DOT, the native currency of smart contract platform Polkadot, remains under pressure, posting sharp losses after hitting an all-time high of around $55 in 2021. The coin is trading at around $6, volatile but up around 45% from 2022 .lows, buoyed by the broader recovery in the crypto scene.
Will DOT Break Above Immediate Resistance Levels?
Despite DOT’s problems, one crypto trader, @Ashcryptoreal, is optimistic on the coin’s prospects, pointing to the eventual implementation of Polkadot 2.0, a crucial update to the cross-chain network. On November 27, the crypto trader goes to X and believes that Polkadot 2.0 will solve the current issues plaguing the smart contract platform.
Specifically, Polkadot 2.0 represents an overhaul set to introduce several improvements that, if executed as indicated, could push DOT above current resistance levels. With rising DOT demand, the coin, and by extension the platform, could rise and rise to its former glory as one of the leading blockchains with dense user activity.
Looking at the price action, DOT is moving within a wide horizontal range with highs around $3.5 and $7.5. Despite the recent spike, which saw the coin rise 45%, prices are trading within the early November bull bar.
Based on this, there should be a sharp expansion from spot levels above $5.6, with rising trading volumes where buyers can take the lead. However, the current formation still favors buyers.
What’s the problem with Polkadot 2.0?
Polkadot 2.0 revises certain features as they currently exist on the network. Most importantly, analysts note that proposed changes could expand the network’s capabilities and attract more developers.
After the updatePolkadot is migrating from the dynamic block space allocation system, allowing developers to purchase block space as needed, both in bulk and individually. This flexibility could make the network more attractive for different projects.
Moreover, so will Polkadot 2.0 to suggest elastic cores, allowing the network to adapt to different computing requirements depending on usage. This adaptability can make the network more efficient. Moreover, it adapts to the diverse needs of developers.
The concept of core time, which measures the demand for computing resources, will be a notable addition to Polkadot 2.0. As in EOS, resources are purchased at core time via auctions or on a pay-as-you-go basis, giving developers more control.
Analysts expect these changes to increase demand for DOT as the currency serves as a medium of exchange. All on-chain transactions are settled in DOT.
Feature image from Canva, chart from TradingView