The post Is Polygon overvalued? What you should know as dApp volumes plunge 41% appeared on BitcoinEthereumNews.com.

Polygon’s NVT ratio has risen in the last two days, suggesting a lack of strong network activity to support an uptrend.  Polygon’s 30-day dApp volumes have also dropped by 41% as bearish trends persisted. Polygon [POL] has been under bearish trends after recording a 9% drop in seven days. At press time, POL traded at a crucial support of $0.43, with a breach of this level set to exert further downward pressure.  Much of this downtrend stems from rising selling activity. However, reduced network usage is also impeding Polygon’s attempt to recover.  Polygon’s NVT rises as network activity falls  The Network Value to Transaction (NVT) ratio has risen from 27.66 to 86.44 in the last two days. This rise suggests that POL could be overvalued due to declining blockchain activity.  Source: IntoTheBlock This NVT also shows that despite the recent downtrend, POL was still poised for further dips due to a lack of users on the network to drive a price recovery.  Data from DappRadar shows that in the last 30 days, dApp volumes on the network have declined by 41% to $6.16 billion. At the same time, the Unique Active Wallets have dropped by 22% to 3.62 million.  On the decentralized finance (DeFi) front, the Polygon network was also experiencing reduced activity, with the Total Value Locked (TVL) sitting at a weekly low of $1.03 billion per DeFiLlama. Daily revenues on the blockchain had also dropped to $6,860. This reduced network activity could continue to impact POL’s ability to recover from bearish trends.  POL price analysis  Polygon traded within a descending triangle pattern on its lower timeframe, confirming a bearish bias and a continuation of the downtrend. The lower trendline of this pattern stood at $0.43, a level that POL was testing at press time. Source: TradingView If this support…

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Filed under: News - @ January 23, 2025 10:15 pm