The development team at Polygon has recently announced a significant upgrade that introduces a new token known as Polygon POL. This upgrade represents a technical enhancement of the native asset of the Polygon network.
Polygon POL: A Vision for Growth
Described as the next generation protocol token, Polygon POL is designed to play a crucial role in coordinating and expanding the Polygon ecosystem. It is positioned as a driving force behind the vision of the Value Layer for the Internet.
According to Naiwal, POL serves as a protocol that enables users to benefit from multi-chain staking while mitigating the risks associated with restaking. The Polygon 2.0 proposal outlines the expansion of the Polygon Ecosystem from a single chain to an ecosystem of Layer 2 solutions that can seamlessly interoperate and share liquidity.
POL’s design aims to eliminate the reliance on trusted third parties, enhancing decentralization and minimizing vectors of centralization. The token adheres to a third-generation token standard, signifying its innovative approach.
POL’s Impact on MATIC Price
The introduction of POL brings significant implications for the MATIC price.
MATIC Price Movement
MATIC price has experienced a resurgence, recovering from the sell-off that drove it down from July’s highs of $0.902 to its current support at $0.525.
Traders are displaying an inclination to engage in MATIC long positions, as the Moving Average Convergence Divergence (MACD) indicator prepares to signal a potential buy.
In this context, traders are observing the potential crossover of the MACD line (blue) below the signal line (red). The overall uptrend of the momentum indicator toward the mean line (0.00) and subsequently into the positive territory indicates the potential for a significant trend reversal.
Strategies for Traders
Prior to initiating buy orders, traders are advised to await confirmation of MATIC’s support at $0.55. The initial profit target is set at $0.65, aligning with the 50-day Exponential Moving Average (EMA) (red).
A crucial milestone signaling the start of a substantial uptrend would involve a breakout above the descending trendline spanning several months. Such a breakout would coincide with a surge in trading volume and a sharp ascent, possibly reaching 61.8% – measured from the support established in June at $0.516 to $1.2.
The forthcoming release of POL, even during its development phase, could serve as a catalyst for such a movement, particularly if the crypto market structure weakens further or fails to show improvement. Concerns about potential interest rate hikes by the US Federal Reserve in September are already emerging. Investors in assets like BTC and cryptocurrencies are hoping for a reprieve from the stringent monetary policies to foster market stability.