Polkadot is the most revolutionary and ever-evolving blockchain out there, with lots of innovations happening in the ecosystem on a regular basis. However, it may seem daunting to newbies at first, mainly because it’s a layer-0 blockchain, which goes a layer or 2 below the conventional blockchains that most users are acquainted with.
But fret not! This 101 guide will introduce you to the Polkadot ecosystem and expose you to what you need to know in order to start participating actively in the ecosystem.
Note: The Polkadot community is a large and supportive community. You’re not alone in your journey. The W3F and parity teams as well as the official Polkadot moderators, the ambassadors, and other vibrant community members are always there to help guide and educate you. Feel free to reach out in the official Polkadot or Kusama discord channel if you’ve got any questions.
What is Polkadot?
In the simplest terms, The Polkadot relay chain is the blockchain of blockchains. It’s a meta protocol (ie, a protocol that dictates how other protocols behave) that makes it easy for other blockchains to connect with each other, as well as benefit from its shared security (the importance of this, we shall talk about later).
You can think of Polkadot as the internet of web 3.0, which is mutable, upgradable, and easily adaptable (subject to governance) to new changes. The relay chain permits blockchains that share the same consensus (known as parachains) to connect to it and benefit from its interoperability, security and upgradability), as well as blockchains that don’t share the same consensus with the relay chain (eg bitcoin, Ethereum, Solana, etc) which can still connect to the relay chain via bridges.
What then is Kusama?
Kusama is the canary network of Polkadot. It’s similar to a test network but exists under real economic conditions. You can think of Kusama as being a less strict version of Polkadot. Kusama shares the same architecture as Polkadot, but has looser restrictions.
The aim of Kusama is to allow developers to test out new ideas under loose (and sometimes experimental) conditions. This is based on the fact that if the idea is able to work well on Kusama (which has way looser restrictions in Polkadot), it will work even better once it’s been shipped to the Polkadot relay chain.
Don’t get this wrong though. The Kusama blockchain is a full-fledged and secure blockchain with real economic value. It’s is not a testnet! Many projects actually end up building and launching their main products on Kusama, without plans of moving to Polkadot
Key principles of the Polkadot relay chain
Polkadot was built based on some principles, which aim to solve current issues with the blockchain space. This section will highlight some of them.
Inter-operability
One of the major problems with most blockchains is seclusion.
Most blockchains weren’t built to be interactive with other chains. This poses a lot of issues, as it doesn’t allow for a good experience for users.
For example, the internet wouldn’t have been as great as it’s today if servers are secluded and couldn’t interact with servers outside their networks. There’s the concept of bridges, but research and experience have shown that most of the bridges have very poor designs and are vulnerable to hacks.
Over 1 billion dollars worth of tokens have been stolen from bridge hacks The most recent hack was the Horizon bridge hack, where 100 million dollars worth of funds was stolen.
Anyone can build a bridge. But only a few can build a secure bridge Share on XTo solve this issue, Polkadot developed the Cross-chain messaging format (XCM), which creates a unified way to send messages between chains, smart contracts, pallets, bridges, etc. This unified messaging format will help foster interoperability, as well as help, reduce the risk of building secure bridges
For full details about the cross-chain messaging format, check out the first, second and third parts of the XCM blog by Polkadot’s founder, Gavin Wood.
Blockchain customization
A lot of existing blockchains take the one-size-fits-all approach in building their architecture. This basically means that the security measures put in place when building a casual app in these chains will be the same as when building more security-heavy apps like financial applications. This isn’t the best design because in real life some chains might need to improve the efficiency of some architectural components, at the expense of others (for example, a blockchain Dapp for diamonds will prefer to tilt towards security, at the expense of speed. On the other hand, a blockchain for coffee shops would prefer to do the reverse).
Polkadot takes the “niche blockchain” approach, where blockchains are customized to fit specific intended needs. These blockchains can then connect with the relay chain, and benefit from other “niche chains” in the ecosystem. This form of customization is made easy with substrate (a software development kit, which allows developers to easily spin up fully secure and inter-operable blockchains so that they can focus on building the logic of their chains).
Scaleability
A lot of existing blockchains are not scaleable. They may work fine at the beginning, but their efficiency starts to decline, as the network grows.
The current version of Polkadot was built with Substrate, a rust-based framework that permits forkless upgrades. This means that the Polkadot/Kusama relay chains (and their parachains) can easily upgrade their runtimes to better fit demands in the future if needed (without the chain forking into two or more separate chains).
Shared security
Building a blockchain isn’t necessarily the hardest part. What’s even harder than building a blockchain, is securing it against attacks. It’s well known that new blockchains are quite prone to attacks like the 51% attack. This is because newer chains have a sensitive weak network effect, making it way cheaper to run these forms of attacks on these chains.
To avoid the development of insecure blockchains, Polkadot was built on the basis of shared security, where parachains can connect to the relay chain, and benefit from its security infrastructure. That way, blockchains can focus on building, while knowing that they’re already under the umbrella of a very secure infrastructure.
Shared security has the benefit of making sure that every chain in the ecosystem is as secure as the relay chain, without giving room for mediocrity, with respect to security.
