Ethereum is the second-largest cryptocurrency with a market capitalisation of $ 544 billion (~INR 114 trillion). Glorified as the largest smart contract blockchain platform, Ethereum is often compared to newer blockchain networks. With a market capitalisation of $52 billion (~INR 3 trillion), Polkadot Crypto is taking the world by a storm as investors say it’s set to beat Ether currency’s grandeur.
What makes Polkadot so special?
Polkadot’s founder, Gavin Wood, is the ex-CTO of Ethereum and the inventor of Solidity language and smart contracts.
Polkadot was created to target the problem areas of the existing blockchain networks specifically.
- Interoperability – While blockchains work independently, Polkadot offers communication between blockchains, thus increasing efficiency. Several blockchains are often working on similar projects, which defeats the purpose of innovation. Interoperability is certainly a crucial addition that will change the future of crypto.
- Scalability – The biggest problem with blockchains is the number of transactions that can be carried out every second. This proves to be a hindrance, limiting the capacity of the blockchain. Polkadot’s interoperability, through a system of “parachains,” offers over 1 million transactions per second, while Visa has a TPS of only 45,000.
- Test new ideas – While there are many platforms to test blockchain networks, through Kusama, Polkadot allows blockchain networks to be tested using real economy. This also helps filter out only serious projects since the stakes are high.
- Poor governance – Blockchains tend to get too centralised or lack security. Polkadot Crypto will follow a voting regime called referenda which makes the decision a simple yes or no answer based on the majority.
- Proof of Stake – This involves locking up certain currencies as security while verifying transactions. Once the transactions go through, the block rewards are distributed to the users that verify transactions. Most blockchains currently operate on Proof of Work to complete transactions. Proof of Work involves solving difficult math problems to receive block rewards. As a result, large amounts of “gas fee” is paid for processing the transaction faster. Proof of Stake solves this entirely.
We have already seen a more than 360% jump in the Polkadot price, making it an extremely popular Cryptocurrency to buy.
Does this make Polkadot a more lucrative investment option?
If you are thinking of buying cryptocurrency, Polkadot’s fresh approach cannot be ignored.
That being said, Ethereum is a power player, occupying ten times the market capitalization of Polkadot. With its new upgrade, Ethereum is proving to be a tough competition. Leveraging its first-mover traction, Ethereum will be a tough nut to crack owing to being the host for all of crypto’s most used DApps (Decentralized Apps). Ethereum is also hosting most DeFis and NFTs, which are swiftly gaining popularity amongst new investors. With its upgrade, Ethereum will also use Proof of Stake, only adding to its attractive features, including a high-security level.
Keeping innovation at the centre, both Ethereum and Polkadot are swiftly progressing towards creating a massive and positive future for cryptocurrencies. This competition could prove to be a golden opportunity for investors.
If you’re planning on making Polkadot or Ethereum a part of your cryptocurrency portfolio, here’s much it will cost:
Ether price in India is currently around INR 3,69,500, and Polkadot is available for INR 4,200.
Read more on how to build a successful crypto portfolio here. (Link to Zebpay’s article).
Press releases published by Crypto Economy have sent by companies or their representatives. Crypto Economy is not part of any of these agencies, projects or platforms. At Crypto Economy we do not give investment advice and encourage our readers to do their own research.