Polygon’s MATIC token will be rebranded as POL on September 4, stirring significant discussion within the cryptocurrency community. This update is a crucial element of the Polygon 2.0 roadmap, designed to bolster the network’s security and utility. Notably, 97.74% of MATIC investors are experiencing losses, raising uncertainties about whether the rebrand will rejuvenate the struggling altcoin.
What Does On-Chain Data Reveal?
Recent on-chain data presents a concerning picture for MATIC. Since mid-April 2024, Polygon’s daily active addresses and overall network growth have been on a downward trajectory. For example, between August 11 and August 12, active addresses plummeted from 500,000 to 88,200, and transactions decreased from 130,000 to 16,900, highlighting dwindling user engagement.
Adding to these woes, most MATIC investors are currently at a loss. Data from IntoTheBlock indicates that 97.74% of MATIC investors are in the red, while only 1.49% are in profit, underscoring the severe investment challenges faced by the community.
Can Technical Analysis Indicate a Reversal?
Despite these challenges, technical analysis offers a glimmer of hope. MATIC’s price is forming an ascending triangle, a bullish indicator that might spark a rally if it breaks the upper resistance. Currently trading below the 200-day and 50-day EMAs, a breakout at the minor resistance level of $0.4348 could pave the way to test $0.5047.
Moreover, the Relative Strength Index (RSI) is neutral at 49.14, indicating that MATIC is neither overbought nor oversold. Additionally, the Chaikin Money Flow (CMF) indicator stands at a positive 0.13, suggesting mild buying pressure that could lead to a breakout.
Key Takeaways for Investors
Investors can draw several actionable insights from the current scenario:
- MATIC holders face significant losses, with 97.74% of investors in the red.
- Network engagement has sharply declined since mid-April 2024.
- A potential bullish reversal is possible if the ascending triangle formation breaks the upper resistance.
- Technical indicators like RSI and CMF suggest neutral to mildly positive sentiment.
The upcoming rebranding of MATIC to POL on September 4 aims to reinvigorate investor interest and enhance the utility and security of the Polygon network. The market response to this shift will be crucial for the future of the altcoin.