Polkadot and Token: Let us dig deeper
Polkadot is a smart contract platform that was developed by Dr. Anthony Wood, who was also a co-founder of Ethereum. The network helps developers build interoperable blockchain projects. It differs from other ecosystems in that its projects need to first go through Kusama. Also, it has events known as parachain auctions where people vote and fund projects.
Polkadot’s price has been in a tight range in the past few days. It is trading at $19.73, which is about 24% above the lowest level this year and 65% below its all-time high of $56. As a result, its market capitalization stands at $21.3 billion, making it the 11th biggest cryptocurrency in the world. Its total supply is limited at slightly over 1.65 billion DOTs.
Unlike most blockchain projects, Polkadot does not focus on the quantity of its ecosystem. Instead, it is more focused on the quality of apps built in the network, which explains why it carries out parachain auctions.
According to DeFi Llama, Polkadot’s ecosystem has a total value locked (TVL) of $1.28 billion, making it the 11th biggest platform in the industry. Some of the most popular platforms built using Polkadot are Moonbeam and Acala Network.
Polkadot (DOT) Price History & Technical Analysis
Like most altcoins, the Polkadot price movement had three parts in 2021. In the first part of the year, the price jumped to an all-time high of $50.7. Between May and July, the coin dropped from about $50 to $10.
It then rallied sharply between July and November as investors waited for the parachain auctions. At the time, it retested its all-time high. It is now in the third wave, where it has dropped by 60% from its all-time high.
On the daily chart, the coin has been in a bearish trend and formed a descending channel that is shown in green. Polkadot is slightly below the upper side of this channel. It has also moved below the 25-day Moving Average, while the money flow index (MFI) has been falling. Therefore, the outlook is currently bearish, with the next level to watch being at $15.0.
Polkadot (DOT) Price Prediction for a Year
There will be several catalysts that will affect the Polkadot price in 2022. First, investors will focus on the growth of its ecosystem, especially after the recent parachain auctions. Second, the Fed will have an important role as it starts its tightening cycle. Third, there is the issue of regulations. Friendly regulations, especially from the US, will lead to more demand.
The outlook for Polkadot in 2022 is a bit bullish, considering that the coin has formed what looks like a cup and handle pattern (see the image below), which is usually a sign of continuation. The bullish view will be confirmed if the price moves above $30.
According to Coin Price Predict, the coin is expected to end the year at $28.20 and then continue the bullish trend in the next decade.
Another estimate by LongForecast has a divergent view as it sees the price crashing to about $9. Wallet Investor sees the price rising to $36 in a year’s time.
Polkadot Price Prediction for 2025
While Polkadot’s price has retreated in the past few weeks, its long-term trend has been positive. For one, the coin was trading at less than $1.50 in 2020. Therefore, there is a high possibility that the coin will be at a higher price than where it is today in 2025.
For example, using the stock-to-flow model on Bitcoin, the estimates are that its price will be at about $125,000 in 2025. That is about 2.8x above where it is today. Therefore, by applying a similar multiple, we can estimate that DOT will be at about $56.
This performance will depend on the overall fate of cryptocurrencies and the growth of the web 3.0 ecosystem. Regulations will also play a role.
Coin Price Predict expects that Polkadot will be trading at $68 by 2025, while Long Forecast expects it to rise to be at about $20 in 2025.
Polkadot in Questions & Answers
Is Polkadot Coin real?
Yes. DOT is a real cryptocurrency that is used to secure the Polkadot ecosystem. It is a widely used coin that is valued at over $21 billion.
Will Polkadot reach $50?
There is a possibility that Polkadot will rise back to $50 in the coming years. Since $50 is its all-time high, we can’t rule out a situation where it retests the level.
Should I buy Polkadot Coin?
We believe that Polkadot’s price will keep rising in the next few years. But, investors should wait until a well-defined bullish trend is formed.
How much will Polkadot be in five years?
In my estimation, Polkadot will be significantly higher than where it is today. A conservative estimate is that it will be slightly above $50.
Where do I buy Polkadot?
You can buy Polkadot in some of the popular centralized platforms like Binance and Coinbase. You can also buy leveraged Polkadot tokens in exchanges like FTX and Huobi. Also, it is offered by popular decentralized exchanges.
This article represents the views of the author. Cryptocurrencies are highly speculative assets, and the author will not be held liable for any losses.
