MATIC's price decline and low MVRV-Z score suggest undervaluation amid Polygon's growth and network activity.
Over the past month, MATIC’s price has declined from $0.99 to $0.88, showing a noticeable downward trend. This drop in price has raised concerns among investors and analysts.
Alongside the decrease in price, MATIC’s trading volume fell as well, suggesting a reduced level of market participation and interest in the token. Similarly, the transaction count of MATIC waned, indicating less activity involving the token.The Polygon protocol itself has been experiencing a significant surge in activity. According to Token Terminal, the number of daily active users on Polygon increased by 29.5% over the past month.
However, despite the increase in activity, the revenue generated by the protocol fell during this period. This raised questions about the sustainability and profitability of the ecosystem.The surge in activity on Polygon can be attributed to the success of certain decentralized applications on the network. QuickSwap, a popular dApp on Polygon, has experienced a surge in unique active wallets, as well as an increase in trading volume and the number of transactions.
This indicates that QuickSwap has successfully attracted users to the platform and has provided them with valuable services.However, not all dApps on the Polygon network have seen significant growth. According to PeckShield, a crypto security firm, there was an exploit on wDAO EON, a protocol on the Polygon network.
Moreover, such exploits can negatively impact user sentiment and confidence in the protocol, potentially hindering its long-term growth. Investors and users may become wary of participating in platforms that have security vulnerabilities.
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