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Polygon’s Q1 2024: Activity, demand skyrocket, yet revenue dips

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The high user activity on Polygon in Q1 failed to impact its network’s revenue during that quarter.

Polygon

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  • Polygon’s revenue fell in Q1.
  • This occurred despite the growth in its network usage during that period. 

In a new report, Messari found that Layer-2 scaling platform Polygon [MATIC] recorded a decline in quarterly revenue between January and March. 

According to the on-chain data provider, the revenue decline occurred despite the uptick in Polygon’s network activity during the period under review. 

Between 1st January and 31st March, the network’s revenue totaled $7 million, representing a 19.3% decline from the $10 million recorded in the last quarter of 2023.

Q1’s figure also marked a 42% decrease from the $12 million Polygon saw in quarterly revenue in Q1 2023.

Surge in network activity

As highlighted above, the quarter under review was marked by an uptick in activity. During that period, the network recorded an average daily active address count of 814,000. 

According to Messari’s data, this was a 118% spike in quarterly daily active addresses on the network, marking its highest over a 12-month period. 

Poylgon Daily active addresses

Source: Messari

New demand for Polygon also increased. During the quarter under review, the average number of new addresses that were created on the L2 network was 127,400, marking a 69% growth from the previous quarter’s 75,900.

Due to the rise in the number of active addresses that frequented Polygon in Q1, the number of transactions completed on it also skyrocketed. Per the report, the proof-of-stake (PoS) network averaged 4 million daily transactions in Q1 2024.

Polygon daily transactions

Source: Messari

Regarding the network’s decentralized finance (DeFi) vertical, Polygon closed Q1 with a total value locked (TVL) of $1.4 billion. This was a 30% jump from its Q3 2023 DeFi TVL of $1.1 billion. 


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


On how the DeFi protocols housed within Polygon fared during the quarter in review, Messari noted:

“In Q1 2024, Aave continued to lead as the dominant protocol by TVL on Polygon PoS, with its TVL rising to $705 million, marking a 35% increase from the previous quarter. Uniswap jumped to the second position, with its TVL reaching $130 million, up 41% QoQ.”

Lastly, Polygon’s non-fungible tokens (NFTs) ecosystem saw an 18.4% spike in sales volume in the first three months of the year. 

 

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Abiodun is a full-time journalist working with AMBCrypto. He is also a lawyer with over 2 years of experience. With a keen interest in blockchain technology and its limitless possibilities, Abiodun spends his time understanding the technology, building projects, and educating people about it.
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