Polkadot Price Prediction 2024: DOT Price Analysis
What's next for Polkadot?
Key Takeaways
- The Polkadot blockchain and its native token DOT suffered during the first half of 2024.
- The platform announced that it was starting work on its next stage of development, Polkadot 2.0.
- Our price predictions suggest that the rest of 2024 could be bearish for DOT.
Polkadot has had a tough few months. Although the United States Securities and Exchange Commission (SEC) does not consider it an unregistered security, the news that the SEC was suing the Binance and Coinbase crypto exchanges hit it badly.
However, there has been some encouraging news since then. The network, which allows people to create their blockchains, announced that Polkadot 1.0 was completed, setting the stage for Polkadot 2.0.
The news was tempered somewhat by the fact that it was not made entirely clear what Polkadot 2.0 would involve. The blockchain’s co-founder, Gavin Wood, suggested that it might involve allowing people to pay for the time they use rather than the technology they are using.
In October 2023, Wood’s Web3 Foundation announced that it would invest 20 million Swiss Francs and five million DOT in Polkadot’s development community.
In January 2024, Polkadot unlocked 26 million DOT.
On Aug. 19, 2024, DOT was worth about $4.40.
Let’s examine our price predictions for DOT, made on Aug. 19, 2024. We will also examine the DOT price history and discuss what Polkadot is and does.
Polkadot Price Prediction
CCN used the wave count method to form its Polkadot crypto price predictions. To refine our forecasts and establish the maximum and minimum DOT price predictions, we’ve added 20% to the targets.
| Minimum DOT Price Prediction | Average DOT Price Prediction | Maximum DOT Price Prediction | |
|---|---|---|---|
| 2024 | $2.10 | $2.60 | $3.10 |
| 2025 | $21.80 | $27.90 | $34 |
| 2030 | $16 | $20 | $24 |
The most likely wave count suggests that DOT completed a five-wave increase starting in September 2020 (white). The increase led to the all-time high price of $55.08 in October 2021.
The price of DOT has fallen since, correcting in what likely is an A-B-C structure (black). Based on the duration of wave C, we can predict another slightly lower low before the trend eventually reverses.
After the decline is over, it is unclear if what follows will be a five-wave increase or an A-B-C structure. Since both would take DOT to at least the 0.618 Fibonacci retracement resistance level, we will predict an increase that takes it there.
During these projected upward and downward movements, the wave count method gives DOT price predictions of $2.60 and $27.90 for the end of 2024 and 2025, respectively.
For the Polkadot price prediction at the end of 2030, we will use the daily rate of increase since launch. DOT has increased by 213.50% since August 2020, for a daily rate of 14%. Projecting this until the end of 2030 leads to a DOT price prediction of $20.
Polkadot Price Prediction 2024
The wave count gives a DOT price prediction range between $2.10 and $3.10 for the end of 2024.
Polkadot Price Prediction 2025
The wave count gives a DOT price prediction range between $21.80 and $34 for the end of 2025.
Polkadot Price Prediction 2030
Using the daily rate of increase we arrive at a DOT price prediction range of between $16 and $24 for the end of 2030.
Polkadot Price Analysis
The daily chart for DOT gives an undetermined outlook. DOT has declined under a descending parallel channel since March. While it bounced at its support trend line in August, creating a long lower wick (white icon), it still trades below its midline, which provides resistance.
Also, technical indicators are mixed. The daily RSI is increasing but is still below 50, while the MACD has a similar upward trend but is below 0.
So, both a breakout from the midline and a rejection are possible.
Short-Term Polkadot Price Prediction
The Polkadot price prediction for the next 24 hours depends on whether the price reclaims the channel’s midline or falls below it instead. If it moves above it, it can increase toward the channel’s resistance trend line at $5.
Conversely, a rejection can trigger a downward movement toward the support trend line at $3.30.
