Polygon crosses Ethereum in this metric: Will MATIC respond positively

Polygon’s NFT space witnessed growth over the last week, along with active users
Exchange reserves fell, but MATIC’s MVRV Ratio looked troublesome

Sandeep Nainwal, the co-founder of Polygon [MATIC], tweeted about the blockchain’s new achievement on 4 December. Polygon’s NFT ecosystem witnessed growth as Reddit minted over 250k “avatars” in a single day.

Wowww!! 250k NFTs minted on @Reddit – A new record!!!

Powered by @0xPolygon pic.twitter.com/yDabMLWBMD

— Sandeep | Polygon (@sandeepnailwal) December 4, 2022

Read Polygon’s [MATIC] Price Prediction 2023-2024

Polygon NFTs on fire

Reddit first broke its own record of the most avatars minted in one day when it witnessed 216k mints on 3 December. According to NFTGator, at press time, 3.65 million users held 4.3 million avatars. Interestingly, 3.4 million users owned a single avatar, while 234k holders collectively owned 920k avatars.

Santiment’s data further revealed that Polygon’s total NFT trade count and total NFT trade volume in USD also registered spikes over the last week. This was a development that could be considered as promising for the network.

Source: Santiment

Apart from the NFT ecosystem, Polygon’s daily active users also increased. Surprisingly, it even surpassed the king of altcoins, Ethereum [ETH]. As per Token Terminal, Polygon’s daily active users on Web3 were over 412k, second only to BNB Chain.

Daily active users in web3:

BNB Chain – 1.11m
Polygon – 412.43k
Ethereum – 364.84k
Arbitrum – 53.11k
Uniswap – 39.59k
OpenSea – 39.53k
Optimism – 31.96k
Avalanche – 26.86k
Blur – 8.34k
Lens – 5.62k
PoolTogether – 5.26k
Stargate – 3.86k

— Token Terminal (@tokenterminal) December 4, 2022

Interestingly, there were several other positive developments in Polygon’s ecosystem over the past few days. For instance, online marketplace Flipkart announced a strategic partnership with the network to enter into a Blockchain-eCommerce Center of Excellence (CoE).

This new partnership will reportedly focus on researching, developing, and launching Web3 and Metaverse use cases.

The day is here We are officially partnering with the leading Ethereum scaling protocol, @0xPolygon. https://t.co/f6nFEwp7nP

— Flipkart (@Flipkart) December 2, 2022

How does this impact MATIC?

MATIC’s price responded positively to these developments, as per data from CoinMarketCap, MATIC’s price increased by 13% over the past seven days. At press time, MATIC was trading at $0.9386 with a market capitalization of over $8.19 billion.

CryptoQuant’s stats suggested that MATIC’s exchange reserves were decreasing, which was a positive sign as it indicated less selling pressure. The token’s number of daily transactions and transfer volume also increased.

However, not everything was working in its favor. Santiment’s chart revealed that despite the price hike, MATIC’s Market Value to Realized Value (MVRV) Ratio declined over the last week, which was concerning. Additionally, after registering an increase, MATIC’s network growth went down on 4 December, indicating that the investors may have a reason to worry.