Polkadot is a creation of Dr Gavin Wood, one of the original co-founders of Ethereum (alongside Charles Hoskinson (Cardano) and Vitalik Buterin).

He also created the Solidity programming language, a basis for Ethereum and its gigantic ecosystem.

Dr Wood and Parity’s Peter Czaban founded the Web3 Foundation in 2017. It is a non-profit entity established to support the research and development of Polkadot as well as to oversee its fundraising efforts.

The Web3 Foundation chose Parity Technologies to develop Polkadot. Similarly, Dr Wood founded Parity Technologies with Jutta Steiner to maintain the development framework for Polkadot.

The crypto market usually rallies around cult figures, which has resulted in catastrophic implosions and loss of wealth.

Conversely, a respected team with past track records means the project has a chance of success.

Market Opportunity

The Polkadot (DOT) ecosystem has been relatively behind other blockchain ecosystems since its launch in 2017.

Several developers have recently built and launched projects on the DOT ecosystem through its crowd loan and para chain mechanism.

These projects rival those built on Ethereum (ETH) and aim to overcome some of Ethereum’s shortcomings. Hence, the projects deploying on DOT include various decentralised finance (DeFi) protocols, NFT platforms, data oracles and more.

The ecosystem has recently experienced an uptick in project deployment and has experienced sustained developer activity, according to research from messari.io (See images below).

According to research by Messari, after Bitcoin (BTC) and ETH, DOT is the digital asset most held by investment funds.

This metric demonstrates that investment funds have immense faith in the ability of the DOT ecosystem and its projects to experience significant growth and attain their visions.

Additionally, the number of DOT holders has steadily increased, most likely due to the rewards from bonding DOT tokens to parachain auctions.

The DOT ecosystem could be a serious contender to the ETH ecosystem.

DOT’s mainnet officially launched in 2021; hence it is still very young and will need some time to realise its potential fully.

As such, if DOT takes more market share from ETH and the total cryptocurrency market capitalisation, which is very likely, its market capitalisation may double to what it was at its 2021 all-time high (ATH).

A portion of ETH’s market share will mainly come from DOT’s EVM compatibility.

This compatibility will enable developers to quickly deploy on Polkadot and its parachains for a fraction of the cost and effort associated with an ETH deployment.

Additionally, developers can copy and paste projects designed for ETH’s ecosystem into DOT’s ecosystem, increasing cross-chain compatibility and easing liquidity fragmentation.

For instance, Moonbeam and Moonriver are Polkadot ecosystem projects aiming to combine the established and familiar Ethereum tooling and Polkadot’s scalable and interoperable architecture. The projects mirror Ethereum’s RPCs, accounts, keys, subscriptions, logs and much more.

Price Prediction

The table below shows the total crypto market’s past and potential future capitalisation.

The blue cell corresponds to DOT’s market cap at the peak of the most recent bull run, its market share of the total crypto market, and the total crypto market cap — US$55 billion, 2%, and US$ 2.79 trillion (US$ 2793 billion), respectively.

Assuming a similar amount of DOT remains staked in the future, we can estimate DOT’s market cap for various market dominance percentages relative to the overall total crypto market cap.

The total crypto market cap experiences exponential growth every bull cycle as adoption, awareness and speculation grows. A US$6 to US$8 trillion total market cap for the next bull cycle is likely given that the total market cap grew from about US$780 billion in 2018 to about US$3 trillion in 2021 (see image) — an almost 4x growth.

The next wave of adoption, growth and speculation can likely propel the asset class to a US$5 to US$6 trillion market cap. This number is highly conservative given the logarithmic increase in adoption, awareness, institutional participation and the number of developing blockchain projects.

The DOT ecosystem is relatively young. So, there may not be sufficient time before the next BTC halving and speculatory bull run in 2024 to mature enough to take further market share.

A US$5 trillion total crypto market cap and a DOT dominance of 2% will place DOT’s market cap at around $100 billion (see table below).

At this level, DOT’s fully diluted market cap will place the token’s price at around US$100. But assuming a token inflation rate of 10%, this number goes down to about US$76.

But if only 50% of the total token supply is liquid, the USD value of each token could double to about US$150.

