The cons of polkadot
Polkadot (Ticker: DOT$) hitted its ATH on 4 Nov.The live Polkadot price as I’m writing this article is $52.65 USD with a 24-hour trading volume of $3 BillionUSD. The current ranking is #8, with a live market cap of $51 Billion USD. It has a circulating supply of 987 Million DOT coins.
Also read: USDT vs USDC: Which one is the better stable coin?
Polkadot is an open-source blockchain network designed to enable the linking of multiple, siloed blockchains through the use of a distributed ledger. Polkadot chains are built on Parity Technologies’ Substrate modular architecture, which enables developers to pick and choose the best components for their application chains. The Polkadot network comprises all parachains that are linked to a single platform called the Relay Chain. All of the parachains connected to the Relay Chain make up the Relay Chain. As opposed to previous efforts, the network aims to improve scalability, upgradeability, transparency in governance, and cross-chain composability. DOT rewards and coordinates the ecosystem’s many participants, promoting well-being and proliferation of the project.
Cons of Polkadot are:
1)The DOT token is a newcomer to the cryptocurrency market, having been released in January. Even though it is listed on several major exchanges and is among the top 10 digital currencies, according to CoinMarketCap, it is still relatively new. Due to the lack of infrastructure, huge amounts of liquidity are unable to be made available.
2)There is a bad reputation for it in the community. This low rating is due to the insecurity surrounding the distribution of DOT supplies. As of now, the chain is not mature enough to draw inferences about where and who owns DOT tokens. For instance, there is currently no DOT rich list.
3)Polkadot competes with other cryptocurrencies in the general-purpose, smart contract, Proof of Stake sector, including Tezos, Cosmos, and Cardano, as well as Ethereum, which has already demonstrated network effects.
4)In the past two years, hackers have exploited code vulnerabilities and caused millions of dollars of damage before they were discovered.
5)Depending on the number of parachains available and the process of auctioning slots, there might be certain small use cases that can’t be accommodated since slots are limited
6)Other interoperability efforts, such as Ark/Lisk/Wanchain/IoT Chain/AION, are in the early stages of development, but have not yet released a test net for the general public to use. Polkadot and all of these efforts will very likely be affected by this.
7)Every smart contract company competes for the attention of developers in a competitive market. In order to attract developers and secure contracts, Polkadot’s parachain design presents several challenges. In certain cases, a parachain must have functionality for an app to run on it, creating a chicken-or-the-egg dynamic. In addition, startups and other noncommercial use cases cannot afford to make an initial investment in DOT, making parachains expensive.
8)Polkadot, on the other hand, is still a work in progress and has a lot to prove. As part of this, the Web3 Foundation and the Parity group offer important efforts and a significant degree of decentralization. Since the first mainnet update until the most recent mainnet upgrade, all DOT nodes were centralized and governed by a Proof of Authority consensus network.
9)Polkadot has not been known to have any major technical issues since it was launched in 2011. A software flaw led to the team’s wallets being compromised a second time following the initial coin offering (ICO). In the initial breach, which occurred in July 2017, hackers known as the White Hat Group took $33 million before the attack was stopped by authorities.