What is Polkadot?
Polkadot, a next-generation blockchain protocol, connects a network of custom-built blockchains to function together seamlessly at scale. Polkadot’s ability to transfer any data over any kind of blockchain allows for a wide range of practical applications.
By fusing the best features from many specialized blockchains, Polkadot paves the way for the growth of new decentralized markets and makes it possible for various apps and service providers to offer more equitable access to services.
It offers the benefits of scalability, cross-chain composability, heterogenous sharding, upgradeability and transparent governance.
Multichain vs. cross-chain
Though the purpose of multichain and cross-chain compatibility is to bring interoperability and enable communication between chains, both fundamentally differ.
Cross-chain enables the transfer of a token from a native chain to a non-native chain for that specific token. However, to enable this cross-chain compatibility, there is a need for bridges that can connect two blockchains.
Multichain means a blockchain project that is constructed on many chains. It makes launching a crypto project across several chains at once possible, implying that a project can be native to multiple blockchain networks. Such tokens can be transferred across the supporting chains without utilizing a bridge.
How is Polkadot revolutionizing multichain for Web3?
Polkadot strongly believes that the future of Web3 is connected networks rather than siloed independent blockchain ecosystems. It aims for a multichain world promoting secure communication via Cross-Consensus Messaging format or XCM. It enables interaction among parachains and between parachains and relay chains and allows communication with non-native networks via bridges.
Polkadot intends to connect the Web3 ecosystem using both cross-chain bridges and multichain compatibility. As such, XCM facilitates stable and reliable interchain messaging and unlocks the following features:
- Cross-chain token and NFT transfers
- Reserve-backed assets
- Arbitrary message passing
- Multichain smart contracts, dApps and DeFi
- Paying fees between chains and in any native token
- Multichain DAOs and treasuries
- Bringing external tokens into Polkadot
- Cross-chain reputation system
XCM takes the cross-chain and multichain interaction to the next level. It unlocks the true potential of interoperability by providing instructions for composing, sending and interpreting cross-chain messages. When these messages are received, the destination chain carries out the instructions. It offers several solutions, such as,
- Supporting rich data — Unlike regular bridges that mostly allow token transfers, XCM messages can transfer any data.
- Secure and trustless — XCM enables high security, safe and trustless communication between parachains.
- Programmability — XCM messages are computer programs that can be sent from one place and implemented in another. It enables blockchains to program each other.
- Cross-consensus — XCM can communicate between smart contracts on different virtual machines, over bridges and between substrate pallets. It can also connect networks based on a different consensus mechanism.
Polkadot aims for an interoperable Web3 future where blockchain networks and applications can seamlessly interact. It is developed as a heterogenous multichain architecture for Web3 that bridges multiple chains and aims to connect siloed networks. Each parachain is inherently interoperable with other parachains and the relay chain. Moreover, the XCM messaging format also enables interaction between chains.