Polkadot Relative Strength Index (RSI)
The Relative Strength Index (RSI) is a momentum indicator traders use to determine whether an asset is overbought or oversold. Movements above and below the 50 line also indicate if the trend is bullish or bearish. On Aug. 19, 2024, the Polkadot’s RSI was 36, indicating a bearish sentiment.
Polkadot Average True Range (ATR)
The Average True Range (ATR) measures market volatility by averaging the largest of three values: the current high minus the current low, the absolute value of the current high minus the previous close, and the absolute value of the current low minus the previous close over a period, typically 14 days.
A rising ATR indicates increasing volatility, while a falling ATR indicates decreasing volatility. Since ATR values can be higher for higher-priced assets, normalize ATR by dividing it by the asset price to compare volatility across different price levels.
On Aug. 19, DOT’s weekly ATR is 1.02, implying low volatility. It has fallen since the beginning of the year. As a proportion of the DOT price, the ATR is 0.23.
Best Days and Months to Buy Polkadot
We took a look at the DOT price history and found the times when the price was at its lowest across certain days, months, quarters, and even weeks in the year, indicating the best times to buy Polkadot.
| Time to Buy DOT | Period |
|---|---|
| Best Day | Saturday |
| Best Week | 3 |
| Best Month | February |
| Best Quarter | First |
Polkadot Price Performance Comparisons
Advantages and Disadvantages of Polkadot
CCN’s Senior Research Analyst, Toghrul Aliyev, took a deep dive into Polkadot and found the following advantages and disadvantages.
Advantages of Polkadot
- Growth-Driven Inflation Model : Polkadot’s Dynamic Staking Incentive Model targets an ideal 60% staking rate of the total token supply. When staking falls below 60%, the system increases rewards to encourage more staking. Conversely, when staking exceeds 60%, the system reduces rewards, and inflation starts to eat into returns, making it less profitable. The model balances network security, token liquidity, and expansion and incentivizes network participation.
- High Decentralization Level : 93 out of 297 active Polkadot validators control 33% of the total staked token supply. The wide distribution of tokens among validators indicates a high level of decentralization in the network.
- Advanced Cross-Chain Interoperability: Polkadot uses a central Relay Chain to connect multiple specialized blockchains (parachains). The design allows parachains like Moonbeam to run Ethereum-compatible smart contracts while they benefit from Polkadot’s shared security. The system also includes bridge protocols for interaction with external networks such as Bitcoin and Ethereum. Polkadot leverages the Substrate framework for custom blockchain development. This approach creates a flexible, scalable ecosystem where diverse blockchains can collaborate and share data. These blockchains maintain their features and security while participating in the broader network.
- Advanced Interoperability: Polkadot connects multiple specialized blockchains (parachains) through its central hub, the Relay Chain, allowing them to share data and assets. For example, Moonbeam is a parachain on Polkadot that supports Ethereum-compatible smart contracts.
Development, Governance, and Scaling
- Strong Development : Polkadot ranks 5th with 20,741 repositories, 3rd with 484 sub-ecosystems, 7th with 6,270 weekly commits, and 3rd with 923 weekly active developers. The high rankings indicate a vibrant ecosystem with robust developer participation and continuous platform enhancements. Active development typically results in accelerated innovation, improved functionality, and enhanced network reliability.
- Democratic Governance : Polkadot’s OpenGov system allows all DOT holders to participate in decision-making, ensuring no single entity or group holds disproportionate power. The platform can also run several referenda simultaneously, speeding up and enhancing governance efficiency. Finally, once a decision is made, the system automatically implements it without requiring manual intervention (automatic enactment).
- Elastic Scaling : Polkadot’s elastic scaling improves scalability by processing multiple parachain blocks in parallel while using the Relay Chain for direct validation, which maintains security and avoids bottlenecks. In contrast, Layer 2 solutions handle most transactions off-chain and periodically settle on the main chain, which can lead to security concerns and synchronization delays. Elastic scaling is like a highway with multiple lanes for different types of traffic, all monitored by a central traffic control system. Layer 2 solutions are like side roads that merge with the main highway, potentially causing traffic jams and requiring additional security checks.
