Polkadot, the leading Layer-0 blockchain, saw a significant drop in user demand last month. Activity on its Relay Chain and parachains dropped sharply in June, reaching its lowest levels since the start of the year.
This, combined with the overall market downturn, has caused the value of the national DOT coin to fall by almost 15% over the past 30 days.
Polkadot Users Shun the Network
In June, Polkadot saw a significant drop in network activity on its Relay Chain and parachains.
The Relay Chain is the central chain of the Polkadot network, responsible for the coordination and security of the blockchain. Its parachains are separate blockchains that operate in parallel and are connected to the Relay Chain. They leverage the security and compatibility of the Relay Chain while operating independently.
During the 30-day period in question, there were 192,330 unique addresses active on the Polkadot relay chain, both senders and receivers.
This represents a 15% month-on-month (MoM) decline from 225,870 registered active addresses in May. Estimated on a year-to-date (YTD) basis, this represents a 37% drop.
Read more: What is Polkadot (DOT)?
New demand on the network has also fallen sharply. In June, the number of unique addresses appearing in transmission for the first time on the Polkadot Relay Chain was 34,370, down 22% from the previous month.
A similar downward trend was seen in Polkadot parachains, with the total number of active and new addresses falling by 21% and 25%, respectively, in June.
Interestingly, despite the drop in user numbers, Polkadot parachains recorded more coin transfers in June than in May.
Over the 30-day period, monthly parachain transfers totaled 4.3 million, up 10% from the 3.9 million transfers recorded in May.
DOT Price Forecast: Further Declines Expected
At the time of writing, DOT was trading at $5.87. Due to the decline in Polkadot network activity and the overall market downturn, the altcoin has fallen by 17% in the last 30 days.
With a sustained decline in demand for DOT, further price falls are possible. According to its relative strength index (RSI), selling activity outweighs accumulation among market participants. At press time, the indicator’s value is 42.32 and falling.
This indicator measures the oversold and overbought market conditions of an asset. At 42.32 RSI DOT signals that market participants have given preference to coin distribution.
If selling pressure continues to increase, the altcoin’s price could fall to $5.36.
Read More: Polkadot (DOT) Price Prediction 2024/2025/2030
However, if demand for DOT increases, its price could rise to $5.92.
