Advantages and disadvantages of Polkadot [Blockchain Analysis]

Polkadot is an open source platform and aims to interconnect the various blockchain networks that exist, in addition to hosting new blockchains that are generated.

Advantages and Disadvantages of Polkadot (DOT)

The Polkadot network is composed of two blockchain networks. the main network or Relay Chain and secondary networks, known as Parachains. These secondary networks can interact with each other with great ease.

The system introduces a new consensus protocol, NPoS (nominated proof of stake) which is a variant of PoS (proof of stake). In this new version the validators are nominated, i.e. the users choose which validator they want to be in charge of the validation processes. To do so, the nominator delegates his assets to a validator node previously chosen by him.

Advantages of Polkadot (DOT):

  • It is scalable. The existence of fragmented chains allow parallel executions of transactions.
  • It has great interoperability. Thanks to the Relay Chain or main chain that interconnects the different blockchains it hosts, it also allows bridges with other blockchains such as Ethereum.
  • Decentralized governance. It incorporates a voting system for users, as well as being able to invest in parachains through auctions. In addition each subchain can have its own gorbenance protocol independent of Polkadot’s.

Disadvantages of Polkadot (DOT):

  • Inflationary model. Being subject to the votes of the user community they can decide to increase the DOT issuance, currently the annual inflation rate is 10%.
  • Complicated system for satking. If you are not experienced or knowledgeable about the Polkadot project it can be cumbersome to take the role of nominator to choose a validating node.