The Polygon MATIC price is loitering near its lowest level this year as cryptocurrencies move into a consolidation mode. The coin’s price is trading at $0.6700, which is slightly above this month’s high of $0.4784. However, this price is about 77% below the highest level in 2021, bringing its total market cap at over $4.7 billion.
Is Polygon a good investment?
Polygon is the biggest layer-2 blockchain that has been around for a while. The platform’s goal is to help developers build and accelerate their Ethereum applications. It solves this by processing these transactions separately from Ethereum’s chain. In the past few years, the number of developers using Polygon has been rising. Some of the top dApps that use Polygon are Ox, AAVE, Algebra, Bancor Network, and Balancer, among others. In total, there are over 19k dApps built using Polygon.
Polygon has been expanding its ecosystem. Last week, the developers launched Polygon Nightfall Mainnet, which is a decentralized private transaction for enterprises. The solution solves two challenges: lack of complete privacy and anonymity and higher costs on Ethereum.
The benefits of this product are boosted credibility, confidentiality, and efficiency. Polygon also recently launched Polygon Supernets, which the $100 million ecosystem fund will help. Polygon has also been embraced by companies like Instagram, Stripe, and Adidas.
While Polygon has been doing well, the biggest challenge is that the decentralized industry has been facing headwinds. For one, the crash of Terra ecosystem has led to rising fears that key parts of the DeFi industry could be at risk.
Polygon MATIC price prediction
The daily chart shows that the MATIC price has been in a strong bearish trend. It managed to move below the lower side of the descending triangle pattern that is shown in black on April 28th. In most times, descending triangle is usually a bearish sign. The coin has moved below the moving average ribbon shown in yellow and orange.
At the same time, Polygon has formed a bearish pennant pattern. Therefore, there is a likelihood that the coin’s price will have a bearish breakout this week. If this happens, the next key support level to watch is at $0.45. The stop-loss for this trade is at $0.74.