Polygon’s native token has performed poorly amid the crypto market downturn. A deep dive into on-chain data suggests that the MATIC price may experience more downswing, given the lack of retail interest.
The Polygon Network Isn’t Growing
Polygon is a Layer-2 scaling solution designed to mitigate Ethereum’s throughput issues and exorbitant gas fees. Ethereum’s successful transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS) appears to raise concerns about the Polygon ecosystem’s long-term viability.
On-chain data from Glassnode shows the volume of new addresses created on the Polygon network has steadily declined since December 2022. The downtrend now appears to have been exacerbated by the recent announcement of the Shanghai upgrade slated for April 12.
After the early March resurgence, new daily addresses created on the Polygon blockchain entered another downswing on March 17, a few days after the Shanghai upgrade date was announced.
Indeed, the number of new daily addresses on the Polygon network has declined 32% from the local high of 1,960 addresses created on Feb. 17 to 1,318 addresses as of March 21.
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Author: Ibrahim Ajibade
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