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Polygon experienced its first decline in 10 days, despite positive metrics in its non-fungible token (NFT) and decentralized finance (DeFi) ecosystems.
DEX Volume and NFT Sales Rise
Polygon (MATIC) dropped by 6.77% to a low of $0.53, down from last week’s high of $0.582. However, it remains 60% higher than its lowest point this month, as the countdown to MATIC’s transition to POL on Sept. 4 continues.
The recent pullback occurred after developers regained control of Polygon’s X account following a hacking incident.
Third-party data indicates strong performance in Polygon’s ecosystem. Weekly NFT sales surged by 111% to over $12.7 million. The number of buyers increased by 35% to 88,000, while sellers rose to 25,000.
Polygon processed 356,700 transactions, although the wash volume decreased by 12% to $9.2 million. It ranks as the fourth-largest player in the NFT market, following Ethereum, Solana, and Bitcoin.
DeFi Ecosystem and Competition
In the DeFi sector, Polygon saw a 7.32% increase in DEX volume, reaching $770 million. It ranked as the seventh-largest player, trailing Ethereum, Solana, and Tron. Prominent DEX networks in the Polygon ecosystem include Uniswap, Quickswap, Woofi, Dodo, and Retro.
The total value locked (TVL) in Polygon’s DeFi ecosystem climbed by over 10% in the past week to $951 million. However, the network faces significant competition from Arbitrum (ARB) and Base, which have amassed assets worth $2.82 billion and $1.6 billion, respectively. Arbitrum has also emerged as a highly active DEX network, handling over $3.7 billion in the last week.
Upcoming Transition to POL
The next significant development for Polygon will be the transition from MATIC to POL. This upgrade will introduce new capabilities, allowing it to provide services across any chain in the Polygon network, including AggLayer. POL will also serve as the native gas and staking token for Polygon’s proof-of-stake network, potentially introducing more volatility as the launch approaches.
Technically, Polygon has crossed the 50-day moving average and is currently at the 23.6% Fibonacci Retracement level. Previously, it failed to surpass this retracement point in July of this year. The token has now formed a bearish engulfing candlestick pattern, indicating a potential pullback, possibly to the 50 EMA level at $0.493.
For more updates on Polygon and other cryptocurrency news, explore more articles on Global Crypto News.
