Polkadot was first proposed in late 2016 by the co-founder of Ethereum, Gavin Wood and is the main project of the Web3 foundation. It’s a decentralised network of blockchains that puts emphasis on interoperability and scalability. This is done with so-called parachains, or parallel blockchains that work alongside its main Relay Chain. In short, it’s a platform that allows a variety of blockchains to transfer value and data in a trustless way; often referred to as multi-chain technology.

A parachain is capable of self-governing, meaning that it’s not dependent on the main chain and thus is able to create its own token or cryptocurrency. In other words, one parachain can focus on a single component without existing in “isolation”. Given this technical set-up, many specialised blockchains can communicate within Polkadot, thus allowing for the sharing of data, value, assets, tokens, etc. Combined with the finalization component of the “Relay chain” these blockchains can create an efficient and highly secure network.