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Cryptocurrency News Articles
Polkadot (DOT) Price Prediction 2024: Can DOT Recover After a 20% Drop This Year?
Jun 25, 2024 at 11:11 pm
Polkadot price has trailed other leading layer 1 tokens in 2024 as concerns about its ecosystem remain. DOT has dropped by over 20% this year
Polkadot (CRYPTO: DOT) price has underperformed other leading layer 1 tokens in 2024 amid concerns about the relative weakness of its ecosystem.
While tokens like Ethereum (CRYPTO: ETH), Tron (CRYPTO: TRX), Toncoin (CRYPTO: TON), and BNB (CRYPTO: BNB) have risen by double digits this year, DOT has dropped by over 20%.
Here's a closer look at why Polkadot has underperformed the market and why one crypto analyst is bullish on the token despite this underperformance.
Polkadot Ecosystem Performance
One of the main reasons for Polkadot's underperformance is a general belief that it has a relatively weak ecosystem compared to peers like Ethereum and Solana (CRYPTO: SOL).
For instance, Ethereum boasts some of the largest players in the industry in its ecosystem. Some of the key protocols in the Ethereum ecosystem include Lido (CRYPTO: LDO), Maker (CRYPTO: MKR), Compound (CRYPTO: COMP), RocketPool (CRYPTO: RPL), Uniswap (CRYPTO: UNI), and Aave (CRYPTO: AAVE).
Solana, on the other hand, is home to most of the popular meme coins like dogwifhat (CRYPTO: WIF), Popcat (CRYPTO: POP), and Book of Meme (CRYPTO: BOME). It also has fast-growing decentralized exchange (DEX) exchanges like Raydium (CRYPTO: RAY), Orca (CRYPTO: ORC), and Jupiter (CRYPTO: JUP) in its ecosystem.
A look at third-party data shows that Polkadot's ecosystem has not been as vibrant. For example, Acala Network's total value locked (TVL) has dropped to around $60 million, with the amount of stablecoins in the platform at just $61,000.
Other parts of the Polkadot ecosystem like Centrifuge (CRYPTO: CFG), Interlay (CRYPTO: INTR), and HydraDX (CRYPTO: HDX) have also seen little traction among developers and investors.
Crypto Analyst Bullish On Polkadot Price
Despite this gloom, one of the more notable crypto experts has a bullish stance on the token. In an X post, Rekt Finance noted that Polkadot is his favorite layer 1 crypto right now.
He cited the fact that Polkadot had entered the artificial intelligence (AI) race through platforms like Phala Network (CRYPTO: PHA) and Origin Trail (CRYPTO: OTR).
Phala Network, a platform on Polkadot, has started to offer AI coprocessor solutions with over 34k online workers and 150,880 vCPU in its network. Its solution helps developers build AI agents that closely integrate with on-chain smart contracts.
OriginTrail, on the other hand, provides verifiable internet for AI with Decentralized Knowledge Graph (DKG). It does that by leveraging the synergies of crypto, internet, and artificial intelligence technologies. By doing that, it helps to address challenges like misinformation, data ownership, and intellectual property.
Polkadot has also moved into the Real-World Asset (RWA) tokenization, which is expected to be a multi-billion dollar industry. Some of the RWA platforms in its ecosystem are Centrifuge, Energy Web (CRYPTO: EWT), and Phyken Network (CRYPTO: PHK).
Still, while Rekt is bullish on Polkadot, its recovery will likely depend on the performance of Bitcoin (CRYPTO: BTC) and the vibrancy of its ecosystem.
Disclaimer:info@kdj.com
The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research!
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