It has been relatively difficult for the market to focus on developments in the crypto space rather than price speculation. However, that hasn’t stopped networks like Polkadot from charging full speed ahead towards their WEB3 vision. In fact, a recent update highlighted a busy time for the network, so here’s what we can expect.
Polkadot has just confirmed the launch of the next parachain lease auctions. The announcement also confirmed that multiple governance events are planned for August. These events, combined, are likely to boost demand for DOT. This, due to the lock-in periods associated with governance and parachute auctions.
The next parachain lease auction will start today on block 11_473_600. https://t.co/hyZxkUHOXw
— Bill Laboon | W3F (@BillLaboon) August 5, 2022
In terms of DOT price action, trading volumes of the cryptocurrency have increased significantly. It is now among the top 10 cryptocurrencies by trading volume, according to WhaleStats.
Check out the top 100 whales here: https://t.co/f4ZJg8SIWe
— WhaleStats – the top 1000 BSC rich list (@WhaleStatsBSC) August 6, 2022
Now, it is not clear if the higher volumes are directly related to the announcement of the parachain lease auctions. The underlying mechanism requires projects competing for parachain slots to have a significant amount of DOT to have a decent chance of winning the parachain.
What do the tables say?
DOT is up >9% this week. This bull run led to a retest of the short-term resistance line near the $9 price level.
Although the upside has eased after retesting the resistance line, the resulting downside was limited. Investors may choose to hold their DOT, especially in light of the planned developments in August. Another possibility is that healthy DOT demand near the print time level may be canceling out most of the selling pressure.
A bearish pullback can be expected after retesting resistance. In addition to the low bearish pressure, DOT’s weighted sentiment indicated the possibility of more upside. In fact, the small retreat had already pushed weighted sentiment back into negative territory (-0.52) at press time.
Additionally, the number of contributors to Polkadot’s developer activity has grown significantly since early August. This was in line with DOT’s planned developments for the month. This is a confidence booster, especially for long-term DOT investors.
Polkadot’s August schedule is healthy for the network and DOT’s price action. It may encourage a favorable investment climate, but then, the outcome will also counter prevailing market forces.