Polkadot, a decentralized project by Web3 Foundation, has gained the attention of the cryptocurrency market in 2021 due to the significant rise in the value of its token DOT. The price of DOT has gained more than 100% in the last 7 days.
According to the data gathered by Coinmarketcap, the price of Polkadot (DOT) jumped from $7.80 on 11 January to as high as $18.90 on 17 January. As of writing, the price of Polkadot is consolidating near $17.50.
The recent price rally helped Polkadot to reach a market cap of $15 billion. The cryptocurrency is now more valuable than Bitcoin Cash, Cardano, Litecoin and XRP. Polkadot is the fourth-largest cryptocurrency in the world behind Tether.
The Polkadot network was founded by Gavin Wood, former Co-founder and CTO of Ethereum. It is an open-source protocol that facilitates the cross-chain transfer of any data or asset types, not just tokens.
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“Polkadot will enable a completely decentralized web where users are in control. The project is built to connect private and consortium chains, public and permissionless networks, oracles and future technologies that are yet to be created. The network facilitates an internet where independent blockchains can exchange information and transactions in a trustless way via the Polkadot relay chain,” the official website states.
In 2021, altcoins posted strong gains amid growing retail demand. In addition to Polkadot, other cryptocurrency assets including Cardano, Chainlink, and Stellar have recorded double-digit gains in recent days. Cardano is up more than 30% since the last week while Chainlink jumped nearly 50% to reach a record high of $22. Recently, the last few weeks have been tough for XRP and Litecoin. XRP has lost more than 50% of its value after the SEC’s action against Ripple, and Litecoin remained stagnant during the altcoins rally.
There is a significant rise in the number of companies using Polkadot’s ecosystem. One of the examples is the insurance startup, Tidal Finance (built on Polkadot blockchain) which raised nearly $2 million seed round funding in December 2020.