Is MATIC undervalued? New data indicates…

• MATIC’s price decline and low MVRV-Z score indicated potential undervaluation.
• Activity surged, but declining revenue and exploit raised questions about long-term growth.

Polygon [MATIC], a blockchain protocol that has been experiencing significant growth and activity, has failed to see a commensurate increase in the price of its native token. This has led many to believe that MATIC was undervalued.

According to Santiment’s 5 June data, MATIC’s MVRV-Z score was low, indicating that it was in an underbought zone.

📊 Several of the largest #altcoins show undervaluation when combining short, mid, and long term realized capitalizations. Market caps are above realized caps for $XRP, $ADA, $DOGE, $MATIC, $SHIB, $UNI, & $LINK, hinting many may make up ground this summer. https://t.co/3wLIFZ8B90 pic.twitter.com/WMzy4imOO9

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— Santiment (@santimentfeed) June 4, 2023

Is MATIC underrated?

Over the past month, MATIC’s price has declined from $0.99 to $0.88, showing a noticeable downward trend. This drop in price has raised concerns among investors and analysts.

Alongside the decrease in price, MATIC’s trading volume fell as well, suggesting a reduced level of market participation and interest in the token. Similarly, the transaction count of MATIC waned, indicating less activity involving the token.

The Polygon protocol itself has been experiencing a significant surge in activity. According to Token Terminal, the number of daily active users on Polygon increased by 29.5% over the past month. This uptick in user activity highlighted the growing adoption and utilization of the Polygon network.

However, despite the increase in activity, the revenue generated by the protocol fell during this period. This raised questions about the sustainability and profitability of the ecosystem.

State of the dApps

The surge in activity on Polygon can be attributed to the success of certain decentralized applications (dApps) on the network. QuickSwap, a popular dApp on Polygon, has experienced a surge in unique active wallets, as well as an increase in trading volume and the number of transactions.

This indicates that QuickSwap has successfully attracted users to the platform and has provided them with valuable services.

Realistic or not, here’s MATIC’s market cap in BTC’s terms

However, not all dApps on the Polygon network have seen significant growth. According to PeckShield, a crypto security firm, there was an exploit on wDAO EON, a protocol on the Polygon network.

Moreover, such exploits can negatively impact user sentiment and confidence in the protocol, potentially hindering its long-term growth. Investors and users may become wary of participating in platforms that have security vulnerabilities.

#PeckShieldAlert Seems like wDAO EON has been exploited for $30K.https://t.co/Odx8RudDrx
The original exploiter, 0xb3d2…1fdc, has been front-run by 0xcb35…bb5b. https://t.co/0NOK3jhelL. @peckshield

— PeckShieldAlert (@PeckShieldAlert) June 2, 2023