Polygon (MATIC) has been experiencing a decline in network activity since the broader crypto market retrace began in March.
However, recent data shared by the crypto analytic platform Santiment indicates a potential shift in this trend.
Bullish Reversal for Polygon (MATIC)?
Polygon’s native token, MATIC, has lost over 17% of its value in the past month alone as it traded mostly below $0.52. Subsequent declines dragged the asset to the press time price of $0.43, but this could be an opportunity for buyers to amass it at a low valuation.
In its latest post on X, Santiment observed there had been a notable rise in dormant token transactions on August 28th, coinciding with the second-largest number of Polygon addresses interacting with the network this year.
In fact, a total of 3,369 addresses interacted on-chain on Polygon as the Age Consumed metric spiked to 69 billion MATIC on the same day. Both of these metrics often serve as precursors to market reversals.
As such, these signals suggest that MATIC could be on the verge of a recovery, potentially marking the beginning of a much-needed bullish phase for the network as it emerges from its prolonged downtrend.
The Migration: MATIC to POL
The Polygon ecosystem is preparing for the official switch from MATIC to the POL token, scheduled for September 4 this year. This upgrade will essentially see POL take over as the native gas and staking token for Polygon’s Proof of Stake (PoS) chain, reflecting an important milestone in the Polygon 2.0 roadmap released last year.
The POL upgrade was initially launched on the testnet on July 17 to facilitate a smooth transition. The main focus of this phase was to detect and address potential issues, allowing users and developers to get accustomed to the new system before the mainnet upgrade.
MATIC holders on the Polygon PoS chain will experience an automatic, seamless conversion to POL. The users are not required to take any action from their end. However, MATIC holders on Ethereum, Polygon zkEVM, or centralized exchanges will need to upgrade manually through a migration contract on Ethereum, as reported earlier.
This week, Binance announced its support for this upcoming transition.