Polygon (MATIC) Shows Signs of Life as Dormant Token Transactions Spike, Preparing for MATIC to POL Migration

Polygon's native token, MATIC, has lost over 17% of its value in the past month alone as it traded mostly below $0.52.

Polygon’s (MATIC) network activity has been dwindling ever since the broader crypto market began retracing in March.

However, recent data shared by crypto analytics platform Santiment suggests that this trend may be shifting.

Could Bullishness Be Returning for Polygon (MATIC)?

Polygon’s native token, MATIC, has dropped by over 17% in the last month alone as it trades mostly below the $0.52 mark. Further declines brought the asset to press time prices of $0.43, which could be a good entry point for buyers looking to acquire the token at a lower valuation.

In its latest post on X, Santiment noted that there was a significant increase in dormant token transactions on August 28th, which also saw the second-highest number of Polygon addresses interacting with the network this year.

A total of 3,369 addresses interacted on-chain with Polygon as the Age Consumed metric spiked to 69 billion MATIC on the same day. Both of these metrics are typically known to precede market reversals.

Hence, these signals indicate that MATIC could be preparing for a recovery, which may mark the beginning of a bullish period for the network as it recovers from its extended downtrend.

The Migration: MATIC to POL

The Polygon ecosystem is preparing for the official switch from MATIC to the POL token, which is set to take place on September 4 this year. This upgrade will see POL become the native gas and staking token for Polygon’s Proof of Stake (PoS) chain, and is an important milestone in the Polygon 2.0 roadmap that was unveiled last year.

The POL upgrade was initially launched on the testnet on July 17 to ensure a smooth transition. This phase was mainly focused on detecting and resolving any potential issues, and also allowed users and developers to familiarize themselves with the new system ahead of the mainnet upgrade.

MATIC holders on the Polygon PoS chain will be automatically converted to POL without any action required on their part. However, MATIC holders on Ethereum, Polygon zkEVM, or centralized exchanges will need to carry out the upgrade manually through a migration contract on Ethereum, as reported earlier.

This week, Binance announced that it will be supporting the upcoming transition.

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