Key facts:
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On-chain metrics demonstrate a low level of activity within the Polygon network.
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MATIC’s market cap is at near-12-month lows
There are only two days left until the update occurs within the Polygon network, in which The native token of this Blockchain will mutate from MATIC to its new version POL. Although the Polygon ecosystem is just hours away from taking this step, the response from the market and the Polygon community seems to be one of lethargy and stagnation.
This asset conversion event reported According to CriptoNoticias, the update will occur automatically without users having to intervene and will take place on September 4, 2024. Despite the proximity of the event, the enthusiasm that this update would entail has not yet been reflected in the on-chain data or in the MATIC price.
What’s happening on the Polygon network?
Taking some on-chain metrics pulled by the analytics site Grow the piesuch as the number of daily active addresses and the number of daily transactions on the blockchain, can be observed low levels of activity from February 2024 to the present.
Activity within the Polygon network remains at low levels. Source: Grow the pie.
During that period, the number of active accounts hovered between 4,000 and 5,000. Only in June did there be an improvement, reaching between 7,000 and 9,000 active accounts.
On the other hand, the number of daily transactions recorded on the network, from the end of February to the present, remained at levels between 10,000 and 20,000 dollars per day.
Another not-so-encouraging measure of activity on Polygon is the decline in market capitalization. This data reveals the migration of users out of the network or to other platforms, since using Polygon presupposes holding MATIC to pay fees. At the time of writing, This metric is close to its lowest level in the last 12 months, at $3.9 million, indicating that users have been selling the asset.
Chart showing the evolution of Polygon’s market capitalization from September 2023 to the present. Source: Grow the pie.
Ultimately, In the last few hours, there have been no upward or downward breakout movements in the MATIC price.. At the time of writing, the price of the Cryptocurrency remains in the resistance zone near $0.40. This can be seen in the following image taken from TradingView.
Chart of the MATIC cryptocurrency expressed in weekly candles. Source: TradingView.
On August 26, 2024, MATIC began a price decline from around $0.54 until it reached and held at the aforementioned resistance. This is the fourth time it has reached these areas since 2021, and each time it has bounced upwards from here, although each time with less force.
There are, therefore, several indicators that suggest that the Polygon network is not as active as it once was. The price chart shows that the MATIC (soon POL) price could be drawing a long-term bottom thanks to which, with the favour of a hypothetical bull market, the network could be able to resume the path of activity and MATIC, the appreciation of speculative investors.
However, this is just one scenario, and it remains to be seen whether this rebranding of Polygon will have a positive impact on network usage after September 4.
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