according to the website - By crypto.news
The price of Polygon continued its steady downtrend this week, despite a sharp increase in network activity following the Madhugiri hard fork.
The Polygon (POL) token fell to a new low after the transition from MATIC to POL last year. It was trading at $0.1200, down by double-digit percentages compared to the September high of $0.2970.
The ongoing decline in the price of Polygon continues despite the network having some of the best fundamental indicators. For example, the number of transactions sharply increased after developers activated the Madhugiri hard fork, which introduced new features.
It increased transaction speed by 33%, introduced consensus blocks within 1 second, and supported the recently launched Ethereum Fusaka update.
Data shows that Polygon processed over 8.1 million transactions in one day after this update. Additional data from Nansen shows that the number of transactions on the network increased by 93% in the last 30 days, exceeding 158 million. This growth makes it the second fastest-growing crypto network after Monad.
Other data shows that the number of active addresses on Polygon increased by 54% in the last 30 days, reaching 13 million. As a result, the total amount of collected fees increased by 27% to $778,000. This is important as Polygon continuously spends its fees, helping to offset the issuance of new POL.
Polymarket played an important role in the development of the Polygon ecosystem. Data shows that in November, the transaction volume on the network was $4.3 billion, and this figure will continue to grow now that the network has expanded in the USA. Polymarket operates on the Polygon network.
The ongoing price crash of Polygon has raised concerns that the network is greatly undervalued. One popular analyst compared its market capitalization with that of Sui (SUI).
Polygon has a DeFi transaction volume of over $1.19 billion compared to $931 million for Sui. Also, the supply volume of stablecoins exceeds $2.825 billion compared to $0.5 million for Sui. Polygon makes more money, has fewer unlocks, and is 5 times smaller than Sui.
SUI lags behind Polygon in almost all metrics, has huge monthly unlocks and inflation – and yet has 5 times larger market capitalization and 15 times larger free decentralized value.
What is happening with these estimates?
Let's figure it out:
Network revenue in November: $928,000 vs. $724,000.
Total transaction volume: $1.19 billion vs. $931 million.
The daily chart shows that the price of POL has been steadily falling over the past few months. It dropped from a high of $0.2970 in September to $0.12 today. As a result, the price fell below the key support level of $0.1520, and it has failed to break through this level several times.
The price of Polygon remains below all moving averages, while the upper oscillators continue to decline. On the other hand, the token has formed a descending wedge, the two lines of which are about to converge.
The wedge pattern indicates that the price of POL may soon bounce back. Such a bounce could lead to a rise to the key resistance level of $0.1520, which is almost 30% above the current level.
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