Obtaining cryptocurrencies, including Polkadot, in any US state has never been easier. This refers to people from Kansas, too, whether they are cryptocurrency fiends or complete beginners. And since cryptocurrencies are not considered money and have no monetary value according to the Kansas Money Transmitter Act, Kansans are not obligated to acquire the TOMA license.
In this guide, we’ll discuss Polkadot peculiarities, including the basics of its platform and how it works. Moreover, we’ll provide instructions on how to buy the DOT tokens, elaborate on whether they are a good investment, and explain how you can pick a crypto exchange.
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Aside from being a cryptocurrency, Polkadot is a decentralized, secured, open-source, and multi-chain platform. Polkadot protocol enables the transfer of value and assets between previously incompatible blockchains.
It was created by Ethereum co-founder Gavin Wood, Peter Czaban, and Robert Habermeier in 2016. Its native coin is also called Polkadot — or DOT, for short. Polkadot probably got its name after the polka dot fabric pattern, which looks like it has no beginning and no end. In fact, this image may have contributed to the ideas of decentralized applications.
Polkadot operates on one main blockchain (the Relay Chain) and many others connected to it (parachains). The Relay Chain is the primary network where transactions are permanent, whereas parachains represent user-created networks.
Parachains are easily customized for a number of purposes and can be integrated with the main chain so that their transactions are protected as if they were on the main chain. People behind Polkadot claim that transactions can remain secure, accurate, and private thanks to this design while using only computing resources required for the main chain. This system also enables fast transactions — 1,000 per second, to be precise.
Aside from the Relay Chain and parachains, one more type of chain can be created on the Polkadot network — the bridge chain. Through these, the Polkadot network can interact with other blockchains.
The Polkadot governance structure is clearly defined and divided into three categories:
- Council — Only elected DOT holders can become members of the council. The council members are responsible for electing the members of the technical committee, proposing changes and new updates for the network, and putting a veto on any referendum that is not suitable for the network. Any DOT holder can become a member of the council since an election is held every two weeks. This reshuffles the council members and increases their participation.
- Technical Committee — The committee is composed of people actively building Polkadot. Its members are elected by the council members, and they are tasked with ensuring the smooth operation of the Polkadot ecosystem.
- DOT holders (community) — The DOT community consists of people holding DOT coins. By purchasing them, they gain the right to participate in the process of proposing changes to the network, nominating members for the council committee, and voting on referenda. They can also reject or approve proposals made by other DOT holders.
Polkadot’s main functionalities also make this cryptocurrency stand out. The protocol improves interoperability by allowing all kinds of transfers across blockchains — not only those involving digital currencies. Furthermore, it has excellent economic scalability achieved by spreading transactions to parallel chains. Plus, Polkadot consumes very little energy because it uses a nominated proof-of-stake model.
Polkadot in Numbers
Polkadot is among the top 20 most popular cryptocurrencies. When it first hit the market in the summer of 2020, its worth was around $2.75. Throughout the remainder of the year, there was some growth, and on December 31, Polkadot’s price was $9.29. Its value grew during 2021 until it reached an all-time high of $53.88 on November 4.
December 2021 was a tough month for all cryptocurrencies, and Polkadot was no exception — it was trading at $26.72 on December 31. Currently, the DOT’s worth fluctuates around $19; however, since it can change in a matter of minutes, you should always check it by visiting some of the official websites.
The number of coins circulating in the market is over 987 million, with the current market cap at over $18 billion (as of March 2022). Unlike Bitcoin, there is no maximum supply when it comes to Polkadot tokens.
Currently, the Web3 foundation owns 11.6% of DOT tokens. Polkadot founders own 30%, while various investors hold 54.8%.
Why You Should Buy Polkadot
No one can predict the right time to purchase Polkadot, as its price is volatile and unpredictable. Although Polkadot token prices are currently experiencing a dip, crypto industry analysts are convinced they will quickly rise, which would make this coin a wise investment.
Like with most other cryptocurrencies, there are plenty of internal and external causes that influence Polkadot’s price. However, here are a few reasons why you should invest in it:
- Although Polkadot is relatively new in the crypto sphere, the crypto market is convinced that it has the potential to grow and sustain the uptrend.
- Polkadot uses the Proof of Stake (PoS) consensus mechanism to secure the network. Thus, if you purchase and stake DOTs, you can effectively increase your income by earning interest on staked tokens and their value appreciation.
