- Polygon Labs rolled out the “hyperproductive” POL ecosystem token.
- POL (ex. MATIC) flops to an all-time low as Spot volume fails to pick up.
- Analyst sees “upside potential”, but MATIC traded below $1 since April.
Polygon (MATIC) has recently rebranded itself as Polygon Ecosystem Token (POL). Polygon’s latest agenda to infinitely scale Ethereum’s Layer-1 chain through an aggregated chain architecture sparked trader enthusiasm in mid-September when the Binance-supported MATIC to POL migration was met with an 18% price surge for the token.
However, the latest major upgrade ruffled investors’ feathers with an inflationary adjustment in the coin’s tokenomics. According to the Polygon ecosystem’s roadmap, the new token has a 2% annual inflation rate despite POL being swapped 1:1 for MATIC.
Originally, MATIC was capped at 10 billion tokens, and part of the processed gas fees was used for token burning. The new token’s tokenomics reserve 1% of annual token emission fees to fund validators and another percent for chain development.
Currently, the Layer-2’s native POL token is trading at $0.3169, hitting an all-time low of $0.3146 just 15 minutes ago. Polygon’s trading volume of $76 million puts the altcoin at the bottom of crypto’s TOP 100 by trading volume, as well as one of the worst-performing alts of last week, succumbing to a 14.6% 7-day deficit.
Is $1 Still Within Reach for Polygon’s MATIC?
MATIC hasn’t surpassed the $1 checkpoint since April 1, 2024. Based on technical analysis, analyst Ali Martinez’s chart below depicts 0.786 Fibonacci retracement levels, which align with MATIC’s $1 price target.
The crypto trader believes in “upside potential” significantly outweighing the 15% downside risk, marking $0.89 as the first target, adding a more optimistic approach with the long-term target of $8.
In contrast, the short-term outlook looks far from bullish on MATIC’s four-hour trading price charts. For one, the technical implications of the Stochastic Relative Strength Index (StochRSI) hovering between 74 and 62 constitute an overbought POL condition. On top of that, the Chaikin Money Flow (CMF) plunged deep below zero, flashing -0.20 and representing negative big holder flows.
On the Flipside
- Current POL holders in profit encompass less than 1% of all investors, according to IntoTheBlock.
- Polygon’s 14.6% monthly price flop is partly ascribed to Ether’s multi-year lows in pair with BTC.
Why This Matters
Aside from L2 scaling power, Polygon Labs stands out among other popular altcoins in retail adoption, inking deals with major brands like Nike, Starbucks, Mastercard, Adobe, and Google.
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