The Polkadot price has rebounded this month, reaching a high of $4.65, its highest level since May 23. The DOT token has jumped by about 50% from its lowest point this month, and it is likely to maintain the bull run, potentially reaching $7.3 in the near term.
Why the Polkadot Price is About to Surge
DOT price may continue rising this month as its ecosystem growth accelerates. Data shows that Hydration’s total value locked has gone parabolic and hit its all-time high this week. It has over $253 million in assets, a sharp increase from $53 million in June.
FIFA Rivals, a game on its platform, has become popular and is ranking high on IOS and Android devices. Its growth is likely to accelerate in the coming months, as it was recently launched.
Polkadot’s ecosystem growth is expected to continue after developers abandoned parachain auctions, which were known for being highly expensive and time-consuming.
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DOT price will also jump if the community members vote to eliminate staking rewards, as Gavin Wood has suggested. In theory, eliminating staking reward is negative and is akin to a company that stops paying its dividends.
However, in this case, ending these rewards will be positive, as it will eliminate the issuance of almost 500 million new tokens to the market. In most cases, recipients of these tokens sell them, creating substantial selling pressure and increasing the circulating supply.
Wood also wants to change the validation process by introducing the proof-of-personhood, where anyone, regardless of their holdings, will be able to validate the network. These changes will likely boost the Polkadot price over time.
Furthermore, the developers are working on the Join-Accumulate Machine (JAM), an upgrade that will replace the current Relay Chain with a more modular and scalable architecture. It will evolve from a blockchain for hosting parachains into a general-purpose world computer for running decentralized applications (dApps).
DOT Price Technical Analysis
Polkadot price chart | Source: TradingView
The Polkadot price has rallied over the past few weeks, moving from a low of $2.985 in June to $4.50 today. It has jumped above the 50-day moving average, a sign that the trend is strengthening.
The Money Flow Index (MFI) has jumped to 88, its highest level in months. Similarly, the MACD indicator has also moved above the zero line and is pointing upwards.
Therefore, the token will likely continue rising as bulls target the double-top’s neckline at $5.80, which also coincides with the 23.6% Fibonacci Retracement level. A move above that resistance will point to more gains, potentially to the 50% retracement level at $7.315, up by 63% from the current level.
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