Key Takeaways
- Polygon (POL) price drops to $0.1915—down 32% in a month—amid fierce competition from Base, Arbitrum, and Unichain, with TVL lagging rivals.
- Polygon network activity remains strong, with a 33% rise in transactions and a 23% increase in active addresses despite recent bearish sentiment.
Polygon (POL) continues its downward spiral, hitting a fresh low of $0.1915—the weakest level since April 21—as broader crypto market sell-offs intensify. The token is now down 32% from its May highs and 74% below its 2024 peak, with Polygon’s market cap shrinking from $5.68 billion to just $2 billion.
Layer-2 Sector Heats Up, POL Lags Behind Rivals
Polygon’s sharp decline underscores its struggle to keep pace in the increasingly crowded layer-2 ecosystem. The network currently holds a total value locked (TVL) of $1.17 billion and a stablecoin supply of $2.3 billion—figures that pale in comparison to key competitors.
Base, the Coinbase-backed layer-2 solution launched in 2023, has surged to $5.14 billion in TVL and boasts $4.16 billion in stablecoins. Arbitrum, another major player, holds over $3 billion in assets and $3.5 billion in stablecoins.
Uniswap’s recently launched Unichain is also making waves. Since debuting in March, it has already amassed $1.12 billion in assets and $316 million in stablecoins, highlighting the fierce competition Polygon faces.
Polygon zkEVM Shutdown Adds to Bearish Sentiment
Polygon’s woes deepened following the high-profile shutdown of its zkEVM network. Originally acquired as Hermes for $250 million, the project failed to deliver on its ambitious technical roadmap. CEO Marc Boiron cited delayed execution, poor product-market fit, and overambitious goals as reasons for shelving zkEVM—a blow that rattled investor confidence.
Network Activity Shows a Silver Lining
Despite price pressures, Polygon’s underlying network activity shows encouraging signs. According to Nansen, transactions on Polygon have climbed 33% over the past 30 days to 85.6 million, while active addresses have jumped 23% to 6.49 million.
In fact, Polygon is outperforming even Ethereum in this metric. Ethereum’s active addresses rose by 5.5%, while total transactions reached 34 million over the same period.
On the technical front, POL remains firmly bearish. The token peaked at $0.7672 in December but has since plunged below the key 23.6% Fibonacci retracement level of $0.2950.
The price is also trading under its 50-day moving average, with both the MACD and Relative Strength Index continuing to decline—signaling potential further downside.
Also Read: How to Use the Polygon Bridge: A Step-by-Step Guide to Bridging Tokens Across Chains
Analysts warn that if selling pressure persists, POL could test the year-to-date low of $0.1487, about 26% below current levels. However, a breakout above the 50% retracement level of $0.2195 would help invalidate this bearish scenario.
Polygon faces mounting challenges as competition heats up in the layer-2 space. While network activity remains strong, the combination of technical weakness and strategic missteps—such as the zkEVM shutdown—suggests more volatility ahead for POL investors.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses
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