Polygon (MATIC) Price May Reverse Despite Bearish Market as On-Chain Activity Spikes

Polygon has recorded a notable increase in on-chain activity despite the bearish flip in crypto that has sent MATIC plummeting.

Crypto analytics platform Santiment says that Polygon (MATIC) is seeing increased on-chain activity, which could indicate a potential price reversal for the asset.

According to Santiment, both daily active addresses and dormant coins movement have spiked on the Polygon network.

The platform highlights the Age Consumed metric, an indicator that tracks the movement of dormant tokens by measuring how many long-held coins are moving across addresses.

Santiment notes that the Age Consumed data is a calculation that multiplies the number of coins on the move by the duration since their last transfer.

“We define this metric as the total days multiplied by the number of coins moved on a given day, to show the ‘coin-age’ being moved around the network. This metric can show us how frequently coins are moving, and whether older coins (those HODLed for longer) are being shifted.”

Also notable is the sharp increase in daily active addresses. According to Santiment’s data, a total of 3,369 addresses interacted on-chain on Polygon as the Age Consumed metric spiked.

The active addresses count marked the second-highest day of the year.

IntoTheBlock data also shows a surge in active addresses since August 26th, with more than 1,000 new addresses on August 27th.

What does this mean?

An increase in the Age Consumed metric often suggests a flip in sentiment for long-term holders.

Historically, this has coincided with the particular token’s price witnessing notable changes.

Polygon has been among the many networks to decline since crypto’s retrace began back in March. However, a notable spike in on-chain activity may be a sign that a MATIC reversal may be brewing soon.

Active addresses and dormant coin spikes are common signals preceding this.

As Santiment notes on its website,

“Generally, spikes in activity for coins that have been HODLed for a long time (e.g., over a year) tend to coincide with price pivots.”

In Polygon’s case, the Age Consumed measure spiked to 69 billion MATIC as the altcoin’s price dropped amid the latest crypto weakness.

The local top relating to this was around $0.58, and Polygon’s price has dropped 14% so far.

Despite this weakness, the two on-chain indicators suggest investors may be viewing MATIC’s dip as an opportunity to buy low.

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