Overall, the final quarter of 2021 was relatively upbeat. With coins like Solana, Terra (LUNA) and MATIC exhibiting independent price actions that are not strongly influenced by BTC trends, the rise of layer 1 protocols is remarkable.
Polygon’s native token MATIC hit a new all-time high (ATH) of $2.9 on December 26, MATIC’s recent price increase is not due to overall market volatility, but to increased interest in this network.
MATIC fly high
Driven by sustained network growth and highly active addresses, the price of MATIC recently broke its ATH and has been in a larger uptrend since Dec 15.
High address activity has continued to show growing interest in the Matic Network, with over 8,000 daily active addresses making MATIC one of the top 5 most active and used coins.
The distribution of HODLers by concentration has shown that more than 75% of Matic is owned by whales. Whales between 1 million and 10 million have comfortably accumulated until the recent rally while smaller whales also show some accumulation patterns.
MATIC exchange balance has dropped as more MATICs leave exchanges amid positive sentiment.
That is said to be the general increase in the number of transactions, the large volume of transactions has highlighted the growing interest of large institutions in this project.
On fundamentals, MATIC looks to be having a nice rally but what does its rise say about the market?
The recent MATIC bull run has seen an independent rally in altcoins as correlation with BTC hits all-time lows.
Previously, the same was discovered in Solana and Terra (LUNA) as the correlation of these two assets with BTC was also low at the time.
MATIC’s profitability is indicative of the growth of L-1 protocols as analysts noted a spike in capital inflows to networks like Polygon, Solana, and Terra last month.
MATIC has been in price discovery mode, just like Terra and Solana in their previous rallies.
As institutional and retail interest in L-1s skyrocketed over the last year, their total locked-in value has also seen significant growth. So it looks like L-1 is poised for growth in 2022, as long as network growth and on-chain activity is maintained.