Recent months have witnessed a high level of excitement within the cryptocurrency market as Polygon’s MATIC underwent an upgrade to POL. As detailed previously by CryptoCrypto, the official migration from MATIC to POL took place on September 4, 2024.
This shift marked the transformation of MATIC into POL as the designated network token for Polygon. Essentially, all transactions conducted on Polygon PoS now utilize POL as the intrinsic gas token.
This migration potentially breathed new life into Polygon’s token following a period of sustained decline in its performance. Preceding the migration, MATIC had been on a downward trajectory, registering a 10.75% drop on weekly charts and a 7.38% decrease on monthly charts.
However, following the transition, the altcoin experienced some modest gains. Presently, at the time of reporting, POL is trading at $0.3773 after a 1.45% increase in a 24-hour period. Moreover, its market capitalization surged by 3.44% to reach $2.1 billion within the same timeframe.
Undeniably, the prevailing market conditions have displayed a favorable outlook toward POL, highlighting the significance of the upgrade. Notably, Santiment’s analysis unveiled a spike in network expansion and a notable increase in total holders.
Evaluating the Current Market Sentiment
According to Santiment’s analysis of Polygon’s ecosystem, POL has witnessed remarkable growth on the network front. The creation of new daily addresses totaled 487 at the time of writing, positioning the altcoin on track to surpass MATIC’s figures within 2 weeks.
Furthermore, since August 15, a substantial number of MATIC holders have liquidated their holdings to facilitate the transition. During the same period, a noteworthy 1826 POL wallets were established, signifying a 64% surge in numbers.
Moreover, the market observed a decrease in the percentage of POL supply held by wallets with over 1 million tokens, dropping from 98% to 92% over 2 weeks. Such occurrences typify scenarios where smaller and mid-sized traders swiftly engage with a new asset. This trend may decelerate following Binance’s introduction of trading pairs. As previously outlined by CryptoCrypto, Binance is set to remove MATIC pairs from listing beginning September 10.
Another factor contributing to heightened interest in the altcoin is the current price volatility. Over recent weeks, various altcoins have encountered significant price fluctuations.
Lastly, traders are drawn to POL due to the potential long-term benefits it offers. Notably, the token permits multi-chain staking while providing users with enhanced governance control.
Decoding POL’s Chart Patterns
As highlighted by Santiment, POL has experienced a degree of market favorability in the three days post-migration.
Initial findings reveal that the OI-weighted funding rate has sustained positivity for two consecutive days, with only a single day reporting a negative value.
The positive OI-weighted funding rate signifies an increased demand for long positions, indicative of investors’ anticipation of further price appreciation – a positive sentiment marker.
Furthermore, POL’s supply outside of exchanges has decreased from $214 million to $202 million since the migration. This market behavior hints at investors adopting a long-term perspective and being less inclined to engage in short-term selling. Such behavior underscores investors’ confidence in the altcoin’s future potential.
Consequently, under the favorable market conditions, the altcoin stands poised to surpass the $0.38 resistance level and potentially reach $0.4 in the near term.