MATIC Advances 6.5% In Last 7 Days – Can It Sustain Gains For Another Week?

Christian Encila

2 years ago

4 mins read

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The year 2022 saw the value of Polygon’s native token MATIC drop by 64%. But the network started this year on a positive note, with the price shooting up 8% according to the charts. However, can MATIC maintain this momentum?

On-Chain Developments To Play A Big Role For MATIC

The Layer 2 ecosystem has been seeing on-chain developments grow. Just before the turn of the new year, Polygon’s first prediction market Bhavish Finance made several records that brought Polygon in the spotlight. Uniswap, a decentralized exchange in the ecosystem, ended 2022 with a $28 billion annual volume.

The DEX surprisingly accomplished that with a sub-$100 million TVL, but as of writing Uniswap’s TVL on Polygon is at $111.21 million, according to the DEX’s public dashboard.

Chart: Uniswap.org

These bullish developments, however, are preceded by big news on Polygon’s NFT arm. DeGods and y00ts, two of the biggest names on Solana, will bridge their collections on Polygon and Ethereum on Q1 of 2023.

This would inevitably bring interest on Polygon’s NFT market, pushing the price of MATIC upwards. However, with the nearing timeline of the ‘Shanghai’ network upgrade of Ethereum, Polygon’s main offering, which are low gas fees due to a better roll-up protocol, will be challenged.

With this in mind, it remains to be seen what developments on-chain would differentiate Polygon with Ethereum’s upgrade and other L2 protocols.

Crypto FUD Will Strengthen Bears Long-Term

The crypto market has definitely suffered from last year’s big collapses. But the FUD (fear, uncertainty and doubt) that came about these events might be strengthened as Huobi, a centralized exchange, seems to be melting down in real time.

Recent news shows that the CEX will be laying off 20% of its employees. Tweets about Huobi’s situation show that Justin Sun, the touted shadow owner of Huobi, has been converting billions of his crypto to fiat on Binance.

MATIC total market cap at $7 billion on the daily chart | Chart: TradingView.com

The exchange itself is also observed to have increased withdrawals in the past couple of days. This led to some speculation that the exchange could be the next FTX. Any negative development here would affect Polygon as insolvency news hit the crypto markets particularly hard.

🟡 What could happen to Huobi?

– Huobi has $80m(4%) outflow in the past 24H, and $133m(7%) in 7D VS their $2B clean assets
– Could halt withdrawals and activities if situation gets out of proportion
– Risk-averse thing to do right now is to withdraw and self-custody

5/ pic.twitter.com/osCCyCzpGa

— Rock 🪨 (@DataaRocks) January 6, 2023

Short- to mid-term however, MATIC has some room to grow as the current support at $0.7538 proves to be a barrier for the bears.

Previous bullish on-chain developments also help investor sentiment to remain positive. But with the token’s strong correlation with ETH, negative macros could pull the king of altcoins down along with MATIC.

Investors and traders should target $0.8106 price resistance to continue the bullishness of MATIC.

-Featured Image: The Daily Hodl

Christian Encila

They say journalists never truly clock out. But for Christian, that's not just a metaphor, it's a lifestyle. By day, he navigates the ever-shifting tides of the cryptocurrency market, wielding words like a seasoned editor and crafting articles that decipher the jargon for the masses. When the PC goes on hibernate mode, however, his pursuits take a more mechanical (and sometimes philosophical) turn.

Christian's journey with the written word began long before the age of Bitcoin. In the hallowed halls of academia, he honed his craft as a feature writer for his college paper. This early love for storytelling paved the way for a successful stint as an editor at a data engineering firm, where his first-month essay win funded a months-long supply of doggie and kitty treats – a testament to his dedication to his furry companions (more on that later).

Christian then roamed the world of journalism, working at newspapers in Canada and even South Korea. He finally settled down at a local news giant in his hometown in the Philippines for a decade, becoming a total news junkie. But then, something new caught his eye: cryptocurrency. It was like a treasure hunt mixed with storytelling - right up his alley!

So, he landed a killer gig at NewsBTC, where he's one of the go-to guys for all things crypto. He breaks down this confusing stuff into bite-sized pieces, making it easy for anyone to understand (he salutes his management team for teaching him this skill).

Think Christian's all work and no play? Not a chance! When he's not at his computer, you'll find him indulging his passion for motorbikes. A true gearhead, Christian loves tinkering with his bike and savoring the joy of the open road on his 320-cc Yamaha R3. Once a speed demon who hit 120mph (a feat he vowed never to repeat), he now prefers leisurely rides along the coast, enjoying the wind in his thinning hair.

Speaking of chill, Christian's got a crew of furry friends waiting for him at home. Two cats and a dog. He swears cats are way smarter than dogs (sorry, Grizzly), but he adores them all anyway. Apparently, watching his pets just chillin’ helps him analyze and write meticulously formatted articles even better.

Here's the thing about this guy: He works a lot, but he keeps himself fueled by enough coffee to make it through the day - and some seriously delicious (Filipino) food. He says a delectable meal is the secret ingredient to a killer article. And after a long day of crypto crusading, he unwinds with some rum (mixed with milk) while watching slapstick movies.

Looking ahead, Christian sees a bright future with NewsBTC. He says he sees himself privileged to be part of an awesome organization, sharing his expertise and passion with a community he values, and fellow editors - and bosses - he deeply respects.

So, the next time you tread into the world of cryptocurrency, remember the man behind the words – the crypto crusader, the grease monkey, and the feline philosopher, all rolled into one.

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