Polkadot joins Cosmos’ Interchain: Is this a game changer?
- Cosmos’s interchain embraces the Polkadot network.
- ATOM bears dominate as the price embarked on a post-rally cooldown.
Thursday, 29 June, was an important day for the Interchain community. Cosmos announced that Polkadot was the latest addition to Interchain. Let’s explore why this integration is a huge step in the right direction for DeFi.
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First, let’s recap some of the jargon. Interchain is the internet of blockchains. Meanwhile, Polkadot happens to be a layer zero blockchain that acts as the supporting structure for layer 1s.
Now that Polkadot is connected to Interchain, it will be easier for Interchain projects to access those layer 1 networks. Meanwhile, the Polkadot community will now access liquidity from other projects.
Polkadot’s architecture makes it ideal for enterprise/private blockchain development. The main significance of the Polkadot integration into Interchain is the growth opportunities that it stands to offer once enterprise blockchain goes mainstream.
In other words, DeFi is now more prepared for enterprise adoption which is an important step toward mass adoption.
Assessing the possible impact on ATOM’s performance
An added benefit of the development is that it may positively impact ATOM’s price action. First, more utility for the cryptocurrency through the Polkadot ecosystem may fuel more demand for ATOM. The development itself might be enough to encourage more confidence among investors. Interestingly, Cosmos ATOM was LunarCrush’s coin of the day on 29 June.
The aforementioned developments have not curtailed ATOM’s downside so far. The cryptocurrency embarked on a bearish performance this week after previously delivering a healthy mid-June rally. ATOM traded at $1.98 at press time after an 8% dip from its weekly high.
ATOM’s Money Flow Index (MFI) already indicated that the cryptocurrency was experiencing outflows. Meanwhile, the Relative Strength Index (RSI) was a good indicator for a pivot point since the price turned bearish after hitting the RSI mid-point (50% level).
ATOM’s price action in the last few days wasn’t surprising considering the low investor sentiment favoring the upside. The weighted sentiment metrics showed no directional shift. This confirmed that that the investor sentiments remained unchanged.
How many are 1,10,100 ATOMs worth today
ATOM’s on-chain volumes also remained within the normal range for the month. A sign indicating that demand remains unchanged.
Since speculative demand has not gripped ATOM (at least not yet), the bulls might have to wait a while longer. However, that demand wave might still be in the pipeline especially as the market enters a new month.