This week proved to be fruitful for most of the crypto market and a lot of altcoins even created records including MATIC, the token of the Polygon network. Along with the rising prices, the investors’ bullishness also rose and MATIC seemed to be enjoying the profits. But this move by certain investors might actually cause MATIC to scale back down its growth.
MATIC flipped many altcoins
The 41.83% rally that the altcoin registered this week, led to it flipping some major tokens on the top 20 list of cryptocurrencies. With a market capitalization of $13.37 billion, Polygon outperformed Bitcoin Cash, Litecoin, Algorand, and Binance USD stable coin to place itself at the 17th position.
Polygon has been pushing its boundaries on many fronts to make itself accessible to everyone using various methods. Conducting India’s first hackathon BUILDIT was one such effort. In fact, recently the company also invested in Asia’s largest NFT marketplace called Colexion in an effort to expand its reach to the Asian market. So apart from development, investment too has become a tool of their expansion.
But first, we need to discuss the move by investors that could scale back Polygon’s rise.
What did Polygon investors do?
Owing to the rally, most investors took this opportunity to cash in profits and we could see the results on-chain as well. As the rise began, investors began selling too, and in less than 10 days over 100 million MATIC worth almost $200 million was sold off.
Polygon exchange supply | Source: Santiment – AMBCrypto
A large part of these sellers were also Long-term holders (LTHs) who moved their holdings and in 3 days ended up consuming 26.9 billion days.
Polygon age consumed | Source: Santiment – AMBCrypto
Cashing out is not a bad idea when the market is not in strength, or when the market is observing a potential reversal. But cashing out when the asset is looking strong for a continued rise, can have an adverse effect.
As a result of this selling, today MATIC dropped by almost 8%. This can now be the reason for investors to suffer losses even though throughout the month of October MATIC holders have been seeing profits. In fact, owing to the strong performance, investors in profit rose from 44.16% to stand at 93.24% at the time of this report.
Polygon profitable addresses | Source: Intotheblock – AMBCrypto
Furthermore, the same rise also led to an increase in participation as active addresses and new addresses both witnessed a boom this week.
Thus, if investors would like to keep these stats up and not cause a reversal in the market cap’s rise it, would be best to HODL their MATIC.