Do Large Polygon (MATIC) Holders Pose a Risk for a Market Downturn? – Insights from Data

Amid Ongoing Challenges: MATIC Faces Price Decline

In the dynamic landscape of cryptocurrency, the overall market is currently witnessing a decline in prices. Notably, Polygon (MATIC) has garnered significant attention as its value slipped below a crucial level.

MATIC Breaks Crucial Support Zone

Recent data from IntoTheBlock, an on-chain analytics firm, reveals that MATIC has experienced a notable price drop below a critical range of $0.84 to $0.86. This range is held by 14,240 addresses, collectively owning over 4.13 billion MATIC. If the Polygon price remains below this range, there is a growing risk that these holders might consider selling to prevent substantial losses. This concern has been echoed by a prominent trader and analyst, Ali on X (formerly Twitter).

The primary driver behind this price decline was the recent success of the Polygon Ecosystem Growth initiative, which distributed a significant 217 million MATIC tokens valued at approximately $198 million. These tokens were dispersed among 70 wallets. The decline was further influenced by the legal case against Binance’s ex-CEO CZ and the recent SEC lawsuit against the cryptocurrency exchange Kraken for securities law violations.

Current MATIC Status

As of now, MATIC is trading near $0.77, with minor upside movement observed in the last 24 hours. However, over the past 7 days, it has experienced a significant price decline of over 9%. Looking at the last 30 days, MATIC’s price has demonstrated a massive upward momentum of over 24%, surpassing major cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH), which have only experienced 10.5% and 17.5% growth, respectively, in the same period.

Data also indicates that the majority of MATIC tokens, around 81.5%, belong to holders who bought them at higher prices. Only 18% of MATIC holders have bought in the money.

Currently, MATIC is trading above its 200 Exponential Moving Average (EMA), which still supports MATIC staying above the next crucial zone, approximately $0.722. This is considered MATIC’s strong demand zone. According to technical analysis, breaching this level might lead to a potential price decline.