Polkadot is a creation of Dr Gavin Wood, one of the original co-founders of Ethereum (alongside Charles Hoskinson (Cardano) and Vitalik Buterin).

He also created the Solidity programming language, a basis for Ethereum and its gigantic ecosystem.

Dr Wood and Parity’s Peter Czaban founded the Web3 Foundation in 2017. It is a non-profit entity established to support the research and development of Polkadot as well as to oversee its fundraising efforts.

The Web3 Foundation chose Parity Technologies to develop Polkadot. Similarly, Dr Wood founded Parity Technologies with Jutta Steiner to maintain the development framework for Polkadot.

The crypto market usually rallies around cult figures, which has resulted in catastrophic implosions and loss of wealth.

Conversely, a respected team with past track records means the project has a chance of success.

Market Opportunity

The Polkadot (DOT) ecosystem has been relatively behind other blockchain ecosystems since its launch in 2017.

Several developers have recently built and launched projects on the DOT ecosystem through its crowd loan and para chain mechanism.

These projects rival those built on Ethereum (ETH) and aim to overcome some of Ethereum’s shortcomings. Hence, the projects deploying on DOT include various decentralised finance (DeFi) protocols, NFT platforms, data oracles and more.

The ecosystem has recently experienced an uptick in project deployment and has experienced sustained developer activity, according to research from messari.io (See images below).

According to research by Messari, after Bitcoin (BTC) and ETH, DOT is the digital asset most held by investment funds.

This metric demonstrates that investment funds have immense faith in the ability of the DOT ecosystem and its projects to experience significant growth and attain their visions.

Additionally, the number of DOT holders has steadily increased, most likely due to the rewards from bonding DOT tokens to parachain auctions.

The DOT ecosystem could be a serious contender to the ETH ecosystem.

DOT’s mainnet officially launched in 2021; hence it is still very young and will need some time to realise its potential fully.

As such, if DOT takes more market share from ETH and the total cryptocurrency market capitalisation, which is very likely, its market capitalisation may double to what it was at its 2021 all-time high (ATH).

A portion of ETH’s market share will mainly come from DOT’s EVM compatibility.

This compatibility will enable developers to quickly deploy on Polkadot and its parachains for a fraction of the cost and effort associated with an ETH deployment.

Additionally, developers can copy and paste projects designed for ETH’s ecosystem into DOT’s ecosystem, increasing cross-chain compatibility and easing liquidity fragmentation.

For instance, Moonbeam and Moonriver are Polkadot ecosystem projects aiming to combine the established and familiar Ethereum tooling and Polkadot’s scalable and interoperable architecture. The projects mirror Ethereum’s RPCs, accounts, keys, subscriptions, logs and much more.

Price Prediction

The table below shows the total crypto market’s past and potential future capitalisation.

The blue cell corresponds to DOT’s market cap at the peak of the most recent bull run, its market share of the total crypto market, and the total crypto market cap — US$55 billion, 2%, and US$ 2.79 trillion (US$ 2793 billion), respectively.

Assuming a similar amount of DOT remains staked in the future, we can estimate DOT’s market cap for various market dominance percentages relative to the overall total crypto market cap.

The total crypto market cap experiences exponential growth every bull cycle as adoption, awareness and speculation grows. A US$6 to US$8 trillion total market cap for the next bull cycle is likely given that the total market cap grew from about US$780 billion in 2018 to about US$3 trillion in 2021 (see image) — an almost 4x growth.

The next wave of adoption, growth and speculation can likely propel the asset class to a US$5 to US$6 trillion market cap. This number is highly conservative given the logarithmic increase in adoption, awareness, institutional participation and the number of developing blockchain projects.

The DOT ecosystem is relatively young. So, there may not be sufficient time before the next BTC halving and speculatory bull run in 2024 to mature enough to take further market share.

A US$5 trillion total crypto market cap and a DOT dominance of 2% will place DOT’s market cap at around $100 billion (see table below).

At this level, DOT’s fully diluted market cap will place the token’s price at around US$100. But assuming a token inflation rate of 10%, this number goes down to about US$76.

But if only 50% of the total token supply is liquid, the USD value of each token could double to about US$150.