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Polkadot is one of the largest decentralized finance (DeFi) projects in the Web3 space. It is a protocol that connects blockchains, allowing unrelated networks to securely communicate to enable the flow of value or data between them.
In other words, the Polkadot ecosystem aims to resolve many of the limitations associated with blockchains, such as interoperability, scalability, and security. It does this using parallel blockchain “parachains” that take much of the processing demand off of the main blockchain.
The Polkadot ecosystem is powered by $DOT, the network’s native coin. The token serves both as a governance token and for staking.
The Polkadot blockchain has seen major changes throughout the years. What does Polkadot 2.0 aim to achieve?
Let’s find out.
Key Takeaways
- Polkadot aims to address blockchain limitations like scalability, interoperability, and security using parachains.
- The Polkadot 2.0 upgrade transitions Polkadot from a blockchain-focused network to an application-centric platform.
- The JAM upgrade replaces the Relay Chain with Agile Coretime, allowing developers to rent and resell computational power.
- Polkadot 2.0 retains its parachain framework while introducing more tools for developers.
- With no fixed launch date, the broader vision of Polkadot 2.0 will gradually materialize, starting with JAM.
What Is Polkadot 2.0?
Polkadot 2.0 offers a new vision for the Polkadot blockchain network, aiming to make it more flexible, accessible, and capable of supporting a wider range of applications.
While the name might sound like a technical upgrade, Polkadot 2.0 is not a single event or software update. Instead, it’s a collection of changes designed to change how the network operates and what it can achieve.
In a recent YouTube video, Polkadot founder Gavin Wood used a pancake business analogy to explain the change. He described Polkadot 1.0 as a company that makes and sells only pancakes.
These pancakes represent “parachains” — independent blockchains connected to Polkadot’s main network. The company produces its own ingredients, such as sugar, eggs, and milk, but focuses solely on selling pancakes.
In Polkadot 2.0, the company expands its offerings. Instead of just selling pancakes, it starts selling pancake mix and even the individual ingredients.
These “ingredients” represent coretime, which are small, rentable units of computing power that developers can use to build anything they want — not just pancakes.
Currently, in Polkadot 1.0, developers face a number of barriers in order to launch projects. They must compete in auctions to secure parachains, often requiring significant investment in marketing and community support to win.
Polkadot 2.0 changes this by offering alternatives to the auction process, making it easier for developers to access Polkadot’s computing power.
Wood said:
“What we’re now starting to do is to sell individual pancakes. We’re selling pancake mix and we’re selling even individual eggs, flour, and milk. By doing this, we can allow people to make things that are not just pancakes.
According to Wood, Polkadot 2.0 shifts focus from being a blockchain-centric network to an application-centric one.
The goal is to create an “agile, ubiquitous compute resource” where developers can tap into the network’s global supercomputer-like capabilities without heavy upfront investment.
Quick History of Polkadot ($DOT)
- The Genesis block of the Polkadot network was launched on May 26, 2020, as a Proof of Authority (PoA) network, introducing a unique multi-chain architecture with a central Relay Chain and multiple parachains.
- In December 2021, the first parachains became operational. The platform’s governance model transitioned to OpenGov in June 2023, empowering token holders with direct decision-making capabilities.And in June 2023, Polkadot 2.0 was announced, introducing features like Asynchronous Backing and Agile Coretime to improve scalability and flexibility. However, Polkadot 2.0 is much more than just an update.
What Is Polkadot’s JAM Upgrade?
The Join-Accumulate Machine (JAM) upgrade is a key part of the Polkadot 2.0 overhaul. Announced earlier this year, JAM is a technical update aimed at replacing the current Relay Chain, which serves as the backbone for all parachains.
A key part of this upgrade is the introduction of “Agile Coretime,” a new system replacing the existing auction model.
With Agile Coretime, users can buy computational resources in bulk for monthly use and resell portions in secondary markets, creating a more flexible economy for computing power.
All transactions related to Coretime will use DOT, Polkadot’s native token, further integrating JAM into the platform’s ecosystem. This upgrade, detailed in the JAM Gray Paper by Polkadot’s founder Gavin Wood, marks a major step in the completion of Polkadot 2.0.
Happy to release the initial Jam spec in the Gray Paper (10 years after my release of the Yellow Paper): A proposal for the future of @Polkadot. https://t.co/thL6CSNGUp
— Gavin Wood (@gavofyork) April 18, 2024
Parachains Aren’t Going Anywhere
Notably, Polkadot 2.0 isn’t ditching its parachains. Instead, it offers developers more tools to combine Polkadot’s original parachain-focused framework with Ethereum‘s smart contract-heavy style.
Another update in Polkadot 2.0 is the introduction of “accords.” These are like treaties between parachains, ensuring they all speak the same language and follow the same rules when communicating.
By signing up for an accord, parachains guarantee consistent, tamper-proof messaging using Polkadot’s XCM (Cross-Consensus Messaging) format. It’s like ensuring everyone on the team has read the same playbook, avoiding miscommunications.
Meanwhile, Polkadot 2.0 isn’t a single update but a broader vision for the blockchain’s future, so there’s no exact launch date. However, the JAM upgrade, which lays the technical foundation for this vision, is expected to roll out within 17 to 57 months (as of December 2024).
The Bottom Line
Polkadot 2.0 is a major overhaul that aims to make the Polkadot blockchain the go-to platform for all kinds of projects, from small Web3 startups to big Web2 companies testing the decentralized waters.
At the heart of the upgrade is JAM, a technical update aimed at replacing the current Relay Chain and bringing Agile Coretime, a new system replacing the existing auction model. JAM is expected to roll out sometime within the next five years.
