After SEC claimed that matic is a security, a lot has happened to Polygon in the recent weeks, with the majority of them being bullish signs. Besides, the whole crypto market rejoiced following Ripple's "partial" victory against SEC, translated into a greedy market sentiment along with a massive jump in XRP price.
As of today, the price of Matic is playing just under $0.8 level, being ready to make the next move. In today's multi-dimensional price analysis, I will take a look at the most possible scenario ahead.
A review of recent fundamental events
Despite toxic regulatory atmosphere (thanks to SEC) and ongoing legal cases, there have been positive fundamental news spreading about Polygon. On July 12. Polygon introduced “Polygon 2.0,” aiming to become the “value layer of the internet.” This set of upgrades will include higher scalability, enhanced coordination between the chains built on Polygon, higher capital efficiency, and decentralization of the governance. As part of the Polygon 2.0 roadmap, the team has also proposed to rename Matic to Pol, and making its native token a multipurpose token for all chains. Such token upgrade will undoubtedly result in more demand and usability for the token, pushing the price upwards.
Polygon Labs announced Polygon 2.0
Along with the fore-mentioned moves, Polygon released a ChatGPT-based AI tool to help developers launch their apps. Additionally, Polygon appointed its former CLO, Marc Boiron, as the new CEO. This may seem contradictory to the vision of a decentralized governance, but personally, I believe that this is necessary for reaching the goals of Polygon 2.0 as soon as possible.
What's happening to Matic onchain?
Though the holders are distributing, the majority of their tokens are going to rest in cruisers’ wallets rather than short term holders, or traders if you may. This means that there is nothing to worry, since speculative behavior can’t stab the price if it continues the rally.
Balance by Time Held (Source: Intotheblock)
Meanwhile, the entities with the medium to large balances (investors and whales) have the upper hand, holding roughly 85% of the circulating supply.
Historical Concentration (Source: Intotheblock)
Now let’s deep dive and take a look at two other factors. Total value locked (TVL) on the Polygon network is experiencing a rapid rise in mid-term, reaching just above 1.3b matic. This means that more and more tokens are going out of the market.
TVL on Polygon network in Matic (Source: DefiLlama)
Regarding how much money is the protocol making, the data are not sending bullish signals. The earnings still remain sub-zero. The only light here comes from the fact that at least the earnings are getting “less negative.”
Daily earnings (Source: Token Terminal)
What do psychological metrics say about matic?
Last but not least, we need to consider the sentiment over matic. Speaking of which, the futures market data (which mainly represents the behavior of professional traders,) reveals that they are bullish on matic. This can be understood by looking at rising volume of open interests (comparing to mid-June to mid-July) and the funding rates. Bulls are betting on matic.
Matic futures OI (Source: Coinglass)
Matic futures funding rate (Source: Coinalyze)
The overall sentiment, based on the news and social platforms, signals a bullish view too.
Sentiment on Polygon(Source: Marketpsych)
Final thoughts
Overall, the fundamental, on-chain, and sentimental indices back the price with continuing its upward move. While the price has successfully broke the 50-day moving average (the dotted line in yellow,) still a downward trendline is blocking its path. If the bulls push the price hard enough, it can pass a resistance confluence comprising a horizontal resistance line and the descending trendline. Finally, a consolidation above $0.8 level will strengthen the bullish scenario ahead of matic.
Matic daily price chart (Source: Tradingview)
