Polkadot Coin Price Up By 8.22% – Time To Buy DOT?
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DOT, the native token of the Polkadot network, has been a strong performer in the crypto market. With the asset rising 8.2%, is the time right to buy DOT? Let’s find out real quick.
Polkadot: An Alternative To Ethereum
Founded in 2016, Polkadot aims to support web decentralization and address issues in the original Ethereum project.
Polkadot is an open-source sharding multichain protocol that facilitates the cross-chain transfer of any data or asset type, thereby making a wide range of blockchains interoperable with each other. Polkadot was developed by the Web3 Foundation and Parity Technologies. It is built on Substrate, which enables the trustless distribution of information.
The network enables the building of smart contracts and new blockchains, and tokens. The Polkadot blockchain uses a tweaked version of the popular proof-of-stake protocol called nominated proof-of-stake (NPoS).
The DOT token serves as the governance asset for the network. DOT tokenholders have the privilege to vote on proposals on the blockchain. It is also used for network fees and to create parachains in the Polkadot ecosystem.
Parachains are one of the core components of the Polkadot project, which describes independent chains that have their own tokens on the network. Another important component in the network is Parathreads.
Parathreads operate under a ‘pay-as-you-go’ model, making them a short-term offering. While parachains are secure through auctions, parathreads are not.
Blockchain projects looking to join the Polkadot protocol have the opportunity to choose between launching on the parachain structure or the parathread architecture.
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DOT Battling At Critical Support
DOT has a market cap of $18 billion and is currently ranked at the 9th spot on the top 10 charting cryptos in the market.
DOT was trading at the price of only $9.044 at the start of 2021 but has since moved up from that range. It climbed to the $40 level on February 20, when a broader rally brought several cryptocurrencies to new record highs.
The coin’s value dropped back to the $30 level in March and rose to $44.67 on April 17. On May 15, DOT reached its all-time high of $49.69. However, the May crypto market crash saw DOT drop more than 50% to $15.49 a month later.
DOT’s price currently is at $18.66, with a 24-hour climb of 8.22%. The surge in DOT’s price shows it’s returning the bullish sentiment, so now might be the time to buy DOT.
DOT Technical And Fundamental Analysis
DOT is trading below the 20-day moving average (MA) support at $18.36, showing a bearish trend on the trading chart. Its relative strength index (RSI) is also above the oversold level at 50.30.
Nevertheless, investors who want to buy DOT should not be discouraged as the analysts in the crypto market believe that the cryptocurrency is still going to double in value.
Wallet Investor has put its 1-year prediction at $46.633 while its 5-year forecast is at $159.319.
Meanwhile, the Polkadot project has achieved the final core functionality outlined in its whitepaper. Its sister network, Kusama, recently completed the first parachain slot auction. The parachain auctions will enable blockchain platforms to launch on the Polkadot ecosystem.
This is because the Kusama network would be bridged to Polkadot in the future for cross-network interoperability.
Polkadot’s ecosystem is brimming over with innovative startups and smart solutions. At press time, the total number of Polkadots projects stood at 481.
