Whale Accumulations Indicate Caution for Polygon
Accumulations on the Arbitrum side in the past few months may indicate that other Ethereum Layer 2 (L2) solutions like Polygon (MATIC) need to be cautious. Following recent token unlocks, the extent of ARB investors’ purchases was revealed. Despite a slowdown at one point, another significant buying event emerged on May 17.
According to data shared by Arbiscan, a whale purchased 4.17 million ARB on this date. This same whale has accumulated a total of $6.15 million worth of ARB since July 2023.
Arbitrum vs. Polygon: Which Has the Upper Hand?
Whale purchases of this magnitude generally indicate long-term confidence in the token’s performance. Such activity is rarely seen on the Polygon side. However, examining MATIC’s price performance, it experienced a Year-to-Date (YTD) loss of 29.23%, while ARB saw a 40.86% drop, performing worse.
Despite this, the consistency of accumulation on the ARB side could alter the dynamics. Continued accumulation activities could result in Polygon falling behind Arbitrum. The growth of both cryptocurrencies holds significant implications for their future standings.
Network Growth: Arbitrum Leads
A critical metric in this context is the number of new addresses transacting on the network. As of the time of writing, Arbitrum’s network growth indicated 1,526 new addresses. On the Polygon side, the number was only 225. This substantial difference highlights ARB’s preference among market participants.
If this trend continues, there could be a noticeable increase in ARB’s price. Furthermore, ARB managed to surpass the critical $1 level again, suggesting potential for further growth.
Can Arbitrum’s Market Cap Triple?
ARB bulls have struggled for months to reclaim lost ground after a sharp decline. While the price may advance beyond current levels, reaching the all-time high of $2.39 seen in March remains challenging.
Despite emerging potential on the Arbitrum side, it may struggle to reach the market cap that Polygon already has. As of now, Arbitrum’s market cap is $2.72 billion, while Polygon’s stands at a significant $7.12 billion. For ARB to match this level, its price would need to exceed $3.50, assuming MATIC remains below $1.
