Polygon [MATIC] steps up its game in terms of partnerships, but investors have reasons to worry
- Polygon’s fees, revenue, and daily active addresses declined over the past few days.
- On-chain metrics were bearish, suggesting a further downtrend.
Polygon [MATIC] has been registering a decline in fees and revenue over the last seven days. In addition, Artemis’ chart pointed out that Polygon’s daily active addresses also went down last month.
Read Polygon’s [MATIC] Price Prediction 2023-24
However, Polygon’s co-founder Sandeep Nailwal, in a tweet posted on 4 May, gave hope for a trend reversal. The tweet revealed several developments that happened in the Polygon ecosystem, which could show their impact in the coming days.
Four large scale things happened in @0xPolygon ecosystem in last 10 days
1. Google announced its support for Polygon Supernets(appchains) and committed to supporting startups on Polygon in a joint fund with @0xPolygonLabs
2. @Sothebys launched their NFT marketplace @onPolygon_…
— Sandeep Nailwal | sandeep. polygon 💜 (@sandeepnailwal) May 3, 2023
Quite an eventful week for Polygon
The most notable development was Google’s announcement of its support for Polygon Supernets (appchains). The tech giant said it will support startups on Polygon in a joint fund with the network.
This can lead to a spike in the development of the Polygon network, which in turn can help the network grow.
Google Cloud will help accelerate adoption of core Polygon protocols w/ enterprise infrastructure & tools.
🤝🏽 strategic alliance to increase transaction throughput enabling use cases in gaming, supply chain & DeFi #onPolygon🤗https://t.co/POKztinzKP pic.twitter.com/r5P94YaQDt
— Polygon (Labs) (@0xPolygonLabs) April 27, 2023
The blockchain’s DeFi space also got a boost as Franklin Templeton plans to tokenize large scale regulated financial products for Polygon. This move can aid in increasing Polygon’s TVL, which has been stagnant for several months.
Can a new marketplace help Polygon NFTs?
Apart from the aforementioned developments, Sotheby’s launched its NFT marketplace on the blockchain. The new launch might provide support for Polygon’s dwindling NFT metrics.
As per Santiment, the blockchain’s NFT trade count and trade volume in USD declined sharply last week. Additionally, CRYPTOSLAM’s data suggested that NFT sales volume also declined marginally in the past seven days.
Not only NFTs, but the blockchain also registered a decline in the number of stakers, as evident from Staking Rewards’ chart. However, Blockdaemon extended support for Polygon staking, which too can show its effect in the coming days.
Big news! 🎉 We're thrilled to announce that #Blockdaemon now supports @0xPolygon with our cutting-edge Staking API!
This integration further expands our commitment to make staking seamless across multiple protocols. 🔗
— Blockdaemon 😈 (@BlockdaemonHQ) May 4, 2023
MATIC’s state is dire
MATIC‘s performance on the price front remained dormant throughout the last week, despite the big announcements.
According to CoinMarketCap, MATIC’s price declined by over 1.4% in the last seven days. At the time of writing, MATIC was trading at $0.9888 with a market capitalization of more than $9.1 billion.
A look at MATIC’s on-chain performance gives an idea of what went wrong.
Realistic or not, here’s MATIC’s market cap in BTC terms
As per CryptoQuant, MATIC’s exchange reserve was increasing, which is bearish, as it indicated that the token was under selling pressure. The total number of coins transferred has also decreased by 86.12% compared to the day before.
In addition to that, MATIC’s open interest increased in the last few days. If open interest is on the rise, it signals that the market trends around that option are likely to continue, which increases the chances of a continued downtrend.