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Recent data indicates increased on-chain activity for the Ethereum layer-2 network Polygon, although the token's price remains at depressed levels. A “notable spike” in both active addresses and the reactivation of dormant coins on the Polygon network.
On August 28, Santiment, a blockchain analytics platform, reported a significant uptick in on-chain activity for {Polygon} (MATIC). The analytics highlighted a surge in the movement of dormant tokens and an increase in active addresses engaging with the network. This rise in activity is seen as a indicator of a possible reversal in the price trend of Polygon's native token, MATIC.
Historically, Polygon has faced a decline in address activity since late July,with the number of interacting addresses dropping from 1.6 million to approximately 70,000 by late August—a reduction of about 50%. Daily transaction volumes also showed a downward trend, decreasing from over 5 million transactions in March to around 3 million in late August.
Despite this recent surge in activity, MATIC prices remain subdued. On August 25, the token reached a two-month high of approximately $0.58 but failed to maintain that level. As of August 29, MATIC has retraced to $0.437, marking a 24% decline from its peak and a further 5% drop in the preceding 24 hours. This places MATIC approximately 85% below its all-time high of $2.92 reached in December 2021.
Adding to the complexity, Binance has announced support for the upcoming network token migration from MATIC to POL, scheduled for September 4. Furthermore, the Polygon community’s Discord channel experienced a significant security breach on August 24, affecting the servers of multiple blockchain projects.
Overall, while the recent increase in on-chain activity could signal future developments for Polygon, the current price trajectory and external challenges highlight a complex landscape for the layer-2 network.
