Polygon (MATIC) has bucked the trend among major altcoins this year, witnessing a rare negative price performance since January 1.
The cryptocurrency’s value has plummeted due to factors such as delistings prompted by US Securities and Exchange Commission (SEC) scrutiny and the recent broader market downturn. This downturn has put Polygon’s resilience to the test, highlighting the challenges altcoins can face in a volatile market.
MATIC facing potential 27% downside
Furthermore, the extended decline in MATIC’s price has raised concerns about its susceptibility to further drops, crypto analyst Ali Martinez stressed on August 28.
Currently hovering slightly above the pivotal support at $0.54, a breach of this level might expose Polygon to additional risks, potentially leading to a descent towards the $0.40 mark, implying a possible downside of more than 27%.
According to Martinez, this vital support at $0.40 is currently being “guarded by 3,770 addresses holding over 70 million MATIC.”
Polygon price analysis
At the time of publication on August 29, MATIC was changing hands at $0.56, up 1.38% in the past 24 hours.
Over the past week, the altcoin gained around 1.6% while losing over 21% on the month. Notably, MATIC’s market cap declined by nearly $1.5 billion during this 30-day period.
Year-to-date, MATIC is down about 26.5%, in contrast to other major altcoins such as XRP (XRP), Solana (SOL), and Ethereum (ETH) which saw noteworthy gains since the start of 2023.
Polygon co-founder shares update on Polygon 2.0
Meanwhile, Polygon co-founder Sandeep Nailwal revealed an important update on August 28 regarding MATIC’s migration to a new POL token – a move outlined in the Polygon 2.0 proposal earlier this year.
Namely, in the post, Sandeep explained how Polygon users can easily migrate to POL without losing their MATIC rewards that are currently staked.
Nailwal highlighted that POL offers the advantages of multi-chain staking without the additional risks of restaking. In particular, Polygon 2.0 would allow the blockchain’s ecosystem to expand from a single chain to an ecosystem of layer-2 chains that can easily interoperate and share liquidity with each other.
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