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Since the launch of the DOT token in August, the Polkadot blockchain has become a strong challenger for other networks in space, having gained 60% in value in about four months.
On Tuesday, the digital asset manager () highlighted that he has generated revenues and profits from several projects he has supported on the Polkadot blockchain, a network that some see as the new frontier in the development of blockchain technology and the arena of decentralized finance. ‘
Since its token, DOT, was launched in mid-August, Polkadot has quickly established itself as a key contender in the blockchain industry, with the value of DOT rising by around 60% to just over $ 4.80.
WATCH: KR1 says staking is a “giant step” and a “transformation leap for shareholders”
Simply put, Polkadot is a blockchain network that can be upgraded and scaled more efficiently than others. It also allows for a process called “chain vote”, a new method of managing and updating the system that is transparent to users. Users use their DOT tokens to vote on various decisions that can affect how the blockchain runs.
Polkadot was founded by Gavin Wood, one of the co-founders of Ethereum, a blockchain system that some have dubbed the “world computer” due to its versatility of use. However, Polkadot is part of a series of new blockchain systems that aim to take a share of the Ethereum market.
According to KR1 co-founder and CEO Keld van Schreven, Polkadot currently has around 300 projects running on it and had the fastest growth in the business of developing any blockchain network over the summer period.
“[Polkadot] could be a very important part of this new world we are entering, “von Schreven told Proactive, adding that the pandemic and the resulting economic fallout has provided a” shock to the system “and left people looking for” alternatives. which are much more resilient “.
“This is the starting flag for these necessary new assets … this will be the accelerator event for many activities,” he said.
The co-founder added that the current quantitative easing environment is boosting the performance of digital currencies in general. This can be seen in the price of Bitcoin, the first cryptocurrency, which exceeded $ 17,000 in value this week, levels not seen since December 2017.
Staking is the new mining
KR1 also claimed to have engaged in staking activities in several of its Polkadot blockchain projects.
Staking is often seen as a less resource-intensive alternative to mining digital currency from a blockchain network than mining, which often requires high energy usage and investment in computer processors to solve the algorithms needed to validate transactions on a network.
Conversely, staking simply involves holding funds in a digital cryptocurrency wallet which are then used to support the security and operations of a blockchain network. Tokens are locked in the wallet for this purpose and in return the staker receives a financial or other reward. The more coins a user decides to wager, the greater the reward.
Due to staking that requires less computing power than mining as a method of maintaining blockchain, it is also considered by some to be a way to scale networks to a higher level.
For investors like KR1, staking also serves as a method for the company to extract revenue without having to sell cryptocurrency assets or holdings, with von Schreven stating that staking revenue works similar to interest earned on savings in a bank account.
He adds that due to its lower energy needs, staking is more of a “green and lean” way for blockchain networks to protect themselves in the future, which is “essential” as the world focuses more on efforts to curb climate change.
