Polkadot parachain’s growth potential is attracting a lot of attention from smart money investors. Reports indicate a surge in support from VC funds, hedge funds, and mercenary providers of liquidity.
Polkadot’s cryptocurrency, DOT, is gaining increased acceptance among investors. DOT, is now the most widely held crypto asset.
While there is general all-around euphoria and optimism around DeFi, NFTs, Metaverse, and Web3, DOT seems to have the potential to overturn the prospects of all the three much-hyped businesses.
Polkadot’s Rise
DOT’s appeal, principally, lies in the fact that it enables blockchain interoperability. Gavin Wood, the co-founder of Ethereum created DOT. If DeFi is to fulfil its potential, interoperability between the hundreds of existing blockchains is essential. Polkadot facilities asset transfer across block-chains. The asset could be data or tokens or NFTs. This is enabled with parachains. Parachains are networks that run parallel to the polkadot framework.
Earlier this month, five polkadot parachains went live. This concluded with an auction where individuals collected vast amounts of DOT via crowd loans. The five parachains that went live were – Acala, Clover, Moonbeam, Astar, and Parallel Finance. These parachains cover the entire range from DeFi to investments/loans.
Polkadot benefited also from the news that T-system MMS which is a subsidiary of Deutsche Telekom supports its blockchain. It is doing this by being a validator by enabling data exchange between parachains.
MMS’s optimism on Polkadot drove it to buy a large quantity of DOT tokens. The interest and optimism from MMS rises from the belief in its potential to become a vital driver of the DeFi ecosystem. In the long term, Polkadot aims to set up up to 100 parachains. The holding of DOT will empower investors to have a decisive effect on determining which DeFi initiatives can become parachains.
