Polygon declined for the first time in 10 days, even after seeing encouraging indicators on its non-fungible token and decentralized finance ecosystem.
DEX Volume and NFT Sales Increase
Polygon (MATIC) retreated to a low of $0.53, down from last week’s high of $0.582. It remains 60% higher than its low this month as the countdown to MATIC’s transition to POL on September 4 continues.
Polygon’s removal came after developers regained control of its X account following a recent hacking incident.
Third-party data shows that the Polygon ecosystem is doing well. According to CryptoSlam, weekly NFT sales increased by 111% to over $12.7 million. The number of buyers jumped by 35% to 88,000, while the number of sellers increased to 25,000.
Polygon processed 356,700 transactions, while trading volume fell 12% to $9.2 million. It is the fourth-largest player in the NFT market after Ethereum (ETH), Solana (SOL), and Bitcoin (BTC).
Polygon also performed well in the DEX sector, where its volume increased by 7.32% to $770 million. It is the seventh largest player after Ethereum, Solana, and Tron. Some of the most active DEX networks in the ecosystem include Uniswap, Quickswap, Woofi, Dodo, and Retro.
Additionally, Polygon’s total value locked in the DeFi ecosystem has increased by more than 10% in the last seven days to $951 million.
However, the network faces significant competition in the Layer 2 space from the likes of Arbitrum (ARB) and Base, which have accumulated over $2.82 billion and $1.6 billion in assets. Arbitrum has also become one of the most active DEX networks, managing over $3.7 billion in the last seven days.
The next evolution of the Polygon ecosystem will be the transition from MATIC to POL, which will introduce new features to the network. It will be used to provide services to any chain on the Polygon network, including AggLayer.
It will also be the native gas and staking token for Polygon’s proof-of-stake network. Polygon may experience increased volatility as POL’s launch approaches.
Polygon remains above 50-day exponential moving average
Technically, Polygon has crossed above the 50-day moving average and is hovering around the 23.6% Fibonacci retracement point.
Previously, it failed to break above this retracement point in July this year.
The token has since formed a bearish engulfing candlestick pattern, indicating a potential pullback, perhaps to the 50 EMA level at $0.493.
