As the cryptocurrency market experiences a significant price correction, Polygon (MATIC), a framework for building and connecting ethereum-compatible blockchain networks, is the only top non-stablecoin asset making sustained gains among the top 100 digital assets tracked by CoinMarketCap.
MATIC’s seven-day performance trades in the green zone having surged 55.4% as of May 19. Currently, the asset is trading at $1.82 with a market capitalization of above $10 billion.
Elsewhere, among the biggest losers for the last seven days, Internet Computers and SHIBA INU tops the list, plunging 65.86% and 67.66%, respectively.
Why Polygon is rising in value
The ability by Polygon to sustain gains stems from the increased activity on the asset’s network with real-world utilization alongside growing interest from the crypto community. For instance, the government of Maharashtra state in India currently deploys the Polygon blockchain to track COVID-19 cases, despite the country planning to outlaw digital assets.
Furthermore, Polygon seeks to ease challenges associated with ethereum, like high fees for powering transactions. As a layer two scaling project, Polygon can now be utilized among decentralized finance (DeFi) protocols to bypass ethereum’s high transaction costs. Therefore, the demand for such scaling solution is attracting capital inflows into Polygon.
As the DeFi industry continues to spike in value, Polygon is already registering interest, having signed a partnership with YFDAI Finance. The partnership will see Polygon help the DeFi protocol reduce transaction gas fees to enhance scalability, interoperability, and user experience.
Polygon’s recent gains come on the heels of bitcoin plunging almost 40% over the last seven days after electric vehicle manufacturer Tesla suspended using the asset in payments. As a result, CEO Elon Musk noted that the company is looking for an alternative asset that is energy efficient.
Polygon has therefore benefitted from speculation as a possible candidate to replace bitcoin on the Tesla ecosystem.