According to blockchain research group, House of Chimera, the Polkadot [DOT] ecosystem has experienced significant growth in terms of social engagement. Whether genuine or artificial, social engagement in the crypto market captures the sentiment around a project.
So, the surge in the metric suggests that Polkadot has become a project a large part of the crypto populace was watching. In the post, House of Chimera explained that there were reasons for the goodwill.
According to the advisory firm, Polkadot’s growing partnership with other protocols, as well as certain upgrades have helped it get to this point.
Polkadot keeps the work going
A look through Polkadot’s X handle showed that it was engaged in collaborating with other projects. For example, the protocol recently announced that it partnered with Manta Network.
Also, there was another one which involved onboarding a security audit project. Furthermore, the addition of five new parachains in October 2023 contributed to the hike. A Parachain runs parallel to the Polkadot relay chain.
These upgrades were some of the reasons Polkadot has stayed as one of the top projects with a high development activity. However, AMBCrypto reported a few days back that Polkadot had fallen behind Cardano [ADA] on the pecking order.
Despite the drop, Santiment data showed that DOT was doing well social dominance-wise. Social dominance gauges the share of discussions a project has compared to others with a large market cap.
At press time, DOT’s social dominance was 0.629%. This reading suggests that discussions around Polkadot increased, and were published in the media.
Sentiment favors the token
It was also a similar situation with the Weighted Sentiment. On the 28th of January, the Weighted Sentiment was -0.703, indicating that participants were not bullish on DOT. But as of this writing, the tides had changed, and the metric was positive.
The positive reading here implies that the players’ perception of DOT was a bullish one. But has this in any way reflected on the price action?
At press time, DOT changed hands at $6.96. This value was a 15.08% increase in the last seven days. If DOT continues this performance, then the $15 prediction AMBCrypto talked about could come to pass.
In the meantime, on-chain data revealed that DOT’s volume has been increasing since the 27th of January.
During that time, the volume was 137.74 million. However, press time data showed that DOT’s volume had increased to 334.85 million.
Regarding the price action, if the volume continues to increase, DOT could target $9 next. But if profit-taking comes in, a move back to $6 could be possible.
Source : AMBCrypto by Victor Olanrewaju / Jan 31, 2024