Polygon (MATIC) Surpasses Bitcoin in User Growth
According to a recent industry report from Flipside Analytics, Polygon (MATIC) experienced a remarkable 50% increase in user growth compared to Bitcoin (BTC) in 2023.
Despite the tepid performance of MATIC prices in recent months, the report suggests that the substantial user growth could have a significant impact on MATIC prices in 2024. While other mega-cap altcoins saw triple-digit gains in Q4 2023, MATIC struggled to reach a new yearly peak.
Markets have been cautious about Polygon’s proposed transition to a new ‘POL’ native token, announced in July 2023.
Key Findings from Flipside Analytics
Flipside Analytics’ on-chain report highlights fundamental growth signals for Polygon that could positively influence MATIC price action in 2024. The report reveals that Polygon attracted 15.2 million new user addresses in 2023, surpassing Bitcoin and claiming the top spot behind Ethereum.
- The acquired user count serves as a proxy for measuring global adoption rate and user acquisition.
- Polygon’s 15.2 million new users were 50% higher than Bitcoin’s 10.6 million acquired users for 2023.
- Arbitrum (ARB), Optimism (OP), and Base also made the top 8 list of best-performing projects in user growth.
This data indicates that Layer-2 scaling projects, including Polygon, are among the fastest-growing sectors in the crypto space.
Polygon’s Impact on Market Demand
The significant increase in new user count suggests that the Polygon network is attracting participants at a higher rate than Bitcoin and its Layer-2 competitors. This could lead to increased market demand for the MATIC (POL) token if sustained over time.
Polygon’s Unusually High Transactions from New Users
As the 15.2 million new Polygon network participants begin to utilize MATIC in daily transactions, the organic growth in market demand could positively impact prices in the long run.
IntoTheBlock’s ‘new adoption rate’ metric reveals that, on average, 37% of Polygon (MATIC) daily transactions in the past month were from new wallets transacting for the first time. This further supports the statistics presented in the Flipside Analytics report.
Prospects for MATIC Price in 2024
Despite concerns about the redundancy of Polygon’s network scaling solutions following Ethereum’s PoS transition in 2023, the uptrend in fundamental growth metrics signals long-term viability. Key network upgrades and strategic partnerships, such as the transition from MATIC to a more decentralized POL token and the partnership with Chainlink, could deepen Polygon’s adoption in 2024.
The partnership with Chainlink allows developers on Polygon zkEVM to integrate off-chain price feeds into Polygon dApps, potentially powering decentralized exchanges, liquidity protocols, and Real World Assets (RWA) projects on the Polygon chain.
Summary
In summary, the user growth surpassing Bitcoin and its Layer-2 competitors, along with the rising number of new-user transactions, are critical factors that could propel MATIC prices upward. Ongoing token upgrades and strategic partnerships focusing on the RWA narrative may further intensify Polygon network growth, leading to positive price action in the months ahead.
MATIC Short-Term Price Prediction: $0.8 Resistance Looms Large
Based on Polygon’s user growth, token upgrades, and strategic partnerships, MATIC appears poised for positive price movement in 2024. However, in terms of short-term price action, MATIC is currently trading at $0.73 as of Jan 25, facing resistance at $0.80.
IntoTheBlock’s global in/out of the money around price data reveals that 62,240 wallets acquired 5.6 billion MATIC at an average price of $0.80, forming the largest cluster of current Polygon token holders. Breaking above $0.80 could open the doors to a retest of the $1 area.
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