Polkadot (DOT) Users Shun the Network as Activity and New Demand Plummet, Price Prediction

The past month has seen a significant drop in user demand for Polkadot, the leading Layer-0 blockchain. Activity on its Relay Chain and parachains plummeted in June

Polkadot (DOT) network activity has seen a significant decline in the past month. This, combined with the broader market downturn, has caused the value of DOT to drop by nearly 15%.

According to data from Footprint Analytics, 192,330 unique addresses were active on the Polkadot Relay Chain in June, either as senders or receivers. This marks a 15% month-over-month (MoM) decline from the 225,870 recorded in active addresses in May. Assessed on a year-to-date (YTD) basis, this represents a 37% fall.

New demand for the network also plummeted. In June, the number of unique addresses that appeared for the first time in a transfer on the Polkadot Relay Chain was 34,370, a 22% MoM decline.

A similar downtrend was observed across Polkadot’s parachains, with total active and new address counts falling by 21% and 25%, respectively, in June.

Interestingly, despite the fall in user count, Polkadot’s parachains recorded more coin transfers in June than they did in May. During the 30-day period, monthly transfers across the parachains amounted to 4.3 million, a 10% surge from the 3.9 million transfers registered in May.

This uptick in coin transfers may be attributed to the launch of several new parachains and the deployment of XCM (Cross-Chain Message Format), a technology that enables interoperability between parachains and external networks.

With Polkadot’s network activity declining and the market at large experiencing a downturn, the price of DOT has seen a significant drop in recent times. At the start of June, DOT was trading above $7. However, due to a sustained decline in demand for the token, it has now fallen to $5.87.

Despite the drop in activity and the lower value of DOT, the coin still ranks 11th on CoinGecko with a market capitalization of over $6.5 billion.

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