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How to Buy Polkadot? A Complete Guide for Beginners!

The cryptocurrency market has again gained prominence after it started to increase exponentially since the beginning of 2017. It is from this time, institutional investors started to get interested in cryptos. In fact, the initial adoption of cryptocurrencies by retail and institutional investors started to gain momentum. 

From this time, many startups started working on different types of tokens and protocols, mainly on the Ethereum platform. With the rise in Ethereum based protocols and tokens, the gas fee (the fee required to use the Ethereum platform) started to increase and the network started to get slower. With the increasing problems faced by the Ethereum network, the need for an alternative, cost-effective, faster, and more agile network started to increase. 

That’s when many alternatives to the Ethereum network such as Polkadot, Cardano, Solana, Polygon MATIC, and many others started to gain prominence. Polkadot network’s Genesis block was launched on May 26, 2020, as a Proof of Authority (PoA) network. The Polkadot coin, DOT, was launched in August 2020. Initially, it was trading at US$2.76 per coin. It reached an all-time high (ATH) at US$49.69 on May 15, 2021. At the time of writing (August 28, 2021), it is trading at US$25.92. 

Since its debut in August 2020, DOT coin’s price has increased by over 9x times till now and by over 18x times if we consider its ATH. The Polkadot coin has now secured its place in the top-10 largest cryptocurrencies (in terms of market capitalization). Currently, it is the 9th largest crypto with a market cap of over US$25.66 billion. 

You must be thinking what is Polkadot? What’s so special about Polkadot DOT coins? Why should you buy Polkadot coins? How to buy Polkadot coins?

In this guide, I’ll walk you through the various FAQs (Frequently Asked Questions) of Polkadot and how you can buy DOT coins seamlessly. 

What is Polkadot?

Polkadot is a next-generation blockchain protocol that is designed to do away with the problems faced by Ethereum. It puts before you a completely decentralized web, which is controlled by the users. 

This open-source sharding multichain protocol helps in the cross-chain transfer of:

  • Data
  • Tokens
  • Other asset types

This means that different blockchains remain interoperable with each other. Enhanced interoperability seeks to:

  • Establish a private web that is fully decentralized. This completely decentralized web is controlled entirely by the users and not the conglomerates.
  • Simply the process of creating:
  • New applications
  • Institutions
  • Services

Polkadot connects multiple specialized blockchains into one unified network. It is created in such a way that it is able to connect:

  • Private and consortium chains
  • Public and permissionless networks
  • Oracles, and
  • Future technologies, which are not even created

With the help of the Polkadot relay chain, this network facilitates an internet where information and transactions can be exchanged by independent blockchains in a trustless manner. Decentralized institutions, services, and applications can be created and connected in an easier manner with the help of Polkadot.

What’s so Special about Polkadot? 

This ambitious project wants to lay the groundwork for a futuristic polychain Web3. Gavin Wood created Polkadot in the quest for designing a more evolved version of Ethereum. Polkadot was created to provide enhanced interoperability between different independent blockchains including Ethereum and Bitcoin. It is the use-value of Polkadot that earns it the name “Ethereum Killer”. 

Top 5 Benefits of Polkadot

The Polkadot network helps in many ways. Here are the 5 leading reasons for you to choose Polkadot over Ethereum:

  1. Promotes Interoperability

Unprecedented interoperability between a wide range of ecosystems is promoted by the Polkadot network. This is done by this system by connecting different blockchains. The user experience of interoperability among these diverse ecosystems is unprecedented. 

  1. Exponentially High Scalability

The Polkadot network helps in increasing scalability exponentially as a standard set of validators is capable of operating multiple blockchains. 

  1. Innovation

A customized blockchain can be easily created by the substrate framework of Polkadot. This easy development process is encouraging more and more developers to participate in the Polkadot system.

  1. Removes Forks

In the Bitcoin and Ethereum blockchains, we have seen that the communities have split up after hard forks. In fact, havoc was caused by the system by forks. That’s why Polkadot was created in such a way that it doesn’t need any fork for upgrading the network, fix bugs, or integrate new features. 

  1. Better Security

DOT coin enables blockchains to meaningfully interact with one another even while remaining independent enough for running their unique governance models.

Why should you Buy Polkadot Coins?

With 80% of the projects currently based on the Ethereum blockchain, it is not easy for Polkadot to replace Ethereum and become Ethereum-Killer. However, Polkadot is fast gaining prominence among developers. 

As the Polkadot network has a high usability quotient, the demand for DOT coins is increasing. That’s the reason why the price of DOT is increasing exponentially (9x times in just 1-year, since its launch back in August 2020). In the coming 5-to-7 years, the price of DOT coins is expected to increase by 5x times to 8x times from the current price level. 

How to Buy Polkadot DOT Coins?

