What’s so great about it, and why buy it?

Last week, I reached out to some well-known professional crypto fund managers in Russia to give me their top crypto investments so I can get into the action. One of the names that came up was mentioned by others that I hadn’t talked about before, but it seemed like everyone was on the same page: Polkadot (DOT) was the new altcoin that everyone loved it. Every move was right.

The Swiss-born “blockchain” is often said to often kill Ethereum. Ethereum (ETH) is the most traded cryptocurrency after Bitcoin.

But little is known about Polkadot’s lead over the past month in terms of gains, up over 88% to 50% at Ethereum.

It seems that Ethereum is still the only real altcoin to Bitcoin. No one has stolen his thunder. Can Polkadot take some of that?

“Yes. Absolutely. I believe Polkadot is in a key position to take over the altcoin space that Ethereum is currently taking over,” said Denko Mancheski, CEO & Co-Founder of Reef Finance. They are integrated “This is due to the slow development within the Ethereum blockchain,” he says in words that only full – time crypto investors and developers know, as “sharding” and “staking”.

Delays have continued to put pressure on Ethereum, much to the delight of blockchain developers created by Vitalik Buterin, a Russian-born programmer living in Canada. He launched Ethereum in 2014 after dropping out of the University of Waterloo.

Polkadot was founded by the Web3 Foundation in Switzerland and is an open, distributed web created by ex-Ethereum CTO Gavin Wood, Robert Habermeier and Peter Czaban.

What makes it different than Ethereum?

If you think Bitcoin only knows how to transfer value between its partners, Ethereum knows how to do it as well, but they also know how to run complex computing tasks to program a run that performs various duties. Bitcoin is the computer programmer.

The problem with Ethereum is that it runs on something called GAS. Because you have to pay GAS for all computing tasks and the more complex it is, the more expensive it is. Ethereum can get expensive for developers. If Ethereum is like a highway, the programs that developers create on that highway have to pay the price of GAS, which is basically a traffic congestion cost.

Adhering to the symbolism of the highway, Polkadot is like a multi-lane highway, each of which can be built to serve a specific purpose for specific applications.

Polkadot serves as a protocol for blockchain protocols or blockchain, industry experts tell me. There is also an option to interact with other blockchains that are part of the Polkadot ecosystem. That saves money and resources, but it also allows developers to access the Polkadot community instead of building their own community to build new dog-funded projects. Polkadot simplifies the innovation process and takes the burden off of building everything from scratch.

“Most of the people who use Polkadot are developers. They’re people who are passionate about it, ”said Derek Yoo, CEO of PureStake and Founder of the Moonbeam Project, also now on Polkadot. “They’re building a new blockchain or new decentralized applications and finding ways to link the existing chains to Polkadot’s new way of doing things,” he says.

The basic appeal to developers is the clearer and wider canvas they can paint with Substrate, Polkadot’s development system, compared to Ethereum.

If developers are approaching it, so are investors.

Polkadot has been trading for less than a year. It was launched in its original state only in May, amid a global pandemic. It still doesn’t connect to anything, so it’s not the cheapest ETH, so to speak.

“It is better to make investment decisions based on other factors,” said Daniel Wolfe, Managing Director of Halcyon Package Management in Moscow. He runs their Simoleon Long Term Value fund.

“Goals are similar to DOT and ETH, with both aiming to be a major platform for smart contracts,” he says. DOT has many elements that are designed to address ETH’s conceptual weaknesses. But ETH is an established platform with many existing projects working on it. “DOT is something we have and something we look at carefully,” he said. “There is reason to believe that it will be a better network, but we need to see sustainable adoption. If that happens, investors will want to move out of their ETH positions to DOT. “

Ethereum has many elements that make it the preferred catch of institutional investors who have been buying crypto over the past two years. It’s a lot more liquid, of course, and you can buy ETH futures from this month.

For many investors, too, ETH is the coin they buy when they start diversifying outside of Bitcoin. “Institutional adoption is the main driver for crypto valuations today, so it makes sense to have a bigger position in ETH than DOT for now,” says Wolfe.

Many retail crypto investors prefer to buy whole coins rather than fractions, so they are the ones driving the altcoin market. A 100 DOT is better than a quarter of ETH if that’s all you’re willing to play with on Coinbase or Bitpay. Some traders just seem to have the whole coin. I am one of those people.

Coinbase does not have Polkadot, but Kraken and others do. I’m on Coinbase.

“Virtually every cryptocurrency is still closely linked to Bitcoin transactions, at least,” Mancheski said. “There was a lot of talk about divergence and ETH moving in a different direction but the bear markets afterwards showed just what the market is related to Bitcoin price movements. I don’t see this changing anytime soon. Polkadot’s market circle would largely follow Bitcoin’s. “

Sometimes coins just need a little lift. Rud viral. The TikTok teens may be in love with the Disney + Miraculous children’s show: Tales of Ladybug and Cat Noir able to find a friend in Polkadot. Looking at their website is kind of dull, awkward. He has to accept the ladybug, maybe. Replace pink, white and black with red and white and black. Just a compliment.

For now, the latest hot crypto is up just 1,055% since its inception and sells for $ 31.12 a coin. Seven-year-old Ethereum is up 274,991.9% and approaching $ 2,000. Last year at this point, it was $ 265.

Everyone looks at Polkadot the same way – hopefully it follows a similar path to Buterin’s Ethereum.

“Most of the projects being built on Polkadot today will be a bit DOT-related,” says Mancheski. “Polkadot is going to be a market mover.”

Yoo thinks the same thing, which is why he has set up shop on it. “A bet on Polkadot is a bet on a multi-chain future,” he says. “The market recognizes that this is the reality to which we are moving.”