- Polkadot’s development activity has clinched an all-time high.
- DOT’s price, on the other hand, continued to trend downward as interest dropped to an all-time low.
Development activity on Layer 0 blockchain Polkadot [DOT] has reached an all-time high, while interest in its DOT coin continues to plummet, data from Token Terminal revealed.
📊@Polkadot core protocol development activity is at ATH, while the interest for $DOT is at ATL pic.twitter.com/Yi2lHLkxba
— Token Terminal (@tokenterminal) July 27, 2023
Read Polkadot’s [DOT] Price Prediction 2023-24
Development activity is an important metric as it offers insights into a crypto project’s commitment to creating a working product and the likelihood of shipping new features. In addition, a high development activity often reduces the possibility of the project being an exit scam.
This metric tracks the number of unique development activity contributors, the count of all events for a project, and the number of unique GitHub activity contributors.
According to data from Token Terminal, in the last year, the core developer count on Polkadot has increased by 39%.
What has Polkadot been up to?
The uptick in developmental activity on the Polkadot network this year can be attributed to the two significant technical upgrades made to the Layer 0 chain in the past few months – the release of Polkadot v0.9.43 and the launch of XCM v3.
In January, following 15 months of development, Polkadot launched the third iteration of its cross-consensus communication format (XCM). The V3 upgrade introduced a number of new features, including support for cross-chain message passing (XCMP), which allows for the transfer of data and tokens between different blockchains.
After exactly 15 months in development, @polkadot XCM version 3 is merged. This enables bridges, cross-chain locking, exchanges, NFTs, conditionals, context-tracking and more. https://t.co/dqcLXOmDa9
— Gavin Wood (@gavofyork) January 17, 2023
Also, Polkadot’s v0.9.43 upgrade was released on June 20 and introduced two new features to the blockchain network. These are database migrations and runtime migrations. Database migrations allow for the upgrade of the database to the latest state, while runtime migrations allow for the upgrade of the runtime of a parachain.
THREAD – @Polkadot #PolkadotDigest 20 June 2023#Polkadot News
Polkadot version 0.9.43 has been released with MEDIUM upgrade priority. https://t.co/l8bOvJjPtb
— Bill Laboon | Web3 Foundation (@BillLaboon) June 20, 2023
Interestingly, despite these attempts to improve the efficiency of Polkadot to drive up network user activity, the active address count of the chain has dropped. As a result, transaction fees have trended downward in the past few months.
According to Token Terminal, daily transaction fees paid to use Polkadot have fallen by 15% in the past six months. During that period, protocol revenue from fees has also suffered a hit.
Source: Token Terminal
DOT deals with neglect
At press time, DOT exchanged hands at $5.24, experiencing a 21% drop in value in the past six months. Things appeared gloomier on the daily chart, with key indicators signaling severe bearishness in the DOT market.
For example, a new bear cycle was underway at press time and has been so since the beginning of the month.
According to the alt’s Moving Average Convergence Divergence (MACD) indicator, the trend line (orange) intersected the MACD line (blue) in a downtrend on 10 July, indicating that the bears regained control of the DOT and have since begun to distribute their DOT holdings.
Further, the coin’s Chaikin Money Flow (CMF) was positioned below the center line at -0.04. Typically, a CMF value below the zero line is a sign of weakness in the market as it signals liquidity exit and often precipitates further price declines.
Source: DOT/USDT, TradingView
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Interestingly, despite increased coin distribution since the beginning of the month, an assessment of its Open Interest revealed an uptick.
However, a closer look at DOT’s funding rates across cryptocurrency exchanges revealed that most of the trade positions opened in the last month were against the coin’s price.
Source: Coinglass