- Rocket Pool’s rETH integration on Polygon opens new opportunities for growth in the competitive DeFi sector.
- The performance of Polygon’s DEXes and MATIC token’s market sentiment influences its trajectory.
The DeFi space has become increasingly crowded in recent years, with dominant players holding sway. As a result, networks like Polygon have faced difficulties entering this space.
In the highly competitive DeFi sector, various Liquid Staking Derivatives (LSD) protocols have been experiencing significant growth.
Will the Rocket Pool help Polygon get to the moon?
However, Polygon has the potential to benefit from the LSD space as the proposal to bring rETH to Polygon’s zkEVM gains momentum. The expansion of rETH to Polygon’s zkEVM will be facilitated by a community developer’s launch of a rate provider, incentivized by Polygon Labs with $50k USDC to foster liquidity growth.
This development opens up exciting opportunities to pair rETH with stablecoins and utilize it as collateral on platforms like Aave and QiDao. The integration of oracles and rETH/USDC pools will further enhance liquidity and streamline liquidations within the Polygon protocol.
Check it out, and give us feedback + your thoughts. https://t.co/SvpuVYbqwz
— Jack Melnick (@jackmelnick_) June 16, 2023
In addition to the introduction of rETH, other factors will also impact Polygon’s future in the DeFi sector. The performance of Polygon’s decentralized exchanges (DEXs) is critical.
At present, Meshwap, a popular DEX on the network, has witnessed a decline of 7.8% in terms of unique active wallets using the protocol. Consequently, the transaction volume on the platform has also fallen during this period.
As one of the largest collections on Polygon’s NFT space, y00ts has experienced substantial growth in its average floor price. However, its volume has declined by 49.2% over the last week, and the number of wallets holding this collection also significantly decreased.
MATIC takes a hit
Examining the token associated with Polygon, MATIC, we observe a similar pattern. Its price has fallen significantly in recent weeks, accompanied by a decline in network growth. This suggests a loss of interest from new addresses in the token.
Realistic or not, here’s MATIC market cap in BTC’s terms
Furthermore, the decline in MVRV ratio indicates reduced profitability for current MATIC holders and lower selling pressure. However, the long/short difference indicates that many of these addresses are short-term holders who are likely to sell their holdings at the first sign of profit.