The third quarter was not a comfortable ride for the broader market. And yet certain altcoins have conquered their niche and emerged as the top winners. Although Bitcoin and Ethereum didn’t see any major price increases throughout the third quarter, altcoins like Solana and Cardano rallied separately after the larger market thought they had “decoupled”.
Polkadot’s rallies have been viewed by many as independent as the alt rose 150% in August and September due to a wave of high social excitement. With these altcoins making big gains towards the end of the third quarter, institutional interest also peaked.
Institutional favorites
It’s true that some things don’t change, as does venture investors’ love for smart contract platforms. In the second quarter, too, there was generally a high level of institutional interest in smart contract platforms.
In the third quarter, Polkadot became the most widely held asset by investors in the third quarter.
Source: Messari
Of the most heavily invested assets, Solana has the highest market capitalization in circulation among any other altcoins held by investors. Notably, Solana also appeared to offer a high ROI against USD of 9837.50%, with the same performing solidly throughout the year.
Polkadot, on the other hand, has bounced back from the anticipation of its Parachain slot auctions. Also at the time of writing, DOT was seeing high social volume despite the 20% drop in price over the past week.
Source: Sanbase
Additionally, news like the DFG Group, which controls $ 1 billion in AUM, also contributed to their pledge of 300,000 DOT tokens (valued at $ 12.65 million) in support of Astar Network’s Parachain offering Has.
Undoubtedly, the developments in Solana and Polkadot last quarter attracted a great deal of institutional interest. This was also key to their network growth rate.
Ready to Unpair?
After Bitcoin fell by almost 9% on November 16, neither DOT nor SOL could do as well as expected. One reason for this could be the relatively weak trade euphoria.
Notably, despite the recent ATHs, DOT’s trading volume was not in line with its early September levels.
Solana’s case was not much different either. While the fifth-placed coin recorded the highest trading volumes in early September, the volumes have been average since then.
Source: trade view
Although both cryptos have maintained low volatility in relatively bearish market conditions, their price has not been entirely untouched by the market. In fact, Solana’s price was down 12% over the past week while DOT was down 17% over the same period.
Historically, Solana has rallied against market sentiment, while DOT’s rallies have been more market-driven. While both altcoins markets are maturing with institutional inflows, they still haven’t fully decoupled.
Even if they become the new institutional favorites, it will still be some time before the two can decouple themselves from the top assets.
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