Polygon On-Chain Activity Lights Up: MATIC Reversal Incoming?
August 29 2024 - 2:30PM
NEWSBTC
On-chain data shows that some activity metrics related to Polygon
have surged recently, which could be positive for the asset’s
price. Polygon Active Addresses & Age Consumed Have Spiked
Recently In a new post on X, the on-chain analytics firm
Santiment discussed the latest trend in two MATIC indicators.
The first is the “Daily Active Addresses,” which
tracks the total number of addresses participating in some
kind of transaction activity on the network every day. The unique
number of active addresses can be considered the same as the unique
number of users participating in network activities, so the value
of this metric tells us about the amount of traffic that the
blockchain is observing right now. Related Reading: Bitcoin
Plummets To $59,000, On-Chain Data Reveals Why When the indicator’s
value rises, more users are becoming active on the network. Such a
trend implies that cryptocurrency is attractive to investors. On
the other hand, the metric registering a decline suggests investor
interest in the asset could be declining as fewer users make
transfers on the blockchain. Now, here is a chart that shows the
trend in the Daily Active Addresses for Polygon over the past few
months: The above graph shows that the Polygon Daily Active
Addresses has recently experienced a surge. At the peak of the
latest spike, 3,369 MATIC addresses made transactions on the
network, the second-highest value for the year. Thus, investors
appear to have been actively engaged on the network recently. It
can generally be hard to say what the consequences of such activity
may be for the asset, as both selling and buying activity would be
flagged up in the indicator. One thing that can generally be said
is that high user activity may lead to cryptocurrency
volatility. In the current case, though, there may be one other
hint: the surrounding price action. Interestingly, the largest
spike in the indicator only came just after MATIC’s latest price
decline, which could imply that investors may be rushing to buy the
dip. If this is the case, then Polygon could benefit from a
turnaround in the activity. The second indicator in the chart is
the “Age Consumed,” which tells us whether dormant coins are on the
move. From the chart, it’s visible that a large number of old
tokens appear to have moved on the network during the latest
activity rush. This can be a mixed signal, as it could
suggest that the asset’s diamond hands are selling. It’s
also possible that these investors have only shifted the coins for
some other activity, as the last Age Consumed spike of a similar
scale proved bullish for Polygon. Related Reading: Litecoin Sees
Sudden Exodus Of Retail Investors: Why This Can Be Bullish Given
the spikes these on-chain indicators have witnessed, how the coin
develops from here remains to be seen. MATIC Price Polygon’s price
has plunged almost 17% over the past week to $0.43. Featured image
from iStock.com, Santiment.net, chart from TradingView.com
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