Whale Accumulation Fuels Bullish Signals for Polygon's MATIC Token During Market Correction

Amidst a broader market correction, whales are reportedly accumulating Polygon's native token MATIC. Technical analysis suggests a bullish trend, potentially pushing MATIC towards resistance levels at $0.95 and $1.29. Polygon's network activities, including increased daily active addresses, NFT popularity, and DeFi usage, indicate positive momentum. Despite this, the total value locked (TVL) has declined, possibly due to users seeking higher yields elsewhere.

Whale Accumulation Signals Bullish Outlook for Polygon's MATIC Token Amidst Market Correction

Amidst the ongoing crypto market turmoil that has dragged many assets below crucial support levels, Polygon's native token, MATIC, is attracting whales' attention, sparking optimism for its future trajectory.

Whales Aggressively Accumulating MATIC

Recent on-chain data from Lookonchain reveals that an unidentified whale has substantially increased its MATIC holdings, signaling confidence in the layer-2 blockchain's long-term prospects. The whale withdrew approximately 1.9 million MATIC tokens (worth $1.41 million) from the Binance exchange to a decentralized on-chain wallet. This whale accumulation has been accompanied by significant withdrawals of other crypto assets, including AVAX, FET, GRT, OP, and RNDR.

Technical Analysis Points to Potential Upswing

Crypto analyst Scalping has identified a bullish trend forming in MATIC's daily chart, characterized by a broadening wedge pattern. Scalping predicts a bullish breakout if MATIC manages to hold above $0.63 by the end of the day. Should this condition be met, MATIC is poised to surge towards $0.95, with a subsequent target at $1.29.

However, it's worth noting that MATIC's previous attempt to breach the $1 mark in February 2021 ended abruptly after the April Fool's Day crash. The asset has since struggled to regain its lost ground.

Booming Polygon Network Activities

Beyond technical indicators, Polygon's underlying network activities provide solid fundamental reasons for its bullish outlook. The Polygon Proof of Stake (PoS) network has surpassed 1 million daily active addresses for an impressive 25-day period, signaling sustained growth in network usage.

Non-Fungible Tokens (NFTs) and Decentralized Finance (DeFi) have also witnessed a surge in popularity on Polygon. Dune Analytics data analyzed by Crypto News Flash (CNF) shows a significant increase in DEX trading volume and revenue generated.

TVL Decline: A Cause for Concern?

Despite the increase in network activity, Polygon's Total Value Locked (TVL) has experienced a noticeable decline lately. This indicates that users are not necessarily locking more funds in Polygon's DeFi protocols. One possible explanation for this is that users may be shifting funds to alternative platforms offering higher yields.

Nonetheless, Polygon's commitment to innovation continues to impress. Its co-founder, Brendan Farme, recently hinted at the potential implementation of the EIP-4844 proposal, which could significantly reduce transaction costs. Polygon Labs CEO Marc Boiro believes that this upgrade could drive mass adoption for MATIC.

Conclusion

Whales' aggressive accumulation of MATIC, coupled with bullish technical indicators and rapidly growing network activities, suggests that MATIC is well-positioned for a potential upswing amidst the ongoing market correction. While the asset's previous failure to sustain above $1 remains a cautionary tale, Polygon's strong fundamentals and commitment to development could drive the token towards its bullish targets.