Disadvantages of Polkadot
- Centralized Token Distribution : Over 50% of Polkadot’s total supply belongs to the top 50 wallet holders. The concentration of tokens in a few hands threatens network security and governance, as it grants disproportionate power to a small group of holders who could potentially manipulate the system for their benefit.
- Low Adoption Rate : Polkadot 2.0 faces significant challenges in user engagement, with only about 40,000 daily transactions and approximately 4,500 daily active users.
- Intense Competition: Although Polkadot is a Layer 0 blockchain, it still competes in a crowded space of general-purpose smart contract Proof-of-Stake blockchains.
- Limited Parachain Slots: With only 100 available slots, projects must compete fiercely to secure a place on the network. The competition can drive up the cost of acquiring a slot, making it difficult for smaller or less-funded projects to participate.
- Unbonding Period: Polkadot’s 28-day token lock-up period during the unbonding process means that stakers cannot access their tokens or earn rewards. An extended unbonding period can reduce liquidity and flexibility for users. This is because they cannot quickly respond to market changes or reallocate their assets to other opportunities.
- Crowdloan Lock-Up: Participating in Polkadot’s crowd loans requires users to lock up their DOT tokens for the duration of the parachain lease period, which can be up to 96 weeks. During this time, users do not earn rewards on their staked tokens.
- High Learning Curve and Complex User Experience: Polkadot’s intricate architecture presents a significant challenge for average users. The difficulty of understanding and using the platform effectively prevents many newcomers from adopting it, which in turn limits its potential to attract and retain a broad user base.
Polkadot Price History
Following that, let’s examine some of the key dates in the Polkadot price history . While past performance should never be taken as an indicator of future results, knowing what the coin has done can give us some very useful context when making or interpreting a Polkadot price prediction.
2020-2021: The Polkadot price launched in August 2020 and immediately increased. After a brief decline in May 2021, the price resumed its ascent and reached an all-time high in November. DOT closed the year at $28.
2021-2024: Unfortunately, the price of DOT has been mired in a lengthy downward trend for the past three years, without experiencing notable bounces. While this trend seemingly changed in August 2023, DOT has retraced all of its previous gains. As of Aug. 19, 2024, DOT trades at $4.41.
| Time period | Polkadot price |
|---|---|
| Last week (Aug. 12, 2024) | $4.57 |
| Last month (July 19, 2024) | $6.33 |
| Three months ago (May 13, 2024) | $7.57 |
| One year ago (Aug. 7, 2023) | $4.43 |
| Launch price (Aug. 21, 2020) | $2.89 |
| All-time high (Nov. 5, 2021) | $53.88 |
| All-time low (Aug. 21, 2020) | $2.89 |
Polkadot Market Cap
The market capitalization, or market cap, is the sum of the total number of DOT tokens in circulation multiplied by their price. On Aug. 19, 2024, Polkadot’s market cap was $6.18 billion, making it the 19th-largest crypto by that metric.
Who Owns the Most Polkadot (DOT)?
The anonymous wallet with the most DOT held 7.71% of the crypto’s supply on Aug. 19, 2024.
Richest DOT Wallet Addresses
On Aug. 19, 2024, the five wallets with the most DOT tokens were
- 16ZL8yLyXv3V3L3z9ofR1ovFLziyXaN1DPq4yffMAZ9czzBD. This wallet held 85,092,234 DOT or 7.71% of the total supply.
- 15j4dg5GzsL1bw2U2AWgeyAk6QTxq43V7ZPbXdAmbVLjvDCK. This wallet held 32,506,305 DOT or 2.95% of the total supply.
- 13Z7KjGnzdAdMre9cqRwTZHR6F2p36gqBsaNmQwwosiPz8JT. This wallet held 23,492,835 DOT or 2.13% of the total supply.
- 1743nDTMZisPgBCYSAgkUn1kVG7MePc9rvMEjoRNf4ipVkF. This wallet holds 21,222,653 DOT or 1.92% of the total supply.
