Among all the so-called rivals to Ethereum, Polkadot is one project that has been taken seriously by the community and investors. Its unique concept of united parachains offers both users and developers more possibilities in the upcoming Web3 world. Polkadot’s native asset, DOT, has already gained a lot of value and according to many experts is a prospective project. Read our Polkadot token price prediction to decide if it’s the asset you want to get a closer look at.
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Polkadot Fundamental Analysis
Polkadot is an open-source shared multi-chain protocol that connects and secures a network of the other networks, thus providing a cross-chain transfer of the data or the assets, so the networks become interoperable with each other. The project was created to be a foundation for the decentralized internet of blockchain also known as Web3. It can connect public and private chains, permissionless networks.
The project’s data availability and validity schemes allow chains to interact with each other while remaining independent in their governance. Parachains (parallel chains) share the security, but have their own governance tokens and can be optimized for specific goals. At the end of 2021 Polkadot successfully held parachain auctions and signed the first five slots to the auction winners (Parallel, Acala, Moonbeam, Clover, and Astar).
Polkadot is a layer-0 underlying metaprotocol that describes the format of the layer-1 parachains. An important feature of the network is its possibility to autonomously and forklessly update its one code through the on-chain governance.
Another significant advantage of Polkadot is its scalability, achieved by enabling the sets of validators to secure multiple networks. Polkadot spreads the transactions across multiple parallel blockchains. Thanks to the substrate network, the users can easily create their own custom networks, thus helping the network to grow.
Compared to the other blockchains, and thanks to the nominated proof-of-stake model, Polkadot consumes much less energy and has the lowest carbon footprint among proof-of-stake protocols.
DOT is a native token of the Polkadot blockchain and it’s used for 3 main purposes: staking for operations and security, facilitating decentralized governance, and bonding the assets to connect the parachains.
Polkadot Live Price Chart
Since the spring of 2021, the price of the DOT token wasn’t stable and was being affected by many factors. At the end of March, the token started to gain value as the crypto market was turning to a bull rally. On April 5 the asset reached $45, but then was corrected and traded around $40-$42.
As the crypto market was going bullish, Polkadot also followed the trend and on May 14 hit the price of $47.9, which was the highest value for the token at the moment. In just 4 days though as the market flipped to a bearish trend the asset lost almost 50% of its price and went down to $25. For the next month, the DOT token was bouncing between $20-$25, but at the end of June, the token’s price collapsed to $14.65.
The token stayed bearish till the end of July when it started to show the signs of recovery together with the rest of the crypto market. By the middle of September the asset was already traded for $37.3, but after reaching this level, the token went for a 2-week long price correction, keeping the resistance level of $26.
The new wave of the bull rally made the asset hit the all-time high of $53.88 on November 4. DOT could maintain the same level only for 4 days, after which the token started to lose value again, while the market started to turn bearish.
The asset stayed in a downtrend till the end of December, when it reached $24, but then the price recovered a little bit and for the next month DOT crypto was bouncing between $24 and $31. At the end of January 2022, though, the price crashed again and the DOT token was pulled off to $18.8. The price stayed volatile till the end of February with the token not being able to break through the $22.6 resistance level.
The situation started to change at the beginning of March 2022. During the last week, Polkadot grew in price 10% and continues to steadily gain value. This rise comes along with the launch of the Polkadot Parachains Fund. Most of the market experts see the uptrend coming for Polkadot and expect its price to increase in the nearby future. As for the long-term, the chart shows that the price of DOT coin might go down.