Some Asian Traders Are Using Polkadot to Predict Bitcoin’s Future

As prices for bitcoin and other cryptocurrencies continue to surge this year, many traders are looking for any indicator for when – or if – the bull market will come to an end. Some are convinced they have the answer: They are examining polkadot (DOT), the native token of the Polkadot blockchain, as a potential canary in the coal mine for cryptocurrency.

As of press time, polkadot’s price was at $12.49, up 12.40% in the past 24 hours, according to Messari. It reached its all-time high of $13.22 during early trading hours in the U.S., just six days after bitcoin’s price reached a new all-time high.

The market capitalization of Polkadot has surpassed XRP (-5.12%) and litecoin (LTC, -4.68%) and is now the fourth-biggest cryptocurrency by market cap, according to Messari’s asset tracker.

Sources who spoke to CoinDesk as well as social media users, especially on Chinese-language platforms, see parallels between the 2017 bull market prices of bitcoin (BTC, -6.42%) and EOS, the native cryptocurrency for the EOS.IO blockchain platform. They said Polkadot, a project started by Ethereum co-founder Gavin Wood and considered to be one of the so-called “Ethereum killers,” shares similar features and goals of the EOS.IO project, which was also born with the ambition of replacing Ethereum.

After bitcoin’s price reached its peak in 2017’s bull run, many investors and traders took their profits and moved them into tokens like EOS, a period of time now called “alt season.” Prices for EOS reached an all-time high at the end of April 2018, after which “crypto winter” was said to have started.

Claims that EOS and bitcoin prices were related in 2017 and 2018 are contentious.

“Correlation, not causation,” said Terry Wilkinson, chief executive officer at the Tokyo-headquartered investment firm Anchor Value. EOS “was the latest greatest pie-in-the-sky protocol at that time and as such garnered a lot of hype during that cycle. The bull run did not end because EOS stopped pumping. It was kind of the poster child for that run.”

Some Asian Traders Are Using Polkadot to Predict Bitcoin’s Future