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Polkadot upgrade: Faster transaction speeds, new governance rules boost DOT price

By Raphael Sanis

Edited by Charlie Mellor

09:26, 28 September 2022

Polkadot's logo in front of a price graph
Polkadot could soon have between 100,000 and 1,000,000 transactions a second – Photo: Shutterstock

Polkadot (DOT) has announced an array of upgrades for its users as it enters the last quarter of 2022.

The upgrades on its recent roadmap, announed in a statement, included a complete overhaul of its governance system, a consensus protocol allowing ten times faster transaction speeds and new staking features.

DOT surged after the announcement, but its initial rally is starting to wane.

DOT to USD

Polkadot’s recent success

Since the in-depth update details were revealed by Polkadot, DOT saw bullish sentiment from investors. It rallied from a low of $6.18 on 26 September to a high of $6.79 the following day, an increase of almost 10%.

Polkadot has also recently seen successs in its developer activity. In the past 30 days, Polkadot had the most development activity, beating Ethereum and Cardano, according to Santiment.

However, DOT’s price surge has started to calm with it showing signs of weakness. As of 28 September, it was trading at $6.27, down 6% in the past 24 hours and 9% over the past month, according to CoinMarketCap.

A speedy network

Polkadot’s new updates are set to significantly improve the network. It will be intergrating a consensus protocol titled asynchronous backing. This will reduce the block time for parachains to six seconds. The roadmap statement said: 

“We estimate that this update will bring the TPS [transactions per second] capacity of the network in aggregate to between 100,000 and 1,000,000, without affecting the security guarantees made by the network.”

The consensus protocol is anticipated to launch by the end of this year on the Kusama (KSM) blockchain, a canary network used by Polkadot to test upgrades. Asynchronous backing will then launch on Polkadot’s mainnet, “pending the results of audits and testing”.

DOGE/USD

0.16 Price
+3.710% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.0012872

BCH/USD

497.85 Price
+1.840% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 2.50

XRP/USD

0.54 Price
+3.120% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.01168

ETH/USD

3,737.99 Price
-0.500% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 6.00

KSM to USD

Governance transformation

Another major improvement that Polkadot revealed in its latest roadmap was a complete overhaul of its governance system.

It explained: “Our novel governance system removes the council and technical committees, introduces the Polkadot Fellowship, and moves every decision in Polkadot to referendums by the community.”

Users can submit and vote in these referundums, which will be enacted through a permissionless mechanism.

Other network improvements

There was also a hefty list of other upgrades in the roadmap.

In addition to governance and network speed improvements, Poldaot said it would implement nomination-based staking pools. These let users create their own staking pools, where others can join and nominate validators.

Polkadot also said it would add a bridge between the mainnet and Kusama, along with a new staking dashboard. Rob Habermeier, Polkadot’s founder, said:

“We’ve been hard at work on delivering the code for these features and upgrades and look forward to having them accepted by the Polkadot community.”

Markets in this article

DOT/USD
Polkadot / USD
7.3063 USD
0.1089 +1.520%
KSM/USD
KSM/USD
32.45 USD
2.25 +7.630%

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
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