The Growth of Polkadot's Relay Chain
The Relay Chain of the Nominated Proof-of-Stake (NPoS) blockchain network, Polkadot, has seen strong growth in the fourth quarter of 2022. According to Messari's report, daily active accounts increased by 64% and new accounts by 49%, largely due to users moving away from FTX and towards more open, transparent, and decentralized networks like Polkadot. The launch of USDT and nomination pools has also contributed to the growth.
Polkadot operates as a platform for developers to build their blockchain applications, with the support of Parity Technologies' blockchain development framework, Substrate. The network comprises of interconnected, application-specific Layer-1 chains known as parachains. The Relay Chain, the base platform, secures, governs, and connects the parachains. To date, 35 parachain slot auctions have been won, bonding a total of 133 million DOT (10.5% of the total supply) and auctions are set to continue bi-weekly throughout 2023.
The Web3 Foundation recently declared that the native token of Polkadot, DOT, is no longer a security and is compliant with the law, which provides safety to token holders.
The State of Web3 in 2022 and Beyond
In 2022, the state of web3 and blockchain technology was in a phase of rapid growth and development, despite setbacks from FTX, 3AC and Terra. Adoption of decentralized technologies and digital assets was on the rise, and the development of new infrastructure, protocols, and applications in the space was advancing. Despite this progress, the technology and ecosystem were still in its early stages, and challenges such as scalability, security, and user adoption remained.
In 2023, advancements in blockchain technology, increased investment and regulatory clarity are expected to address some of the challenges faced by web3. Development of more scalable infrastructure, better security measures and increased user education are key factors that could drive growth and wider adoption of web3 and blockchain technology. Collaboration between industry players, regulators and the wider community is seen as crucial to the continued development and growth of the web3 ecosystem.
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Image credits: Shubham's Web3.