Stay away from these 2 cryptocurrencies this week amid prevailing negative sentiment
Two cryptocurrencies have emerged as the center of attention in the past 24 hours, generating a significant amount of negative sentiment. Investors in the cryptocurrency market are being advised to steer clear of Polkadot (DOT) and Bittensor (TAO) this week due to the prevailing fear, uncertainty, and doubt (FUD).
These two cryptocurrencies have gained attention as they rank among the top five trending coins on Santiment’s social trends. TAO, in particular, has experienced a surge in social volume, with an overwhelming negative sentiment.
The overall cryptocurrency market has suffered losses following a crash in Bitcoin (BTC) that led to a decline in an important support zone. This could potentially have an impact on the entire ecosystem, especially on these two projects which have recently faced controversy and negative news.
Bittensor (TAO) has recently encountered a major security breach, with attackers draining $8 million worth of TAO tokens from user wallets on July 3. In response, the Bittensor team took the decision to halt all transactions on the network in order to contain the exploit. They have assured users that they are taking necessary measures to prevent any further mishaps and have put the chain in “safe mode” for investigation purposes.
However, this unilateral decision and the team’s control over the blockchain have sparked criticism within the community, raising concerns about centralization issues. The investigation into the attack is still ongoing, with security researcher ZachXBT suspecting a private key leakage as the cause.
This security breach has also raised concerns about the vulnerability of the project, leading investors to approach TAO with caution in the coming weeks as doubt lingers and the hackers may dispose of the tokens, potentially impacting the price. Currently, 48.78% of all mentions of Bittensor on social media carry a negative sentiment.
On the other hand, Polkadot (DOT) is facing criticism for its recent spending habits, which have raised concerns about its financial stability. The company’s treasury report indicates that it has spent $87 million in the first half of 2024.
A significant portion of this spending, over 42%, was allocated to outreach activities, including influencer partnerships and sponsorships. Polkadot’s treasury revenue has significantly decreased, dropping from 414,291 DOT to 171,696 DOT.
While head ambassador Tommi Enenkel suggests that the company has about two years of runway left, CEO Fabian Gompf disputes these claims, stating that the treasury will never run out of funds. Gompf acknowledges that there has been excessive spending on activities with low return on investment and encourages the community to vote for change.
Critics have pointed out a $53,000 invoice for a six-month animated logo on CoinGecko as an example of wasteful spending. Venture capitalist Adam Cochran describes Polkadot’s outreach spending as a reckless use of funds. These financial decisions by the company have sparked a debate about its future sustainability and resource allocation.
Disclaimer: The content on this site should not be considered as investment advice. Investing in cryptocurrencies is speculative, and there is a risk of capital loss.