MATIC suffers another string of losses as the broader market pullback forces the bulls to the defensive. According to CoinGecko, the Polygon Network native coin has bled 16% more since last week as the bears reverse gains made back in August. This move occurred despite Polygon Network’s upcoming upgrade that switches MATIC to POL, improving the platform’s tokenomics.
As the market moved 5% downward, investor confidence in MATIC has been shaken, possibly damaging the token’s performance in September. Short-term, investors are looking at more pain if the market continues to freefall.
Momentum Lost After Hype-Led Rally For MATIC
MATIC bears are currently attempting to break through the $0.39 support level after ten days of a consistent downward trajectory. This leaves the bulls in a precarious position in the short term as a bearish breakthrough on this support level will drive the token toward $0.33, a level unseen since March 2021.
With the major cryptocurrencies also experiencing strong bearish momentum, we can expect MATIC to fall even further despite the improvements brought by the upcoming network upgrade. Investors and traders can expect the token to fall further, possibly flipping the $0.39 support level to resistance.
Investors and traders could expect increased volatility depending on the condition of the larger market once this action starts. Although much of the market moves in line with the swings of the two leading cryptocurrencies, market movers like Bitcoin and Ethereum should also be under observation.
Network Migration And New On-chain Developments
The MATIC to POL migration will start today, September 4, which affects all facets of the network. According to an earlier blog post, the network migration will improve the tokenomics of the platform making it more attractive for users and future validators.
One of the most notable developments for the community is the enhanced protocol awards system that is expected to encourage more validators to the platform. The protocol will continuously emit a predefined number amount of POL, distributing it to the all active validators. This acts as the base reward for the platform’s validators.
Polygon CDKs are being shipped to mainnet
AI clouds are transforming gaming
Next-gen DeFi consumer app en routeAll this and more – your DeFi roundup on @0xPolygon 🧵👇 pic.twitter.com/pjRkr1B9z6
— Polygon DeFi (@0xPolygonDeFi) September 3, 2024
Validators will also have access to the chains’ transaction fees, becoming of the three main income streams in the new system. Lastly, some chains within the ecosystem can set their own rewards using POL, or any cryptocurrency available on that specific chain, stimulating on-chain validator activity.
On-chain, the platform has also seen use of Polygon’s core development kit (CDK) on multiple projects. These projects will have a definite effect on the user experience of the platform, cementing Polygon’s position within the DeFi world.
Featured image from Pexels, chart from TradingView