Cryptocurrency

Polygon’s ever-expanding ecosystem supports MATIC’s rise to record highs

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The Layer 2 (L2) solution of the Ethereum network has become a hot topic of discussion and speculation, and its related tokens have supported the large-scale rebound in many agreements this year. The parabolic growth of decentralized finance (DeFi) and non-fungible tokens (NFT) has also led to a surge in the cost of simple transfers, which has prompted developers and investors to migrate to platforms that support L2.

The token price of an L2 solution rose to a new high earlier this year, and now it looks like it is expected to break through again, Polygon (Matic), a proof-of-stake blockchain protocol that can aggregate scalable solutions on Ethereum to support a multi-chain ecosystem.

Data from Cointelegraph Markets Pro with Transaction view It shows that MATIC hit a low of $1.01 on September 21. In the past few months, the price has been in a steady upward trend, making the altcoin break through the $2 mark on December 1.

MATIC/USDT 1-day chart. Source: TradingView

Polygon’s ecosystem is expanding, which can be seen from the release of agreements, cross-chain migration, the release of Polygon-focused exchange-traded products (ETP), and the steady increase in user activity.

Ecosystem expansion

One of the biggest drivers of MATIC price and on-chain activity is the addition of new protocols for the Polygon network project launch and cross-chain migration.

Recently, IDEX decentralized exchange announced that it will launch v3 of its exchange on the Polygon network, making it the first mixed liquid DEX on Polygon.

The Polygon network has witnessed the launch of NFT projects (such as the OpenBiSea NFT market) and game/DeFi platforms (such as Rainmaker Games, Harvest Finance, and Jarvis Network).

Currently, the Uniswap community is voting on whether to add Polygon support to Uniswap v3, and the process has entered the second stage after the majority vote was obtained in the first stage of voting on November 25.

Increasing institutional support

Another reason for Polygon’s bullish price is increased interest from institutional investors. In recent months, several exchange-traded products (ETP) of Polygon have been listed, including Osprey Polygon Trust in September and 21Shares Polygon ETP in November.

Polygon is also included in the list of assets that Grayscale Investments is exploring as a potential trust candidate.

The network also benefited from the US$20 million investment fund launched by Wintermute, a digital asset market maker focused on helping guide the development of decentralized applications on Polygon.

At present, the Polygon network is receiving more and more attention, as it is preparing to hold the ZK Summit on December 9th, where developers will discuss “the current situation and future of zk-STARKs and the application of zero-knowledge proofs.”

related: IDEX will launch a hybrid liquidity decentralized exchange on Polygon

Increase in active users and wallets

The third reason for the bullish price trend seen in MATIC is the steady increase in users on the network because Prove By increasing the address of the wallet holding the balance.

Polygon address with balance and MATIC price. Source: Intotheblock

As shown in the figure above, the number of Polygon wallets with balances has steadily increased throughout 2021, and is currently at the highest level in history of 282,760.

Evidence of increased activity can also be Established Among the total revenue data generated by network expenses, this data has been steadily increasing in the second half of 2021.

Polygon price and total revenue.Source: Token Terminal

As new protocols continue to be listed on the Polygon network, these statistics may rise if new users continue to use the platform to escape the high fees on the Ethereum network.

VORTECS™ data comes from Cointelegraph Markets Pro Before the recent price increase, a bullish outlook for MATIC began to be discovered on October 15th.

Cointelegraph’s unique VORTECS™ score is an algorithmic comparison of historical and current market conditions. These data points include a combination of market sentiment, trading volume, recent price changes and Twitter activity.

VORTECS™ score (green) and MATIC price. source: Cointelegraph Markets Pro

As shown in the graph above, MATIC’s VORTECS™ score soared to the green zone on October 15 and reached a high of 94 in the 48 hours or so before the price began to rise by 57% in the next six weeks.

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