Alternative blockchains seek to provide an answer to scalability concerns that have preoccupied most of the blockchain space. Chain agnostic blockchains such as PolkaDot aim to resolve the much-debated topic of interoperability. Cardano, Solana or PolkaDot, are all regarded as “Ethereum-killers,” yet Ethereum still undermines their usability. Moreover, the current financial phase of cryptocurrencies halts investment opportunities
PolkaDot Finding Support
In the fast-paced, innovative crypto space, “soon” is comparable to an empty promise. PolkaDot has yet to launch their parachain auction, something Kusuma already accomplished by selecting its first winner allocation. Additionally, Twitter sentiment acknowledges that implementing parachains across space expands adoption on the institutional and enterprise level.
Still, while innovations can occur in moments of market inactivity, they can go without notice. Trader Fred, a cryptocurrency trader who emphasized altcoins such as PolkaDot and others, requires Ethereum to show positive activity with increased trading volume. Additionally, he argues that “Q3 hasn’t historically been a great quarter,” which could indicate why the price of DOT has moved sideways for the past month.
Institutional enthusiasm for cryptocurrencies has come to a halt as the leading cryptocurrencies are seeing record outflows. Coinshare research highlights Ethereum products suffered a weekly outflow of $50 million, the largest since 2015, reverberating to investors’ anxieties. Trader Fred emphasized that sentiment is similar across most altcoins, as investors still lack confidence.
Cautioning For Investors
PolkaDot is the “hottest blockchains right now” yet, price activity and sideways trading make all the crypto environment interesting for only a few. Institutional investors analyze their purchases based on the fundamental values of the project; however, market volatility and fear decrease investment opportunities. Thus, outflows from crypto investments are the main indicators of the lack of trust in the market.
Furthermore, PolkaDot’s price activity does not indicate investors are increasing their positions. DOT still hovers around the support level, and lack of volume hinders its ability to close above resistance. As highlighted by The Wolfonaire, the delay in releasing Parachains puts DOT in a dangerous place. If inactivity and lack of trust continue, DOT could lower to the $12.50 level.
On the Flipside
PolkaDot is Still Bullish for Developers
The PolkaDot ecosystem is evolving despite deployment delays for parachains. Parachain as a multi-chain system provides more than just scalability advantages for users. Mark Cuban argued that “DeFi is like the early days of the internet,” and with high fees on Ethereum, new blockchain and integrations fit the ecosystem better.
PolkaDot has a “ready-made suit” for projects that are ready to launch. Thus, the launch bears more importance than a regular main-net launch, as it is a catalyst for attracting new developers to the project. To that end, the delay is well-founded and is in the best interest of both PolkaDot and future developers.
Amara Finance, a PolkaDot “loan service provider,” offers what Mark Cuban was debating, namely DeFi. As new ecosystems launch and attract developers from Ethereum, DeFi can challenge financial products and make it more attainable for regular users to interact with.
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Source: Cryptocurrency - investing.com