Governance
To be truly decentralized, a blockchain needs to have a well-structured governance system, such that future decisions can objectively be made, based on democratic votes. This is what many blockchains lack, but what Polkadot certainly doesn’t
The Polkadot community can propose and vote for decisions, create public referenda, vote on active referenda, vote for council members, or even become council members. This ensures that decisions like network upgrades, usage of treasury funds, etc are made as transparent as possible
Polkadot Architecture
By design, Polkadot is a lightweight chain whose major purpose is to inter-connect chains and keep them secure. To do this, Polkadot left out hefty runtime implementations (like smart contract implementations). These hefty implementations can be done on parachains, but polkadot left these out, to ensure that the relay chain remains lightweight enough to handle parachains’ interactivity and security.
Polkadot allows other chains (called parachains) to connect to it by securing slots. These slots are secured via an auction and last for a particular period of time after which the parachain will have to auction for another slot (or switch to a previously won slot).
Another way for chains to benefit from shared security is by becoming parathreads (these are pay-as-you-go parachains, where chains pay only for resources used at a point in time, and hence do not have to secure slots).
Parachains (or parathreads) connected to the relay chain do not have their own validators. Instead, they rely on relay chain validators for block validation and finality. Only the validators can produce blocks on the relay chain. Since the relay chain validators have to finalize blocks for all the parachains too, they’ll need a way to get transactions from these parachains. That’s where the collators come into play. Collators collect the transactions from parachains into parachain block candidates, which the validators will use for finality.
In order for a validator to have the capacity to produce blocks, it needs to be in the active set of validators. The only way for a validator to get into the active set is by having enough DOT (or KSM) tokens bonded to it by nominators.
Validator selection is done via Nominated Proof-Of-Stake (nPOS), in which the bonded tokens of nominators can be slashed if their nominated validators misbehave.
Polkadot Governance
To ensure that decisions regarding the network remain transparent and objective, Polkadot has a well-structured governance system that allows both the token holders and council members to drive the direction of the network.
Anyone (token holders or council members) can propose a referendum to make changes to the network, which if passed, will lead to enactments of those changes.
Any token holder can vote on referenda too. This will involve locking your tokens for a specific time period, depending on how much weight you want your vote to carry. Your tokens are unlocked after this time period.
There’re a lot of mechanics regarding referenda, and It’s highly suggested that you check them out here.
However, most referenda usually have total voters that are less than 2-4% of token holders. This is not a true representation of the democratic population. To account for this, Polkadot has council members who are responsible for making critical decisions like managing the treasury, electing the technical committee, etc.
The council also includes a prime voter, who serves as a default voter for members who didn’t vote for any particular motion or referenda. This means that whatever the prime voter votes on, will also be the vote of all absconding voters.
Anyone can become a council member. you can learn more about becoming a council member here.
About parachains
Parachains are chains that are connected to the Polkadot relay chain, with the aim of benefiting from its inter-operability and shared security. These chains are also capable of becoming stand-alone chains if they want to.
For a chain to become a parachain, it must not be responsible for providing its own block’s finality, as this must be done by the relay chain.
Chain candidates can become parachains either by,
- Securing a parachain slot via an auction.
- Becoming a common-good parachain (subject to governance).
- Becoming a parathread (ie, a pay-as-you-go parachain).
The commonest way of becoming a parachain, is by securing a slot. This slot is not permanent as it expires after a specific time period after which the chain will have to secure another slot in order to remain a parachain.
To secure a slot, a parachain will have to participate in an auction with tokens. These tokens can either come from the projects own account or be sourced from the community via a crowdloan. If a parachain wins a slot, the crowdloan tokens will be locked throughout the lease period and released after the lease period ends.
Check out these links to learn more about parachains, slot auctions, crowdloans, etc
About Polkadot accounts
Polkadot is a substrate-based chain. This means that Polkadot addresses will follow the substrate address format. All polka dot addresses will always start with the number 1.
Substrate works in such a way that different substrate-based chains have different address formats for the same account. For example, the Kusama and Polkadot addresses for the same account are not the same. This essentially means that you can use one account for all substrate-based chains. All you’ll have to do is to convert your account address format to that of the intended chain. you can do that using an account transform tool.
In essence, it’s possible to use only one account for all substrate chains. However, this is generally not recommended as it creates a single point of failure (for example, if you use the same account for all substrate chains, then anyone with your mnemonic phrase will have access to your funds in all the chains).
Setting up a Polkadot wallet
There are tons of wallets that you can use to set up a Polkadot account.
You can find a list of the recommended ones here.
But in general, If you’re on a desktop, I’d personally recommend one of these wallets.
- PolkadotJS UI/extension. this is the most powerful wallet, but users sometimes complain about the user experience. Choose this if you want to have full access to the entire on-chain activities.
- Talisman. It’s very easy to use and has a nice UI. It also supports EVM chains, just like Metamask does. Choose this if you don’t want to get nerdy about on-chain events and just want to get stuff done
If you’re on mobile. The two commonest choices are
If you’d prefer to use a hardware wallet, Ledger supports Polkadot and Kusama chains. You can also use parity signer, which allows you to turn your smartphone into a hardware wallet (Note that this is still in beta).
Conclusion
This 101 guide was meant to introduce you to the Polkadot ecosystem without getting into the nitty-gritty. There’s a lot more to learn. The Polkadot wiki is nicely packed with information that can help you improve your skills in the space. Also, join the Polkadot and Kusama discord communities. The community members are always ready and willing to answer your questions.
Keep learning!