- Polkadot’s TVL did not follow the rest of the metrics as it went up in Q2.
- At press time, DOT was down by nearly 7%, but a few market indicators were bullish.
Polkadot [DOT] had a rough second quarter as its price only registered a decline in the last three months. Messari recently posted a report revealing the blockchain’s state in Q2, which highlighted its performance on multiple fronts.
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In the last quarter, the most notable development for the blockchain was the launch of OpenGov. Though there were multiple developments, its price trajectory did not follow. Will Q3 also look the same, or will it have something to offer the investors?
Major Polkadot updates in Q2
Polkadot’s Q2 started with a decline in its value. However, the quarter had a few major network updates that added much value to the blockchain. First and foremost was the launch of Polkadot’s OpenGov.
With concurrent referenda, community-centered governance bodies, and improved delegation flexibility, Polkadot’s new fully decentralized governance architecture, OpenGov, enabled a more effective and transparent decision-making process.
The quarter also witnessed the launch of XCM v3. Its new iteration of the messaging format introduces advanced programmability, bridging capabilities with external networks, cross-chain locking, improved fee payment mechanisms, and support for NFTs. Apart from that, Acala and Moonbeam also released their parachain slots.
A check on the Polkadot network’s state in Q2
Though there were multiple promising launches in the ecosystem, that did not help uplift the blockchain’s network activity. Polkadot’s daily active accounts declined from 6.29k in Q1 to 5.81k in Q2.
A similar declining trend was also seen in terms of daily new accounts, which had a figure of over 1.3k in the second quarter.
Source: Messari
The blockchain’s revenue also registered a decline in the last quarter. As per the report, the blockchain had revenue of over $120 thousand in Q1, which fell to nearly $81 thousand in the second quarter of the year.
A look at Polkadot’s forte
According to the Electric Capital Developer Report, Polkadot has one of the largest developer bases in the cryptocurrency sector, with over 750 full-time developers and 2,000 total developers.
Polkadot has made large investments in projects like the Polkadot Blockchain Academy, which is preparing for its third cohort wave in Berkeley, California, to advance its developer community.
However, this did not reflect on the blockchain’s development activity, which plummeted over the last three months, as evident from Santiment’s chart.
Source: Santiment
Nonetheless, despite dips in multiple metrics, the blockchain’s network value witnessed growth in the last quarter. As per DeFiLlama’s data, Polkadot’s TVL has gained upward momentum since the beginning of the quarter, which is an optimistic development.
Additionally, Polkadot’s parachain Moonbeam concluded the quarter with a TVL of $60 million, leading the second-ranked parachain by more than double the value. Acala, Astar, and Parallel, the next three parachains, all retained TVL figures in the $20 million range.
Source: Messari
How is DOT doing in Q3?
The beginning of Q3 was also not what several expected, as the quarter began with a drop in the token’s price as well. According to CoinMarketCap, DOT was down by nearly 7% in the last seven days.
At the time of writing, it was trading at $5.12 with a market capitalization of over $6.1 billion, making it the 13th largest crypto.
After an increase, its development activity also went down, which was also a negative signal. However, its popularity remained high, as evident from its stable social volume.
DOT’s weighted sentiment also improved, suggesting that positive sentiment was dominant in the market. On top of that, DOT’s Open Interest registered a decline on 11 July, increasing the chances of a trend reversal in terms of its price action.
Source: Santiment
Read Polkadot’s [DOT] Price Prediction 2023-24
A look at DOT’s daily chart gave hope for better days ahead, as a few market indicators were in the bulls’ favor. For instance, the Money Flow Index (MFI) gained upward momentum.
The Exponential Moving Average (EMA) Ribbon also displayed possibilities of a bullish crossover soon, increasing the chances of a price uptrend in the coming days. On the contrary, the Chaikin Money Flow (CMF) went the other way, which could restrict the token’s price from moving up in the near term.
Source: TradingView
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