The list of top 10 cryptocurrencies by market capitalization changed a lot in 2022. Many newcomers entered the list, mostly stablecoins. This is because 2022 is a bearish year, and most crypto investors are turning to stablecoins to protect against lower prices. However, other cryptos are competing to stay on the list. Recently, Polkadot surpassed Dogecoin to become the #10 largest crypto by market cap. Is Polkadot still worth it? Should you invest in Polkadot as the crypto market rebounds? In this Polkadot price prediction article, we look at the fundamentals of the Polkadot project and analyze DOT technically.
What is Polkadot (DOT)?
Polkadot is a blockchain project launched in 2017 by the Swiss non-profit organization Web3 Foundation. The inventor of the project is Dr. Gavin Wood, one of the founders of Ethereum and one of the developers of the Solidity programming language for smart contracts. The ICO in 2017 raised $145 million at that time.
When the company was founded, 10 million DOT were issued as network tokens. The number of DOTs increases to 1 billion in August 2020 for simplicity. The project is still under development. However, a large part of the expected network functionality is now live.
How does Polkadot work?
Polkadot is intended to form a network of blockchains that connect different blockchains and thus create the so-called “Internet of blockchains”. In other contexts, there is also talk about things Web 3.0. Its unique selling point is the so-called parachain, which connects and communicates with different blockchains. As a consensus mechanism, Polkadot uses the NPoS (Nominated Proof of Stake) protocol.
The DOT network token has several roles in Polkadot:
- Network management: Token holders can control changes to the platform, such as setting network fees, scheduling events, updates and repairs.
- Staking: Active token holders guarantee the functionality of the platform by validating transactions through staking.
- Add Parachains: When new parachains are added, DOT tokens are tied. If this parachain is worthless and removed, DOT tokens will be available again.
Polkadot BEATS Dogecoin for #10 points
Dogecoin has struggled to remain the 10th largest cryptocurrency project by market cap. However, in the last few days, Polkadot managed to beat Dogecoin and take its place. Polkadot’s current market cap is $8.2 billion, just $160 million more than Dogecoin’s market cap. The latter has the main support of Elon Musk who was removed in the last few months. However, Polkadot on the other hand is still an advanced blockchain project.
With the latest market drop, Dogecoin has failed to recover while Polkadot has bounced back. DOT up by more than
Polkadot Price Prediction – Will DOT continue to rise?
If we look again at figure 1, we can see that the DOT in the trend is limited between $6.8 and $7.6. As prices continue to rise towards the $7.6 resistance, we expect a lower retracement to $7.2. This retracement can take Dogecoin further if it can increase its price. The difference between Polkadot and Dogecoin is still thin.
Looking above all the time before Polkadot, we can see a x8 increase on the horizon if the crypto market picks up again. Investing in DOT will have a price target of $40 and $50, but definitely not in 2022.
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