Polygon retreated for the first time in 10 days, even after seeing encouraging metrics on its non-fungible token and decentralized finance ecosystem.
Polygon (MATIC) fell to $0.53, down from last week’s high of $0.582, while remaining 60% above its lowest point this month. The decline comes as MATIC prepares to transition to POL on Sept. 4.
Polygon’s pullback occurred after the developers regained control of its X account following a recent hacking incident.
Third-party data shows that Polygon’s ecosystem is performing well. According to CryptoSlam, weekly NFT sales increased by 111% to over $12.7 million. The number of buyers rose by 35% to 88,000, with sellers increasing to 25,000.
Polygon handled 356,700 transactions, while the wash volume decreased by 12% to $9.2 million. It ranks as the fourth-biggest player in the NFT market after Ethereum (ETH), Solana (SOL), and Bitcoin (BTC).
Polygon also excelled in the DEX industry, with its volume growing by 7.32% to $770 million. It ranks as the seventh-biggest player, following networks like Ethereum, Solana, and Tron. Notable DEX networks in Polygon’s ecosystem include Uniswap, Quickswap, Woofi, Dodo, and Retro.
Additionally, Polygon’s total value locked in the DeFi ecosystem rose by over 10% in the past seven days to $951 million, according to DeFiLlama.
However, the network faces substantial competition in the layer-2 industry from Arbitrum (ARB) and Base, which hold over $2.82 billion and $1.6 billion in assets, respectively. Arbitrum has also become one of the most active DEX networks, managing over $3.7 billion in transactions in the last seven days.
The transition from MATIC to POL will bring new network capabilities. POL will provide services to any chain in the Polygon network, including AggLayer, and will serve as the gas and staking token for Polygon’s proof-of-stake network, anticipating potential volatility toward the POL launch.
Polygon remains above the 50EMA
Technically, Polygon has crossed the 50-day moving average and is at the 23.6% Fibonacci Retracement point.
Previously, it failed to move above that retracement point in July this year.
The token has since formed a bearish engulfing candlestick pattern, indicating a potential pullback to the 50 EMA level at $0.493.
