a browser wallet to query the DOT chains without using a cloud based node provider like [Infura](https://infura.io/) or Alchemy \- [Off chain](https://docs.substrate.io/v3/concepts/off-chain-features/) data and code stored outside the chain storage and run in their own execution environment outside of the Substrate runtime. \- [Cross-Chain Message Passing (XCMP)](https://wiki.polkadot.network/docs/learn-crosschain/) . Variations of this were there in modular block chains like Cosmos ATOM and are now multiplying across many multi chain bridges and relayers Projects can be tested and finalized on Polkadot’s Rococo Testnet, and launched on KUSAMA the canary network. 31 Substrate-based mainnets are  [live Jan 2022](https://medium.com/polkadot-network/polkadot-2021-roundup-6cbd3b50c50e).See various [parachains](https://parachains.info/) . Polkadot & Kusama have almost 3 million user accounts created and are being run by 6,000 validators. ![https://miro.com/app/board/uXjVOQbVVsg=/](https://storage.googleapis.com/papyrus_images/e45646493237efde95001719cd9b42eb90bfa92becf1a315ff5e2a66d478e905.png) https://miro.com/app/board/uXjVOQbVVsg=/ Gas or transaction fees are shared with Validators and Collators. Dec 2021 over  twenty thousand accounts on Polkadot elect a total of 297 validators . Polkadot has  [on chain governance](https://wiki.polkadot.network/docs/maintain-guides-democracy) thru its Refrenda, Council  and Technical sub committee. **Para chain Data Availability** In Polkadot, like in most sharded solutions, each shard (called parachain) snapshots its blocks to the beacon chain (called relay chain). Say there are 2f + 1 validators on the relay chain. The block producers of the parachain blocks, called collators, once the parachain block is produced compute an erasure coded version of the block that consists of 2f + 1 parts _such that any f parts are sufficient to reconstruct the block_. They then distribute one part to each validator on the relay chain. A particular relay chain validator would only sign on a relay chain block if they have their part for each parachain block that is snapshotted to such relay chain block. Thus, if a relay chain block has signatures from 2f + 1 validators, and for as long as no more than f of them violated the protocol, each parachain block can be reconstructed by fetching the parts from the validators that follow the protocol over 987 million $DOT is in circulation, with a total supply of 1.083 billion $DOT (via Coinmarketcap) with 10% inflation since the [redenomination](https://www.gfinityesports.com/cryptocurrency/does-polkadot-have-a-max-supply-total-supply-polkadot-fixed-cap-dot/) on August 2020. App Ecosystem ------------- 40 Billion Mcap of [Polkadot ecosystem](https://www.coingecko.com/en/categories/dot-ecosystem). [Coin98 Infographic](https://twitter.com/Coin98Analytics/status/1472552224769204227?s=20) showcases the variety under development and as more para-chains come alive. ![Infographic 1](https://storage.googleapis.com/papyrus_images/57cb4d8d21139ec167298a0642f35074e6036d01206a621f0960bc73843b7c5c.jpg) Infographic 1 ![infographic 2](https://storage.googleapis.com/papyrus_images/39b198cfd3d6820a53173042e27857bef09c6f10ac3fe4ee5766206d2cb80fec.jpg) infographic 2 Sentiments ---------- **Funding** [The DOT ICO](https://techcrunch.com/2017/11/07/a-major-vulnerability-has-frozen-hundreds-of-millions-of-dollars-of-ethereum/) took place in October 2017 and raised over 145 million USD in Ethereum but subsequent wallet hacks lead to a change and re-denomination of $DOT. Estimated 293 Mill $ [raised](https://messari.io/asset/polkadot/profile/investors) .Apart from the Web3 Foundation, which concerns itself with developing a decentralized internet, Polkadot has formed partnerships with Polymath, Energy Web Foundation, Centrifuge, Laminar, Chainlink, Edgeware, Ocean Protocol, Katal, Acala, and many others. The [Polkadot treasury](https://www.dotreasury.com/dot/projects) has handed out almost 200,000 DOT and the Kusama treasury around 70,000 KSM to teams and individuals in over one thousand separate funding proposals. [Web3Foundation](https://web3.foundation/about/) offer a comprehensive grants program focused on funding software development and research efforts related to Polkadot,  Kusama, [Substrate](https://github.com/paritytech/substrate) and [ink!](https://github.com/paritytech/ink). **Reading** [Polkadot Parachains Poised to Add Mojo to Expanding DOT Ecosystem](https://thedefiant.io/polkadot-parachains-second-group/) --- *Originally published on [moonduck15](https://paragraph.com/@moonduck15/l1-dot-polkadot)*