To talk about the bull market in 2021, only talking about DEFI and not talking about Polkadot is obviously incomplete. Polkadot, as a project that has attracted much attention in 2020, has attracted the attention of many people from the beginning, and remains a hot spot in the market until now.
I started to pay attention to Polkadot from 2019, early on it was difficult to understand because of the lack of information. Last year, Polkadot’s launch was a focus, and related media publicity has gradually increased. The most important thing is Polkadot ecology. The wealth effect caused by some of the projects, such as KSM and the like, of course, as a big fish we know that Polkadot’s parachain slot auction is still a focus of attention.
Many people see Polkadot's promotional materials and will always associate the rest of the web 3.0 , mainly because the Web 3.0 Foundation has invested heavily in the Polkadot project and they look forward to applying Polkadot to the future development of web 3.0. Based on Blockchain technologies such as Polkadot, a series of new types of Internet designed to replace the existing Internet have been constructed.
Of course, the vision is beautiful, and there may be certain difficulties in the realization of the actual project. Compared with the previous EOS blockchain 3.0, but i currently sees Polkadot more like the blockchain 3.0, and it will also integrate the Internet in the future. , There is a trend to do well in web 3.0.
Main reason: inflow of funds
In the current blockchain project investment field, DEFI uses liquidity mining to distribute tokens. The project party uses this method from the market when the project is launched. The previous ICO model was abandoned because of legal risks, and the exchange's first token model did not generate much craze because of the cost of listing on the exchange. But now there are many Polkadot ecological projects for institutional investors. Now a large number of Polkadot ecological projects have reached a very active level, and with cases of overfunding abounding.
This type of project of Polkadot currently has several similar characteristics:
1. The project party needs money to conduct the slot auction.
2. The valuation of the project is relatively US$100 million, and the market value is relatively low.
3. There are many types of projects, including DEFI, on-chain privacy, and DID, aggregator, oracle, and so on.
4. The project has obtained excess private placement of funds during the private placement stage, and some quotas even have to be grabbed.
Of course, if we combine a little bit, that is, the parachain auction is about to come, but the DOT currency price has not dropped much in the callback, then what can be determined is:
1. Polkadot's ecological building is under construction, which is an advantage for other public chains
In fact, compared to the public chain, ecology is its best moat. For example, Bitcoin also has a moat. This includes POW currencies such as Litecoin and Dogecoin, and their clients basically copy Bitcoin. For Ethereum, DEFI and DAPP are the moat. As long as someone uses these applications on the chain, then the price of Ethereum will have a certain demand in the market. There is also a negative example, EOS. Although there are DAPPs on the EOS chain now, the value of the tokens on the chain will not be very high, and after the gambling application is down, except for one of the few well-known DEFI projects now Besides, there is nothing worthy of attention.
Therefore, Polkadot is also a forward because of its ecological project. In the future, we will not say how good it can develop, but at least it is not easy to see the possibility of a sharp price pullback, unless the overall market is broken, or there is a major technical problem.
2. For Polkadot to succeed, it will inevitably need more funds to participate in it
There is no doubt that the success of Ethereum was precisely because the currency issuing function at the time attracted many project parties to issue coins and then hyped them in the market, which brought a lot of funds to Ethereum. It is precisely because of these funds that Ethereum survived. , There is a saying in the market: Pulling is the best publicity, it is this truth.
So if Polkadot has a future in the later stage, it will inevitably need to continue to pull the market to attract the attention of others in the currency circle. The wealth-making effect will naturally make people feel good about Polkadot, which will have certain benefits for the development of future projects.
3. Ecological projects pay attention to the overall situation
We see the ecology of Ethereum, and the Ethereum Foundation plays an important role in it. During the bear market, some people were only concerned about the Ethereum Foundation’s investment in its ecological projects. Now the bull market is coming, and these investments have been successful. , The price of project tokens has also doubled several times, and this strategy is now being used by Polkadot.
At present, from the perspective of market news, a large number of Polkadot ecological projects have received investment from the web 3.0 foundation. This is different from EOS, which was previously known as Blockchain 3.0. We all know that the EOS project parties took the money from crowdfunding to buy bitcoin and US treasury bonds in the first place, but they did not invest a lot in EOS ecological projects, which also showed that they may not be optimistic about EOS's ecology, so they would not choose to invest.
For Polkadot ecological projects, getting the investment from the web 3.0 foundation on the one hand binds the core interests of both parties together. The foundation must provide some support to the project, their own investment will be easy to drif. On the other hand, they are also optimistic about the project's contribution to the Polkadot ecology and even the web 3.0 ecology. Therefore, it is certain that Polkadot ecological projects are worthy of attention.