- Polkadot’s blockchain is appealing to the crypto community because of its innovativeness. Plus, this coin has a solid reputation based largely on the fact that one of Ethereum’s co-founders is also Polkadot’s lead developer and co-founder.
Where Can I Buy Polkadot in Kansas?
We’ve already mentioned that you don’t need the TOMA license, so people from Kansas have two options for trading cryptocurrencies. They can do it via a centralized cryptocurrency exchange or with another DOT holder directly. We’ll discuss both ways in detail.
Centralized Cryptocurrency Exchanges
Centralized cryptocurrency exchanges are platforms that are used for trading cryptos. They allow buying and selling cryptocurrencies, which makes them an essential transaction vehicle. The term centralized refers to the third party — a mediator that handles the assets of buyers and sellers. On the other hand, there are also decentralized cryptocurrency exchanges. Compared to the centralized ones, they allow direct peer-to-peer crypto transactions without the need for an intermediary.
Exchanges provide security and monitoring that an individual cannot achieve alone. DOT holders trust that the exchange of their choice will safely complete their transactions and find them trading partners within the network of users.
Kansans can check out some of the most popular crypto exchanges, including Binance, Kraken, Gemini, Coinbase, and Huobi Global. In case you want to finalize your transactions via an exchange, here are the key elements to consider before choosing one:
- Availability in Kansas — Before settling on an exchange, make sure it holds the necessary money transmitting license and that it is available in your state.
- Supported cryptocurrencies — Each exchange trades with different cryptocurrencies. You should find the one that supports DOT tokens.
- Security — This is the most vital factor by far. That’s why you should check if an exchange utilizes 2-factor authentication, encryption, and cold wallets (offline storage protected from hacking and theft).
- Payment options — An exchange that offers different payment methods will provide you with greater trading options. Many feature debit/credit cards, Paypal, bank transfers, and cryptocurrencies.
- Fees and limits — All exchanges impose transaction and conversion fees, but in some places, they may be higher than in others. These platforms may also charge depositing and withdrawing fees, so pay attention to that as well.
- Liquidity — Liquidity leads to easier and quicker transactions without too much price volatility. It is correlated with trading volume, so the higher the volume of an exchange or an asset, the more liquid it is. The best option would probably be to look for exchanges that offer locked-in trades or guaranteed pricing.
- User interface — If you are a beginner, check whether the site is user-friendly. Easy navigation facilitates seamless operation.
- Overall reputation — Double check if the platform has any security issues. Read other people’s reviews and feedback to see if they recommend it.
Those who don’t want to go through a crypto exchange’s verification process may obtain DOT tokens directly from another owner. This might be an easier and cheaper way, as it comes with no additional fees. However, it’s quite riskier.
We don’t recommend it unless you’ve educated yourself on the latest DOT worth, negotiating tactics, and all the necessary security checks. Even then, you’ll need to find a reliable person to finalize the trade, as you might get scammed easily.
Step-By-Step Guide on How to Buy Polkadot in Kansas
Buying Polkadot is the same as purchasing any other digital currency. However, in case you are a beginner, you can refer to our step-by-step guide that will lead you through the entire process:
- Find a wallet: A digital wallet is where you will store your DOT coins. We advise you to choose one from the list of available wallets on the official Polkadot website.
- Pick an exchange: You can select an exchange from the list we’ve provided earlier, or you can select another one that suits you. Just make sure it covers all the aspects we’ve mentioned previously.
- Create an account: Go to the official website of a chosen exchange, open the account, submit the necessary documents, and complete the verification process.
- Make a deposit: Pick a preferable payment method and deposit the fiat money you’ll later use to buy DOT coins.
- Buy DOT: Select the desired amount of Polkadot tokens and click on the Buy button.
- Transfer DOT to your wallet: After you have purchased the DOT tokens, it is best to store them in your wallet for that extra security layer. However, you can leave them on the exchange if you plan to trade with them further.
We hope this guide has provided some insight on how Polkadot works and what its current worth is. When it comes to investments, we advise you to spend some time studying Polkadot and the broader crypto market. You should analyze the factors that affect the DOT token price and determine its possible direction. We recommend purchasing Polkadot tokens after doing your own research and only if you are convinced that DOT token prices are rising.