One of Polkadot's main strengths is its interoperability. It allows assets to move safely across networks. While this interoperability empowers users, it also introduces new challenges, especially when users interact with centralized exchanges. A misunderstanding of how networks and tokens interact can result in losing access to funds.


In this article, you'll learn what you need to know to operate safely when interacting with centralized exchanges.


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Multi-network tokens


Tokens like DOT or KSM can exist on multiple networks. Users of native Polkadot wallets like Talisman, SubWallet, or Nova Wallet will find it easy to navigate since these wallets intuitively support this feature. For instance, you can hold DOT on the Polkadot Relay Chain as well as on parachains like Polkadot Asset Hub, and transfer them across networks with just a few clicks.


If you send funds to an account managed by a centralized exchange, the transaction will be processed and arrive correctly. However, if the exchange does not support the network on which you made the transaction, your exchange's account might not be credited, and funds could be lost.

But do not worry, read the following section to learn how to avoid this situation.

What to check before transferring to an exchange


Here are a few practical steps to keep your funds safe:

  • Before transferring DOT to an exchange, and until full integration with Polkadot Asset Hub is complete, make sure to send it from the Polkadot Relay Chain, not from a parachain.
  • Never assume that "token support" means "network support." For example, just because the exchange supports DOT doesn't mean it will recognize DOT deposits on any network where the token might exist, like Moonbeam, Polkadot Asset Hub, Hydration, and many others.
  • Do not rely on the deposit address format. Multiple networks might share the same address, and a unified address format will be implemented soon.
  • Always check which networks an exchange supports for deposits. Look for network-specific advice on their deposit page.
  • Use wallets that clearly indicate the network context of your tokens.
  • When in doubt, reach out to the exchange's support before sending funds.


ℹ️ INFO



Although the DOT token is used to illustrate the article, the same principles apply to KSM.


Polkadot's interoperability is one of its greatest strengths, but only when users are aware of how networks interact. Take a moment to double-check before sending funds, and you can enjoy the full benefits of the ecosystem without unnecessary risk.