The Polygon price has remained under pressure this week as cryptocurrency prices have retreated. MATIC, its native token, is trading at $1.3745, which is about 23% below this week’s high of $1.800. This brings its total market capitalization to more than $8.95 billion.
MATIC under pressure
Polygon is the biggest layer-2 blockchain project whose goal is to increase the speed and efficiency of Ethereum platforms. This scaling is necessary because of the significant challenges that Ethereum faces. For one, it is one of the slowest network and its technology lacks scaling features.
Ethereum’s network has worsened as the number of activities in the network has risen. For example, the total value locked in Decentralized Finance (DeFi) has jumped to more than $90 billion. As a result, gas and transaction fees have risen while the speed of transactions has declined.
Therefore, the number of developers switching to Polygon has been on an upward trend. Some of the best-known developers building on Polygon are Neon District, Polymarket, Decentral Games, C.R.E.A.M Finance, Curve Finance, and Aave.
On Thursday, Polygon announced that it was working with Mina Protocol to implementing support for Mina on Polygon PoS. This integration will make it possible for developers building on Polygon to benefit from the privacy features of the Mina protocol. In a statement, the CEO of Mina said:
“Mina Foundation shares Polygon’s dream of a fully decentralized ecosystem of dapps empowering users with control over their own data privacy. We are very excited about the privacy-preserving and verifiable applications that will be launched on Polygon utilizing Mina Protocol.”
Despite the good news, the Polygon price has lagged in the past few weeks. And as a result, its ranking in cryptocurrencies has dropped from the top 15 to the current 23. This underperformance is mostly because of the ongoing strong performance by Ethereum-killers like Solana and Avalanche.
Polygon price prediction
The four-hour chart shows that the Polygon price tumbled from this week’s high of $1.788 to a low of $1.0982, which was the lowest level since August 10. The coin then made a strong rally but found a resistance at $1.5754. It is now trading slightly above the 38.2% Fibonacci retracement level. It is also slightly below the 25-day and 50-day exponential moving averages (EMA).
Notably, the coin seems to be forming a bearish flag pattern that is shown in black. Therefore, there is a high probability that the coin will bounce back lower as bears target the key support at $1.098.
