Analyzing the market’s lukewarm reaction to 21Shares’ Polkadot ETF filing

• 21Shares made an S-1 filing with the U.S SEC for a Polkadot ETF
• Crypto community shared their mixed reactions when news of the application broke out

It looks like the altcoin ETF craze isn’t slowing down in 2025. As the market awaits the SEC’s decision on Solana, Litecoin, XRP, and Dogecoin applications, Polkadot has joined the list now. 

On 31 January, digital asset manager 21Shares filed an S-1 form (registration statement) with the regulator for its proposed Polkadot ETF. This marked the first application for the altcoin in the United States. 

Source: SEC

Mixed reactions to Polkadot ETF

Oddly though, the submission received more scolding than praise from the crypto community. In fact, some users jokingly stated that it was “worse than XRP ETF.”

Reacting to the overwhelmingly negative response to the application by a section of the X crypto community, Bloomberg ETF analyst James Seyffart stated, 

“This is up there with the most hate I’ve ever seen an ETF filing get on this website. People really don’t like Polkadot… The market will decide where value lies and if there’s value in launching such a product. If no one puts money into a Polkadot ETF — it will close.”

On the on-chain side, DOT saw a blip in social volume and a spike in positive sentiment after the filing. However, at the time of writing on 01 February, the sentiment had soured. This could be linked to the negative community response or the sharp retracement of Bitcoin over the weekend. 

Source: Santiment

That being said, the filing was marked by massive leveraged trading and not strong spot market demand that could drive a sustainable rally on the charts. 

This was illustrated by the jump in OI (Open Interest), alongside the corresponding flat CVD Spot (muted spot market demand). 

Source: Coinalyze

If week spot market demand extends itself, DOT’s latest bounce could be at risk. On the 3-day price chart, DOT’s price has chalked a channel since early 2024. Over the same period, the key levels have been $4 and $11. 

However, the latest pullback appeared to have stabilized above $5.5, but was below key moving averages. If the broader market sentiment worsens over the next few days, DOT could sink to $4. 

Source: DOT/USDT, TradingView

On the contrary, a reclaim of $7.5 could bolster the odds of further recovery towards the peak around the $11-$12 price zone.