As the cryptocurrency market recovers from last winter's sudden chill, one name strikes me as a fantastic investment for the long run. In fact, I'm so excited about Polkadot (DOT -2.13%) and its future prospects that I doubled down on my position last week.

Let's see why I'm putting real money into this promising but relatively obscure cryptocurrency right now.

What is Polkadot?

In simple terms, Polkadot helps other cryptocurrencies work together. By connecting specialized coins and blockchain networks together, the Polkadot platform brings out the best qualities of each contributing currency. As a result, developers can rely on Polkadot to build powerful applications that simply wouldn't be possible any other way.

For example, Bitcoin (BTC -0.83%) is an effective system of long-term value storage and Ethereum (ETH -0.28%) runs decentralized computer code in the form of smart contracts. Filecoin (FIL -5.18%) offers a blockchain-based system for secure file storage without central storage servers. Creating a single cryptocurrency that supports all of these functions would be difficult at best. Polkadot lets you build a decentralized application that features all of these unique features in a coherent package.

That's why I'm convinced that Polkadot will play an important role in the next era of the internet. This is the glue that binds the entire cryptocurrency ecosystem together. That takeaway should not come as a surprise, because Polkadot was designed as a platform for the next-generation internet model known as Web3.

A pile of gold and silver coins, bearing different cryptocurrency logos.

Why pick just one? Image source: Getty Images.

Investing in Polkadot today will let you benefit directly from the Web3 sea change. That's a big deal, and the fundamental building blocks of the Web3 structure should become household names over the next few years.

There's more to it, of course. Part of Polkadot's power lies in the network's innovative structure, where so-called parachains can add more functionality over time. As the parachains are plugged into the larger Polkadot machinery, the process itself provides funding tools for each new parachain's development team -- and that's another important advantage. I can only scratch the surface of Polkadot's complex and powerful setup today, but I have talked about the network's supporting ecosystem and the power of parachains in other articles.

Available at a low, low price

With a market cap of $22 billion, Polkadot is the 11th-largest cryptocurrency on the market today. That's a respectable ranking, but still just a 1% sliver of the total market. A fully mature Polkadot should account for a much larger slice of an expanding crypto market.

Furthermore, the market stepped away from cryptocurrencies and other potentially risky investments over the last six months. Polkadot was swept up in that risk-averse trend, and the cryptocurrency now trades 59% below November's 52-week highs:

Polkadot Price Chart

Polkadot Price data by YCharts

Past performance is no guarantee of future returns, of course. Many cryptocurrencies have crashed just as hard in recent months, but most of them cannot match Polkadot's well-lighted path toward widespread usage in real-world projects. The combination of incredible business prospects and dramatic buy-in discounts drove my hand to Polkadot's "buy" button again.

So Polkadot is not only a tremendous investment based on its real-world use and unique market role, but the coin is also on fire sale right now. And I'm not just saying that. Doubling down is an understatement -- I quadrupled my Polkadot position last Wednesday and might add even more of these coins if the discount lasts much longer.