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Polygon price collapse amid record on-chain growth
Polygon (POL) has slid to fresh lows this month even as the network’s on-chain metrics spike following the activation of the Madhugiri hard fork. POL—rebranded from MATIC last year—fell to around $0.1200, a steep retreat from the September high of $0.2970. The decline has investors and analysts debating whether the token is oversold given the chain’s improving fundamentals.
What Madhugiri changed: faster blocks and higher throughput
The Madhugiri hard fork introduced several protocol-level upgrades, including a 33% increase in transaction speeds, a 1-second block consensus, and compatibility with Ethereum’s Fusaka upgrade. Those engineering improvements helped push daily activity to new highs.
On the day immediately after the upgrade, Polygon processed more than 8.1 million transactions, and Nansen data shows total transactions rose roughly 93% in the past 30 days to over 158 million. That growth positions Polygon as the second-fastest-growing chain in the period, behind Monad.
Active users, fees and tokenomics
Active addresses on Polygon jumped about 54% over 30 days to roughly 13 million. Fee revenue increased by about 27% to $778,000—an important metric because Polygon burns a portion of fees, which helps offset new POL issuance. Higher fees and sustained user growth can strengthen long-term tokenomics even while market prices fluctuate.
DeFi and ecosystem activity
Polymarket, a major prediction market built on Polygon, recorded $4.33 billion in volume in November—its biggest month ever. That on-chain demand and growing DeFi TVL provide tangible usage signals for Polygon’s ecosystem.
Is Polygon undervalued relative to peers?
Some market participants argue POL looks undervalued when compared with other layer-1s. One widely-circulated analysis compared Polygon and Sui, highlighting that Polygon has higher DeFi TVL (around $1.19 billion vs Sui’s $931 million), far larger stablecoin supply (approx. $2.825 billion vs $0.5 million), and stronger revenue, yet trades at a fraction of Sui’s market capitalization.
Technical outlook: falling wedge could signal a rebound
POL’s daily chart shows a clear downtrend from the September peak. The token broke below a key support level near $0.1520 and currently trades under major moving averages. Technical indicators remain bearish in the short term, but there is a silver lining: the price action has formed a falling wedge pattern, which historically can precede a reversal.
POL price chart
Key levels to watch
- Immediate resistance: $0.1520 (a level the token failed to hold several times)
- Near-term support: current range near $0.12
- Upside target if wedge breaks: retest of $0.1520 (~30% above current price)
Traders should weigh on-chain improvements—faster throughput, rising active addresses, growing fees, and expanding DeFi usage—against macro crypto sentiment and broader market pressure. A rising on-chain activity profile supports a bullish narrative for POL over the medium term, but price recovery will likely require renewed market confidence and buying momentum.
Bottom line
Polygon’s network fundamentals are strengthening after the Madhugiri hard fork: transactions, active addresses, and fee revenue are all climbing. Yet POL’s market price has dropped to multi-month lows, creating a debate about valuation fairness versus peers like Sui. For investors focused on blockchain utility, Polygon’s improving metrics are a bullish sign; for momentum traders, confirmation from price action and broader crypto market strength will be needed before calling a durable bottom.
Source: crypto
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