What makes Polkadot unique?
Most blockchains operate on their own and are entirely independent from one another. For example, Bitcoin (BTC -1.76%) has its own blockchain, as do Ethereum (ETH -1.54%), Cardano (ADA -1.10%), and other cryptocurrencies. They don't communicate with each one another, so decentralized apps (dApps) built on Ethereum and Cardano couldn't interact.
That's where Polkadot comes in. It's a multichain network, which means it can join different blockchains together. Developers who use it can build their own blockchains that are also able to interact with all the other blockchains in the Polkadot network.
Interoperability opens up new possibilities for the blockchains on Polkadot. Let's say that one blockchain allows users to invest in tokenized versions of stocks. It could obtain data from a separate blockchain with up-to-date stock price data.
Another benefit for developers is that Polkadot takes care of validating transactions and network security. Transactions are processed on the network's relay chain. This allows developers to focus entirely on their blockchain projects without needing to build a secure system for validating transactions.
Where Polkadot came from
Gavin Wood, a co-founder of Ethereum, came up with the idea for Polkadot and released its white paper in 2016. The next year, Wood and Peter Czaban founded a nonprofit organization, the Web3 Foundation, dedicated to the development of Polkadot. Robert Habermeier, who has a research and development background in blockchains, is also a co-founder of Polkadot.
In October 2017, the Web3 Foundation raised $145 million in Ethereum by selling DOT tokens. However, the wallet storing the ETH tokens was hacked, and about $90 million in funds were frozen. To recoup the loss, the foundation held a private token sale in 2019.
Polkadot rolled out in multiple phases. The initial version of the network launched on May 26, 2020. It completed the launch when its first five parachains went live on Dec. 17, 2021.
