Why Is Polkadot (DOT) So Cheap?

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Last Updated January 13th 2022
7 Min Read

Why is Polkadot so cheap? At the moment, Polkadot (DOT) can be said to be rather cheap because it is a relatively new cryptocurrency - a little more than a year old, it has no real value, and its demand hasn’t been strong enough to incite a material price breakout.

We must, however, appreciate the fact that, though new, Polkadot token price has come a long way in getting where it is today. Further, we must observe that Polkadot has always been in demand - as evidenced by the November 2021 DOT token price rally. It is only that this demand was enough to force a rally and earn DOT token a place on the top 10 largest cryptocurrencies - just not enough to help it escape the low price levels.

So, will it rise again and escape the low prices? Better yet, should you invest in Polkadot while it is still lowly priced?

We answer these questions and tell you if Polkadot is worth buying in this DOT token investment guide.

First, though, we look at the Ethereum Killer’s price history.

Polkadot (DOT) Price History

Polkadot token launched on 20th August 2020 and ended the first day of trading, valued at around $2.69. It was quickly picked up by the crypto community, which helped push its value to $6.6 within the first 10 days of active trading. However, it quickly slipped and traded at between $3 and $5 from September to 29th December 2020, when it to rose past $6 again.

Like most altcoins, we now know that Polkadot prices are not immune to changes in the crypto market direction. By December, a crypto market rally was looming, and the lead coins - Bitcoin, Ethereum - had already packed enough momentum and headed for a breakout.

According to CoinMarketCap, the price rally fever caught up with the Polkadot token in late December 2020. With minimal disruption, it pushed DOT token prices above $10 on 7th January 2021, a break above $20 on 4th February, and to a high of $49.69 on 15th May. In November 2021 DOT topped that, reaching a new all-time high of $55.00.

At the moment, DOT prices are gliding in a downtrend. For the past 30 days, for instance, the coin has been ranging between $22.60 and $32.77.

At the time of writing, Polkadot is trading at $27.08, which gives it a live market cap of $26 Billion with a circulating supply of 987.57 Million DOT tokens.

But what is keeping the DOT token prices low?

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Why is Polkadot so Cheap?

Polkadot has everything going for it, and the fact that it still is a relatively new cryptocurrency may be the only reason why it is cheap and it has not been able to escape the low price levels.

What does it have going, you might ask? Well, it featured prominently among the fastest growing blockchain in 2021 in that it managed the number of developers working on the network in the last 12 months.

Polkadot was also the fastest-growing cryptocurrency for 2021, having grown its prices by more than 1800% at its peak. Its daily trading volumes have also increased from $82 Million on its first day of trading (according to Coingecko) to as high as $17 Billion.

To explain how the fact that Polkadot is new may be keeping its prices low, we compare it to Ethereum’s price growth. Coingecko records ETH’s earliest price as $2.83 on 7th August 2015. But despite being more scalable and charging lower transaction fees than Bitcoin (the dominant cryptocurrency then and even now), it would remain within the low price range for close to two years. It only broke above $100 in May 2017. Four years later, it has hit an all-time high of $4,891.70.

Polkadot is currently more scalable, has more possible use cases, and charges lower transaction fees than Ethereum - hence the “Ethereum Killer” tag. This says that Polkadot may be going through the familiarity and early adoption phase. And that as more users get on board, the Polkadot blockchain and investors understand its potential, its prices will soar to rival Ethereum’s.

Read Also: Polkadot Price Prediction – Will DOT Price Increase in Future?

Should I Buy Polkadot (DOT) While It Is Still Cheap?

The decision to invest in Polkadot should be personal and informed by such factors as your understanding of the altcoin, risk tolerance, and trading experience. But the Ethereum analogy says you should buy Polkadot while it is still low because it is bound to make parabolic upward price movements.

Given the coin’s disruptive blockchain technology, it is highly likely that it may never fall to the current lows once its adoption peaks. By buying DOT tokens while they are still cheap, you could be setting yourself up for huge profit margins in the near future, as estimated by most price prediction websites and crypto analysts.

Is Polkadot (DOT) Worth Buying?

Polkadot is worth buying today because it is lowly priced has one of the most promising futures. Crypto market analysts and virtually every other price indicator point to a promising DOT token future. They estimate that the Polkadot token prices will eventually revert and break above the current all-time high. And that the Polkadot blockchain will soon achieve massive adoption, creating the demand needed to help its token escape the low price ranges.

Will Polkadot (DOT) Bounce Back?

Yes, Polkadot token analysis and technical analysis reports point to an eventual rebound that helps DOT prices break above the current all-time high and into an uptrend. The majority of analysts are especially confident that the DOT token will break above $100 in the next few years.

These analysts, however, can’t seem to agree on how soon Polkadot will bounce back and how high up it will reach during this time.

Crypto market experts at Coinpedia, for instance, are not convinced that Polkadot can break above its current ATH in the next few months. They are nevertheless confident that the altcoin will bounce back and rise to $126 by the end of 2026.

Wallet Investor, a cryptocurrency price prediction website that uses technical analysis to forecast future coin prices, indicates that Polkadot will bounce back and breach the current all-time high as early as February this year. It estimates that DOT tokens will be selling for $84.49 in December 2022 before rising to around $154.27 by December 2026.

CryptocurrencyPricePrediction website has an optimistic view of Polkadot’s future price action. While using technical analysis to estimates DOT token prices, the website indicates that Polkadot will proceed with the price gain to reach $60 in May 2022.

By December 2025, its analysis shows that Polkadot will be selling for $368.03, before doubling this value and reaching $1,036.70 by December 2030.

Check Out: Will Polkadot (DOT) Make Me Rich?

Conclusion: Why Is Polkadot (DOT) So Cheap?

Polkadot is cheap it is relatively new and is still in the early adoption stage. But developers have been trooping into the blockchain and are already working on revolutionary programs and protocols that draw in users enmasse. It is also cheap because big-ticket investors and traders whose input in the token may push its prices up have been waiting to see the direction that Polkadot token takes and gauging it is worth buying.

Now that Polkadot has proved its worth and asserted its position as the ultimate Ethereum killer, you can already see more activity around the token. Even with the falling prices, the daily trade volumes keep rising, which says that it is only a matter of time before the demand for DOT tokens outpaces their supply and kickstarts the climb away from the low price levels.

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.