🌎 Polkadot Sees Rare Chart Pattern Hinting at Rebound

Polkadot Price Sees Rare Chart Pattern, Hinting at Strong Rebound

Despite being 40% below its highest level in December, Polkadot’s price shows a rare chart pattern on the daily chart, suggesting a strong rebound is imminent. As a leading layer-1 network with a market cap of $11 billion and a staking yield of 12%, Polkadot has underperformed large-cap cryptocurrencies over the past few years.

Underperformance Due to Less Prominent Ecosystem

This underperformance is likely due to Polkadot’s ecosystem being less prominent compared to other chains like Solana and Ethereum. Solana is widely recognized for its meme coins and popular decentralized exchange networks, while Ethereum is known for its extensive ecosystem, including decentralized applications and numerous ERC tokens.

Polkadot 2.0 Initiative Aims to Scale the Network

However, Polkadot is working to change this as part of the Polydot 2.0 initiative, which aims to scale the network for a wide range of use cases. This includes upgrading its asset hub to support Ethereum Virtual Machine and Solidity-based smart contracts. The initiative also plans to introduce elastic scaling, enabling developers to dynamically adjust throughput, and a unified address format.

Other key upgrades planned for this year include using DOT as the universal fee token across all parachains. The developers hope these upgrades will make Polkadot the go-to blockchain for developers in industries such as gaming and decentralized finance.

Signs of Progress and Potential Benefits

There are signs that these initiatives are starting to deliver results. For example, the amount of Tether and USD Coin within Polkadot’s ecosystem’s parachains has grown by 400% over the past 12 months, reaching more than $114 million. Additionally, as an American crypto project, Polkadot may benefit from a potential Trump administration, including a spot ETF approval.

Polkadot Price Technical Analysis

The daily chart shows that the DOT price has formed two chart patterns that could drive it higher in the near term. It has formed a double-bottom pattern at $6, a widely recognized formation that often leads to bullish breakouts. Polkadot has also formed a falling wedge pattern, characterized by two descending and converging trendlines.

As a result, the coin is likely to experience a bullish breakout, with the next key level to watch being $11.65, its highest swing on Dec. 4 and 60% above the current level.