- 12xtAYsRUrmbniiWQqJtECiBQrMn8AypQcXhnQAc6RB6XkLW. This wallet held 20,337,758 DOT or 1.84% of the total supply.
Polkadot Supply and Distribution
| Supply and distribution | Figures |
|---|---|
| Total supply | 1,480,825,679 |
| Circulating Supply (on Aug. 19, 2024) | 1,401,825,679 (95% of total supply) |
| Holder distribution | Top 10 holders own 24% of the total supply as of Aug. 19, 2024 |
From the Polkadot Whitepaper
Polkadot has two pieces of technical documentation: a detailed whitepaper and a more accessible light paper . Both say that Polkadot is designed to allow data to be transferred between blockchains.
The light paper says: “By bringing together the best features from multiple specialized blockchains, Polkadot paves the way for new decentralized marketplaces to emerge, offering fairer ways to access services through various apps and providers.”
Polkadot (DOT) Explained
If the blockchain is king in the world of crypto, then it makes sense that someone might want to build their own blockchain. If a cryptocurrency has its blockchain, it means that it is a coin, not a token, giving it credibility in some investors’ eyes. Not only that, but running a blockchain can give developers more control over their platform.
Polkadot is a platform that allows people to build their own blockchains. The conveniently named Polkadot (DOT) coin supports the network.
How Polkadot Works
The Polkadot blockchain is essentially two types of blockchain in one. The main chain is called the relay chain, and transactions are permanent there. The other sort of chain is para chains, which are the networks set up by Polkadot’s users.
Polkadot can handle more than one transaction at a time. This means, at least in theory, that it is quicker and, by extension, cheaper than some of its rivals.
The blockchain uses a form of the Proof-of-Stake (PoS) consensus mechanism called Nominated Proof-of-Stake (NPoS) to secure the network and add blocks to the blockchain. In NPoS, people who hold DOT can stake the coin to add blocks but nominate others to serve as validators.
There are three different sorts of DOT holders on the blockchain. Validators run the computers, or nodes, that help the system run. Nominators help nominate validators and get a portion of the DOT the node runners earn, while Collators monitor transactions on the para chains and report them to validators.
DOT holders can also vote on how Polkadot is run. People can also buy, sell, and trade the coin on exchanges.
Is Polkadot a Good Investment?
It is difficult to tell. Although Polkadot 2.0 is undoubtedly exciting, that anticipation should be tempered because we don’t entirely know what it will look like.
That said, DOT is one of the larger, more solid crypto platforms out there. It has managed to bounce back from adversity before and has followed the market in an upturn over the last few weeks.
The fact that it is not on the SEC’s list of potential crypto unregistered securities should also be considered a positive for the coin.
Meanwhile, the news of the Web3 Foundation’s grants shows a commitment to the Polkadot development community.
On the other hand, its performance so far this year has been less than stellar. Investors may want to consider their options when deciding where to put their money.
As always with crypto, you should do your research before deciding whether or not to invest in DOT.
Will Polkadot go up or down?
No one can tell right now. While the Polkadot crypto price predictions are largely positive, price predictions have a well-earned reputation for being wrong. Keep in mind that prices can and do go down and up.
Should I invest in Polkadot?
Before you decide whether or not to invest in Polkadot, you will have to do your research, not only on DOT but on other related coins and tokens such as Cosmos (ATOM) and Polygon (MATIC). Either way, you must also ensure you never invest more money than you can afford to lose.
FAQs
Will Polkadot reach $100?
It might do but, if it does, it won’t be for a while. Price predictions based on technical analysis expect it to reach a triple-figure value in the next decade.
Keep in mind that DOT has never reached $100 before, with its all-time high of $55 coming in early November 2021.
What is Polkadot used for?
DOT is used to help secure the Polkadot blockchain, allow people to vote on proposals to the network, and reward the system’s users. It can also be bought, sold, and traded on exchanges.
