A popular crypto analyst evaluated Ethereum (ETH) competitors to decide which one is better.
Guy, the host of the channel named Coin Bureau, which produces content on crypto money, shared his current expectations about the interoperability protocol Polkadot (DOT) and the blockchain ecosystem Cosmos (ATOM) with 2.03 million YouTube subscribers.
Three months ago, the analyst said that Polkadot (DOT) has the potential to become one of the top crypto assets of the year. In making this prediction, the analyst drew attention to the huge amount of DOTs locked in parachain slot auctions. Guy now thinks like this:
“The demand factor for DOT comes from use cases in Polkadot’s parachains, particularly Acala, which recently announced a large incentive fund for its DeFi platform leveraging DOT.
A useful side-effect of Polkadot’s parachain slot auctions is that almost 15% of DOT’s circulating supply remains locked for two years. When you add this to the approximately 55% staked supply of DOT, this means that only 30% of the DOT’s supply is available for trading. This should mean more price volatility for the DOT when demand returns. However, DOT’s massive market cap means it will have a hard time getting above 3x in the short to medium term, especially with all the resistance around $30.
The Coin Bureau host said he predicts good growth, capitalizing on a video from February and preventing the crypto market from crashing.
“Many projects in the Cosmos ecosystem are not widely supported by centralized exchanges, and even listing on centralized exchanges is resisted. This only increases the demand for ATOM as the bridge currency for these new chains. Another advantage ATOM has is its mid-range market cap. This means that it takes less money to increase the price of ATOM as a percentage. To put things in perspective, if ATOM had seen a trade at the same level as the DOT, it would have yielded 3x more than its current price.
Assuming retail interest yields, I think this is a realistic short-to-mid-term prospect for ATOM. If that actually happens, and given the growth rate of the Cosmos ecosystem, I think a 5x move is possible. I will emphasize; All this is an assumption that the crypto market will continue to rally, which is by no means guaranteed.”
As for which altcoin is better, Guy says it’s a tough decision because in various ways every project is very similar.
“It’s interesting that these two crypto projects are so similar. The only real difference is the purposes their blockchains serve, and it looks like they’re about to become similar on that side as well. This is because Cosmos will launch cross-chain security later this year, which will allow smaller Cosmos cryptocurrencies to use blockchain for added security, similar to what parachains did at Polkadot.”
The crypto analyst’s final decision is in favor of Polkadot due to its potential to appeal to long-term institutions.
“Unfortunately, ATOM’s tokenomics doesn’t translate into a great economy. This is where DOT reigns, because while DOT isn’t used to pay fees on all Polkadot’s parachains, it has more than enough institutional interest to make up for it.
As for ATOM, the primary demand factor will mostly become ephemeral as centralized exchanges continue to add popular Cosmos projects. The use of ATOM as a bridge currency will decline, especially as it fails to transform itself into the interoperability hub it hopes to become.”
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Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, KoinFinans and the author of this content cannot be held responsible for personal investment decisions.