What is Polkadot?

Polkadot is a scalable, heterogeneous, sharded, multi-chain network.

Polkadot is a permissionless and ubiquitous computer

Polkadot is a decentralized open-source community

Polkadot is a digital-native sovereign network

Environment

Polkadot has many faces, both technical and social.

It is the real-world instantiation of the technology described within this module.

These technologies only define the limits of the environment. Polkadot is everything which happens within it.

Agents

Within the environment, various types of agents may take action according to its rules.

These may be human users, silicon users, governments, or legal entities.

They likely have different agendas and activity levels, and may be located anywhere in the world.

Polkadot is an online economy for smart agents.

Games

Polkadot fulfills its goals with a combination of mechanisms and games which provide incentives and disincentives for nodes to work together and construct this environment.

All Together

Goals of the Environment

1. Real-time, secure, global consensus on system state
2. Trustless, censorship-resistant, and permissionless transaction at scale
3. Explicit network-wide governance and co-evolution
4. General programmable computation with full security
5. Secure and trust-minimized interoperability between processes

Goals: Breakdown

(1) Real-time, secure, global consensus on system state

Polkadot's state should update as close to real-time as possible.

A global, unique history of everything that has happened is maintained.

Goals: Breakdown

(2) Trustless, censorship-resistant, and permissionless transaction at scale

Only a private key and a balance is needed to interact with the network, and without trusting any single third party.

It aims to do so at high scale.

Goals: Breakdown

(3) Explicit network-wide governance and co-evolution

Polkadot stakeholders explicitly govern and evolve the network,
with the ability to set new rules.

Goals: Breakdown

(4) General programmable computation with full security

Polkadot is extended by general programs, usually taking the form of blockchains which themselves may be programmable environments.

Generalized computation allows the capabilities of the network to be extended arbitrarily, while inheriting the full security of the network.

Goals: Breakdown

(5) Secure and trust-minimized interoperability between processes

Processes deployed on Polkadot need to:

Validators

Validators decide to participate in the upkeep of the network.

Validators participate in the core games of Polkadot.

Validators

Validators are incentivized to do things like put user transactions in blocks or contribute to other activities, but may opt out of many of these tasks.

Validators are strongly punished for explicitly doing their job wrongly.

The games work as long as enough validators are doing their job
and also not misbehaving.

Polkadot: Major Systems

Validators are made to provide accurate execution for processes deployed on top of Polkadot.

These processes, defined as WebAssembly Code, are colloquially known as parachains.

Polkadot scales by sharing the load of validating these parachains across many validators.

The Relay Chain

The relay chain is the "hub" of Polkadot, providing the main games which validators play. It is built with Substrate.

Notably, the functionality of the relay chain is minimized,
with the expectation that more complex functionalities will be pushed to less critical parts of the system.

Relay Chain Functionality:

Relay Chain Games:

The Relay Chain consists of two key games:

These games are the enablers of all activity within Polkadot.

Game: Relay Chain Consensus (simplified)

The game works whenever <1/3 of validators misbehave.

Game: Parachain Consensus (simplified)

The game works whenever <1/3 of validators misbehave.

All other functionalities of the relay chain (staking, governance, balances, etc.) are just baked into the definition of valid block and valid transaction.

Staking: Nominated Proof-of-Stake

As the Relay Chain progresses, it operates a system for selecting and accruing capital behind validators.

Accounts on Polkadot may issue a "nominate" transaction to select validators they support. Every day, an automated election selects the validators for the next 24 hours.

Nominators share in both the reward and slashing of their nominees.

Message Passing: Trustless Communication

The Relay Chain manages message queues and channels between parachains, as well as between each parachain and the Relay Chain itself.

Part of the Validators' job is to ensure that message queues are properly maintained and updated.

Registering Parachains

In 1.0: this is done via Slot Auctions to get a large bulk allocation

In the future: this will be done on a more granular / ad-hoc basis

OpenGov

Polkadot has on-chain governance by stakeholder referendum, voting on subjects such as:

Treasury

The intention of the treasury is to pay people to help grow Polkadot itself. As tokens are burned, this creates pressure to fund public projects.

The Fellowship

A collective of developers, coordinated through on-chain activities.

These are node maintainers, developers, or researchers.

They set the technical direction for the network through RFCs.

(1) Real-time, secure, global consensus on system state

This is provided by the validators participating in Relay Chain Consensus. Every block they make and finalize advances the system state.

(2) Trustless and permissionless transaction at scale

"at scale" is the caveat that drives most of the engineering in Polkadot.

Polkadot scales by virtue of the Parachain Consensus game, where the parachains themselves process most of the transactions in the network.

The more efficiently this game is implemented, the more Polkadot scales.

(3) Explicit network-wide governance and co-evolution

This is handled by OpenGov and the Treasury. Polkadot is a "meta-protocol" where OpenGov can update anything in the network, including the network's own rules.

(4) General programmable computation with full security

This is provided by the Parachain Consensus game, as most parachains are registered by users and validators are on the hook for valid updates.

Parachains themselves may also provide generalized computational functionality, e.g. EVM contracts.

(5) Secure and trust-minimized interoperability between processes

The Relay Chain maintains message queues between chains to provide interoperability (protected trade routes), however, full trust-minimization (enforced trade agreements) requires future protocol features to land.

From This

To This

Blockchain Scalability Trilemma

1. Security: how much does it cost to attack the network?
2. Scalability: how much work can the network do?
3. Decentralization: how decentralized is the network?

Challenge: Scale while navigating the trilemma.

Scaling vs. Scheduling

Scaling is important, but resources must be allocated efficiently to make best use of that.

Polkadot allocates its resources to parachains through Execution Cores.

Execution Cores

Just like a decentralized CPU, Polkadot multiplexes many processes across cores.

When a parachain is assigned to a core, it can advance.
Otherwise, it lies dormant.

Execution Cores enable efficient allocation through Coretime trading.

Coretime: Polkadot's Product

Coretime is what applications buy to build on Polkadot.
Goal: be like cloud.

Primary and secondary markets are key enablers.

Scalability + Scheduling

Full Circle

Polkadot is a scalable, heterogeneous, sharded, multi-chain network.

Polkadot is a permissionless and ubiquitous computer

Polkadot is a decentralized open-source community

Polkadot is a digital-native sovereign network