- According to the WEB3 Foundation Polkadot could be spared from a regulatory apocalypse.
- DOT showed a lower relative strength because bullish momentum did not yield much upside.
Given the number of scams and instances where investors have lost their money, crypto regulation could shift quickly. Polkadot [DOT] It has issued a statement to DOT investors to address the threat posed by such actions.
Are you seeing a brighter side to your holdings? The DOT profit calculator is available.
According to a WEB3 Foundation blog post, DOT doesn’t fall under the securities category. It is instead considered software. Polkadot works with the SEC in pursuit for sensible regulation. This is important, particularly considering the fact that many crypto-related problems in 2022 could be avoided with proper regulation.
Polkadot’s native symbol DOT has become a non security. @Polkadot It is, and has been, coordinating program software. Web3 Foundation’s CLO @d_schoenberger, @daltonan, & @josh_blockchain This is the beginning of the story. @SamPeurifoy podcast: https://t.co/8vigPKS0Pv
— Web3 Foundation (@Web3foundation) January 5, 2023
Will DOT be safe when the regulatory apocalypse comes? Regulation is still uncertain in every way. The government still has to decide what regulations will be effective without causing more harm than good. Draconian regulations can be harmful to crypto segments in general, which could lead to a negative impact on DOT.
The effect of DOT on price action
A stringent regulatory environment could negatively impact investor sentiment and lead to another crypto market crash. Favorable regulations, on the other hand may encourage more people to invest in crypto. DOT could follow one of these routes once the regulatory framework has been revealed.
In the last 12 month, DOT has suffered a substantial drop in its value. It just achieved a bullish performance of up to 8% since 2023’s start. But this upside might be limited, as it is now showing signs of sell pressure at the RSI’s 50% level.
Source: TradingView
DOT’s MFI registered a large uptick in the last few days, but it underscored weak bullish momentum compared to the resulting price rally. The MFI has historically delivered stronger upsides; this latest rally shows that there is still low demand. In addition, DOT’s market cap dropped by as much as $150 million from 4 January’s highs.
Source: Santiment
A 57.71x on the cards if DOT hits Bitcoin’s market cap?
The market cap drop indicates that selling pressure has returned to the market. This could indicate that there might be more downside. DOT’s volatility indicator suggested that the cryptocurrency may experience less volatility in the next few days.
Source: Santiment
The bulls have some hope now that the development activity indicator is showing signs for increased activity. Polkadot’s long-term expectations may also improve, as the network continues to achieve more development milestones.
However, 2023 could be full of surprises. It wouldn’t be surprising that regulatory measures would be included in those surprises.