Blog Borrowing Polkadot coin (DOT): Everything you need to know

Polkadot coin (DOT): Everything you need to know

date October 15, 2020 time 3 min read

The Polkadot protocol is changing how data is transferred by connecting public and private blockchains. And the Polkadot coin (DOT) is at the heart of it all. The Polkadot protocol’s exclusive coin, DOT, powers the entire network. putting users in total control of governance. DOT is sweeping the markets as one of the hottest new crypto investments.

What is Polkadot and why is DOT famous?

Polkadot is a protocol allowing multiple blockchain networks to exist within a single chain. In August of 2020, they launched their native DOT coin powers staking, bonding, and governance on the protocol. 

How Polkadot works

There are two types of blockchains in Polkadot; public, permissionless blockchains, and private, permission-locked blockchains. Polkadot protocol lets chain owners transfer data easily from internal private blockchains onto public blockchains.

This sort of process could be useful to organizations that want to do automatic payment processing between fiat and crypto. Banks usually prefer to use secure, private networks while crypto by nature operates on public networks.

Polkadot is an open-source protocol making it easier to move both data and tokens across blockchains
Polkadot is an open-source protocol making it easier to move both data and tokens across blockchains (source: polkadot.network)

The DOT token is used for three main purposes on Polkadot:

  • Governance. DOT holders can use their coins to vote on networks fees, auction dynamics, and scheduled addition of parachains
  • Staking. Polkadot facilitates consensus among users on the platform via staking. DOT holders can stake their tokens to help make decisions on the network. They are penalized/incentivized for completing tasks by gaining/losing DOT.
  • Bonding. Bonding tokens enables users to add new parachains to Polkadot. Parachains are a data structure specific to Polkadot protocol. They can be blockchains—but aren’t exclusively blockchains—that can be validated by the Polkadot Relay Chain. Usually, a parachain will take the form of a blockchain, but there is no specific need for them to be actual blockchains. 

DeFi has exploded in the second half of 2020, and investors are rushing to new products like DOT that may pave the way for further innovation in the field.

Polkadot coin can be purchased on most major cryptocurrency exchanges
Polkadot coin can be purchased on most major cryptocurrency exchanges
(source: images.unsplash.com)

Where can you buy and store DOT Coins?

Besides earning DOT on the Polkadot network you can also buy it quite easily.

Most major exchanges like Binance, OKEx, and Gate.io have listed DOT. Once you’ve made your purchase at the current Polkadot price, you can store your DOT coin on the exchange, or use a crypto wallet like Exodus or Mycelium for additional security.

However, exchange prices can vary drastically. When buying DOT, you should look for a platform that can guarantee the best prices on your crypto every time.

Where to get the best margin prices on DOT today

You can leverage your crypto to get DOT loans at better prices than exchanges through platforms like MyConstant.

We’re a P2P lending platform offering crypto-backed loans sourcing the best prices from major exchanges so you don’t have to.

When you withdraw your loan in DOT with crypto-credit on MyConstant you get:

  • To select your rate and term
  • Borrow from as low as 6% APR
  • Your collateral secured in a secure third-party wallet
  • The best exchange rates. Guaranteed.
  • No extra fees
  • 24/7 customer service
  • Borrow against 70+ different cryptos

Buy DOT on MyConstant and get in on one of the most exciting DeFi products in the crypto world today without selling your crypto. Sign-ups are free. Loans are quick and secure.


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