Altcoins Price Analysis

Polkadot price analysis; Indicators indicate more mutations


The price of Polkadot has risen significantly in the last 30 days and has been able to reach close to the previous historical peak. Experts believe that the development of the ecosystem of this digital currency and the conditions of derivative markets indicate the continuation of this upward trend.

to the Report Coin Telegraph The 256% increase in the price of Polkadot in the last 56 days has been astounding. At present, the 23% price of plucadat is far from the previous high of $ 49.80, however, the $ 39 billion market value of this digital currency, with a growth of 66% in the last 30 days, has performed better than Ethereum. .

Polkadot price analysis;  Indicators indicate more mutations
Polkadot price chart (6-hour view of Polkadot market / Tetra)

Polkadot connects independent blockchains designed specifically for decentralized applications through a single network. These independent fold blocks are known as parachains. The project, which focuses more on scalability, breaks transactions into smaller chunks and processes them in parallel on parachutes. This structure is similar to what we are going to see in the second version of Ethereum.

Polkadot is actually a collection of parachutes that are connected to each other through a central platform called the Relay Chain. This central layer provides network security and manages network consensus, certainty, and voting.

To support the launch of parachutes, users can vote for their projects by locking DOT tokens. The Kusama network, designed by copying Polkadot, is currently holding an auction to sell its slots. Polkadot is expected to follow suit in the next few months.

Polkadot network transactions are executed in parallel on the parachutes and are recorded on the relay at regular intervals. Each of these specific time periods is called a “slot”, and each parachute has its own slot on the relay.

Also read: What is Polkadot? Everything about the Blockchain Internet

Increase the cooperation of Polkadot and decentralized programs

The Polkadot ecosystem is constantly growing. On September 8 (September 17), SubQuery, a decentralized data collection platform, raised $ 9 million to build the first data collection layer on the Polkadot network.

Moonbeam Parachute is another example of this collaboration, which has introduced tokens using the Polkadot Substrate Development tool on the digital currency network. These tokens can be easily sent to the Ethereum network and smart contract addresses. The Moon Bean Development Team announced on September 9 (September 18) that it is working with the Lido platform. Lido is a decentralized derivative protocol for equity sharing and liquidity that was recently launched in the Ethereum and Terra networks.

The latest protocol to work with Polkadot is the decentralized exchange (dTrade). DeTrid was able to raise another $ 22.8 million for its automaker after raising $ 6.4 million in initial capital in May this year. This automated marketer is designed to create a “deep liquidity pool” and is supported by the top digital currency marketers. The liquidity pool is a place to accumulate tokens in decentralized exchanges that provide the cash needed to make transactions.

Derivatives market data indicate further price jumps

Technical analysts can quickly predict the expected price, but investors should also look at data on derivatives markets. For example, the lack of a premium for futures contracts means that investors can not easily create uptrends using leverage. Premium measures the price difference between futures contracts and current markets.

Polkadot price analysis;  Indicators indicate more mutations
Graph of the total volume of Pulkadat open futures contracts

The volume of Polkadot open futures contracts has increased from $ 360 million to $ 685 million over the past 30 days. Open futures contracts are those futures contracts that have not yet been settled. The growth in the volume of Pulkadat open futures contracts is a positive issue because it shows that traders who use leverage tend to maintain their long trading positions during the uptrend.

In the futures market, the volume of long positions (buy) and short positions (sell) are always the same, but their leverage is different. There is an imbalance in the funding rate, and in derivative markets each party to the transaction uses more leverage to moderate investment risk.

The term capitalization rate in the futures market refers to the amount of commission that long contract holders (those who believe prices rise) and short contract holders (those who believe prices fall) must pay to keep the market in balance.

The sustainable development of Polkadot will be the ultimate price driver

In the first week of September, the market enters an optimistic phase because at that time the 8-hour capital supply rate had reached 0.10%. This figure is equivalent to a weekly financing rate of 2.1 percent. However, the situation changed at the beginning of the week with a 35% drop in prices on September 7 (September 16).

Polkadot price analysis;  Indicators indicate more mutations
8-hour financing rate of Polkadot futures contracts

It may seem that the $ 22.70 price floor we saw last week has no effect on the recent uptrend, as the Pulkadat is now trading at around $ 36. However, investors’ willingness to open long leveraged trading positions has not recovered since last week’s crash.

The most likely scenario for Polkadot is a half-full glass, in which investors’ confidence increases with the further development of the project.

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