Polkadot (DOT) sees massive spike in the market

August 16, 2021

Polkadot (DOT) has been making waves in the altcoin market, with developers and investors interested in both the technological and financial prospects of the project. With the correction hitting the cryptocurrency market hard in May, DOT has been trading quietly, but the price of the altcoin recently saw a major spike to reclaim above $20.

Source: Coinmarketcap

Looking at the chart, it’s easy to see that the price of Polkadot has seen a steady increase over the past seven days of trading, with a sharper increase in the past 24 hours. Moving from a low of $19.96 to a high of $24.43 in the past week, the token is looking at 22% increase. While DOT is still nearly 60% below its all-time high of $60, the upwards trajectory might spell bullish signs for the altcoin.

What is Polkadot (DOT)?

Polkadot is a project based on the blockchain designed with interoperability at the core – that is, it is aimed to be able to work with other blockchains interconnected. It’s referred to as “the blockchain of blockchains” because it is able to connect blockchain to other blockchains; a new idea in the market and one that is going to take the sting out of limited transaction speeds and congested blockchains.

It uses sub-chains called parallel chains (or parachains) with chains built with a specific application in mind. It’s designed to ease the process of development where development teams can build easily on the project’s blockchain without slowing down or impacting other blockchains in the process.

Polkadot (DOT) gaining investment

Almost three weeks ago,  Karura Swap was launched as the first decentralised exchange (DEX) on Polkadot’s blockchain. Created by Acala, the project has been backed by Coinbase Ventures. The launch of the exchange emphasises the possible protocols and applications that can be launched as part of Polkadot’s network.

From a technical point of view, the charts are projecting a possible bull run for the token. From a derivative stane, the future is looking neutral and could go either way. If the future contract’s premium does not exist, it means that the investors are not content to look at going long by using leverage. However, if the interest in futures contracts opens up, the network could see more long-buyers and balance out the short-term traders looking to sell. This, in turn, would project a healthy incline for the price of the altcoin that can be sustained despite any wobbles in the market.