Polkadot (DOT) price has increased by 200% in less than eight days and top crypto analysts believe the blockchain has a lot more to give.
Spartan Black, a major cryptocurrency fund based in Asia, believes Polkadot (DOT) has more fuel left in the tank and could soar into the top-3 list of biggest cryptocurrencies by market capitalization.
Currently, the popular protocol is listed as the sixth-largest cryptocurrency by market capitalization at CoinGecko.
Since listing on Binance eight days ago, the price of DOT soared by more than 200% and many analysts believe the price could rise significantly higher.
DOT/USDT daily chart. Source: TradingView.com
There are several favorable factors buoying the sentiment around DOT. The protocol does not directly compete against the Ethereum Network, it scales rapidly, and as a result, could offset the issue of high fees on Ethereum.
Polkadot’s market cap is at $5.6 billion, so what will fuel further growth?
DOT has seen meteoric growth in recent weeks in terms of both valuation and projects. Data from PolkaProject shows there are 197 projects in the Polkadot ecosystem already.
Apart from having strong technologies, Polkadot also has arguably one of the most decorated developers within the smart contracts space.
Gavin Wood created Polkadot in 2016 and is a key figure behind the development of Ethereum’s solidity programming language and Parity Technologies. Wood also played a key role in the growth of the Ethereum Network over the past four years.
The combination of an active community, a growing number of projects in the ecosystem and Wood’s involvement appear to be driving the demand for DOT.
Spartan Black’s Kelvin Koh predicted in mid-August that DOT would hit $5 based on the market capitalization of Cardano. Within weeks of the prediction, DOT surpassed $5, rising to as high as $6.57. At the time, Koh said:
“If ADA’s market cap is $3.8B, then Polkadot should be worth at least $5B i.e. $5 per DOT.”
As a follow up prediction, Koh said that he expects DOT to become a top three cryptocurrency on Coingecko and CoinMarketCap. He stated:
“Another prediction: within a year DOT will be Top 3 market cap on Coingecko/CMC.”
Not competing against Ethereum is an important factor
Ethereum has been by far the most dominant smart contracts blockchain protocol to date. It has a valuation of $43 billion, followed by DOT at $5.6 billion.
Polkadot does not directly compete against Ethereum, and as Koh explained, the long-term prosperity of DOT should not result in a decline of Ethereum.
Blockchains, like Polkadot and Cosmos, which enable multiple blockchain networks to exist on their protocols, are structurally different from Ethereum. Koh explained:
“I believe in a multi-chain world interconnected by bridges. Polkadot and Cosmos will not replace Ethereum. Also wouldn’t rule out chains like Near, Solana, AVA, TRON and others seeing development activity.”
If Polkadot, along with other smart contracts protocols, can co-exist with Ethereum, it raises the chances for long-term survivability.
Major exchanges have already listed DOT after its major denomination change, showing support for the cryptocurrency. Even exchanges in the United States, including Kraken, listed DOT quickly after its launch.
Blocktown Capital’s Joseph Todaro said:
“Kraken listing Polkadot before Coinbase and Binance US has been a massive win. If you are in the US and want DOT exposure Kraken is where you have to go.”