What Makes Polkadot (DOT) a Unique Crypto Project?

What Makes Polkadot (DOT) a Unique Crypto Project?

Polkadot (DOT) is an innovative blockchain solution that aims to create an ecosystem that will allow the integration of various cryptocurrencies and blockchain extensions. One of the original approaches used by DOT developers is the system of parachains that may be used for different real-world applications, while, at the same time, enjoying the proper integration with the main chain. In this manner, users can achieve an effective balance between the maximum flexibility and security of their blockchain transactions. In addition, Polkadot has successfully adopted the proof-of-stake algorithm and enjoys higher scalability and lower cost as compared with Ethereum and other competitors.

All transactions are finally confirmed in its major Relay Chain that processes more than 1,000 transactions per second, while Ethereum currently processes just about 15 transactions per second. The Polkadot users may perform the functions of validators, nominators, collators, and fishermen with the possibility of receiving proportional remuneration in DOT tokens.

Polkadot offers a highly democratic approach to governance by ensuring the proportional distribution of decision-making potential among the Council, DOT holders, and Committee. In this manner, the interests of all key stakeholders are adequately represented.

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Largest Cryptocurrency Platforms by the Number of Developers; data source – Forbes

By the total number of developers, Polkadot occupies the second system in the crypto industry, exceeding the number of Solana and Bitcoin developers combined. Thus, the growing number of blockchain developers confirm their belief in DOT’s long-term success and ability to attract new users and investors in its ecosystem.

On one hand, Polkadot may be successful in offering more flexible and less expensive solutions to the current Ethereum users (unsatisfied with the lack of scalability and prolonged transition to Ethereum 2.0). On the other hand, Polkadot may encourage the introduction of new revolutionary blockchain start-ups on its platform, contributing to the sustainable growth in the demand for DOT’s tokens in the future.

The ability to serve as a validator and receive a staking income may be the main determinant of DOT’s success in the short run, while the overall development of the project and involvement of new users and developers may contribute to its strategic growth in the following years.

Is DOT a Good Investment?

Despite the general consensus on the successful development of the DOT project in the long run, the current price correction may continue, following the general dynamics of the crypto market. The identified support and resistance levels may serve as the general approximation of the changes in DOT’s price within the following months.

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Figure 1. DOT’s Technical Analysis; data source – TradingView

There is a high probability of DOT’s price declining to $12.68 within the following weeks with the subsequent potential growth to $31.48, according to the current support and resistance levels. However, its long-term dynamics and all-time high levels may become possible only after the complete restoration of the overall crypto market with the major role played by BTC and ETH. DOT’s current RSI equals 44.71 with the optimal buying opportunity may be attained when it further declines to the level of 30 or below.

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Dmytro Kharkov

Holding a Master’s Degree in Finance (Distinction), Dmytro Kharkov has proven expertise in Business Analytics, Data Analysis, and the crypto market. He has completed online courses on Machine Learning and Data Science from the leading universities and online schools. He closely monitors the latest crypto analytics insights from Glassnode, IntoTheBlock, Santiment, etc.