You can follow the following steps to buy Polkadot (DOT) coins:

Step #1: Open an Account with Leading Crypto Exchanges or Online Brokerages

You can easily buy Polkadot coins through cryptocurrency exchanges. The top 10 best leading cryptocurrency exchanges for buying DOT coins are:

  1. Coinbase
  2. Kraken
  3. Binance
  5. Gemini 
  6. Coinmama
  7. eToro
  8. KuCoin
  9. Bitstamp
  10. Uphold

If you already don’t have an account with any of these cryptocurrency exchanges, create one. It’s very simple as long as you comply with the KYC (Know Your Customer) guidelines of the US SEC. You can verify your identity with the DOT exchange by using your SSN, driver’s license, a selfie, and address proof. It takes just 5-minutes. Once your account is verified and approved (which takes anything from a few hours to 3-days), you can connect your bank account and start trading. 

Step #2: Get a Cryptocurrency Wallet 

You should have your own crypto wallet for safely storing your bought Polkadot (DOT) coins with a set of private keys. You can either get a mobile wallet, desktop wallet app, software app, or hardware wallet. If you are a HODLer and want to hold coins for a long period of time (say, 5-years, 10-years, or longer), it is suggested to keep DOT coins in cold wallets (mostly hardware wallets) such as Ledger Nano X, Trezor One, other Ledger hardware wallets, or other Trezor models. 

Step #3: Buy Polkadot DOT Coins

Once you have your own trading account with a cryptocurrency exchange or an online broker and the account is adequately funded, you can start buying and selling Polkadot coins and other crypto assets. 

You can buy DOT by placing different types of orders. Let’s take a look at the 4 order types through which you can buy Polkadot DOT cryptocurrency:

  • Market Orders

This is the most popular order type for buying DOT and other cryptos. These order types are executed as soon as the exchange finds a matching sell order. If you want to buy DOT quickly, a market order is the best way to do that. In case you are finicky about the price, it is not the best option. This is because it gives you less control over the price at which you are buying Polkadot DOT. 

  • Limit Order

These order types are executed as soon as the exchange finds a matching sell order at a specific price, which you have specified. Suppose, you’ve set a limit order for a DOT coin at US$25 per token. Until and unless the price of each DOT coin falls to US$25 or less, your online broker will not fill the order. 

  • Recurring Order

This order type is not offered by all the online brokerages. Some brokers provide recurring order types to their clients. It enables you to invest on a set schedule. Suppose, you want to place an order to buy a specified amount (say, US$100) of Polkadot DOT coins on the first day of every month/week/day/year.

  • Stop Limit Order

It is a condition order type, which only gets executed under a specific price umbrella. This kind of order is filled by the traders if they don’t want to lose more than a certain percentage or limit. Stop limit order enables traders to cut short their loss in case the price movement is not as per their expectation. 

Suppose you want to buy Polkadot at US$25.1. However, you don’t want to make a loss of more than 10%. So, you set the stop price at US$25 and put a limit order at US$25.1. The broker will start filling up the order once it reaches US$25. However, it soon rose above US$25.1. In that case, the broker will stop executing the order at the price that went above the upper limit of the price umbrella. The order will get executed only when the price remains within the range from US$25 to US$25.1.

Step #4: Transfer Polkadot to your DOT Wallet

Traders can transfer their bought Polkadot coins to their DOT wallet (especially if they are long-term investors) to securely save coins. Always be sure to transfer DOT to the right wallet address. Otherwise you’ll lose your crypto permanently. 

Buy and Invest in Polkadot DOT

You can buy and sell Polka crypto coins against various fiat currencies (US Dollar USD, British Pound (united Kingdom fiat currency), Canadian Dollar CAD, South Korean WON, Singapore Dollar, Chinese Yuan, Hong Kong Dollar, etc.) through a wide array of crypto exchanges. 

If you want to increase your investment by 5-to-6-times in the coming 5-to-7 years, buy Polkadot coins now. Keep an eye on the cryptocurrency markets, financial news, crypto news, yield farming, price statistics, block times, and others to time your trading of oracle cryptocurrencies for maximum profit and increasing your net income. 

You can also diversify your crypto coin portfolio by including other cryptocurrencies such as Bitcoin BTC, Ether ETH, Ripple XRP, Cardano ADA, Stellar Lumens XLM, Bitcoin Gold, EOS EOS, Litecoin LTC, Bitcoin Cash BCH, Basic Attention Token, Ethereum Classic, Binance Coin, Kusuma Network coin, Wrapped Bitcoin (some also call it wrap bitcoin or wBTC), USD Coin, Gemini Dollar, ERC20 tokens (created on Ethereum blockchain), NFTs, and others. 

Also, invest in various types of stocks (including dividend yield stocks), mutual funds, index funds, real estate, venture capital, private equity, and others to improve your personal finance. If possible, get help from a portfolio manager or wealth management firm for investment advice and get maximum return. 

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