is Polygon set for new highs?


Matic Network, now Polygon, the framework aimed to enhance interoperability between the Ethereum blockchain and compatible networks, has experienced big price swings since the end of April 2021. MATIC, Polygon’s native token, spiked around 760% in a four-week long surge, rising from $0.31 on 20 April 2021 to an all time-high of 2.68 on 18 May 2021.

Following its record high, MATIC plunged to $0.89 on 23 May, but immediately skyrocketed on 26 May 2021, reaching $2.27. The token’s price gradually descended to $0.62 by 20 July 2021. 

The recent price surge, and its latest breakout through the major resistance level of $1.51, was triggered by Polygon (MATIC) news about the creation of a decentralised autonomous organisation (DAO). According to Polygon, the system aims to form committees, promoting discussion between projects like Sushi, Aave, QuickSwap and others to “bring DeFi to the next million users”.

A non-mineable token, MATIC, currently trading around $1.63, with a market capitalisation of $10.5bn (£7.6bn; €8.9bn), ranking it 17th in the global cryptocurrency rating

Is Matic Network a good investment option? Follow our detailed Polygon price prediction to help you decide whether it deserves a place in your investment portfolio.

What is Polygon crypto?

Formerly referred to as Matic Network (it was rebranded in February 2021), Polygon is a layer-2 network developed to add additional scalability to Ethereum and improve interoperability between its blockchains. 

Polygon describes itself as “Ethereum’s internet of blockchains” – an easy-to-use platform for Ethereum scaling and infrastructure development.

Polygon strives to solve some of Ethereum’s major drawbacks, including poor user experience (delayed transactions), insufficient throughput and lack of community governance, with a new sidechain solution.

Polygon

The platform’s core element is Polygon SDK, a flexible modular framework that contributes to the creation of numerous types of applications. With the use of Plasma side chains (designed to facilitate off-chain transactions, making them fast and cost-effective for blockchains), Matic Network built an environment that enabled cheaper, easier and the faster launch of decentralised applications (dApps). The Matic solution was backed by high gas fees on Ethereum and increased demand in the development of dApps.

Polygon has created a layer-2 network for developing Ethereum-compatible and interoperable blockchain networks. Its modular framework enables builders to create sovereign blockchains with customisable functionality. 

The platform boasts scalable consensus algorithms, modular “security-as-a-service” features and a bespoke WASM execution environment. It means Polygon is capable of creating enterprise-ready blockchain networks and delivering cost-efficient and fast transactions.

What are layer-2 solutions?

When we talk about blockchain scaling solutions, they are usually split into two levels: layer-1 and layer-2 solutions. Layer-1 refers to scaling functions within the blockchain itself by means of novel consensus algorithms and increasing block limits. Layer-2 scaling solutions refer to off-chain solutions. They remove elements of computational power from the main blockchain, before being executed on side-chains. This helps to increase throughput on the main chain. 

Layer-2 solutions, including Polygon, have been gaining popularity and are considered critical to the mass adoption of cryptocurrencies.

What are layer-2 solutions

Polygon architecture

Polygon architecture consists of four distinguished layers, each responsible for a range of functions and services used for several purposes.

The Ethereum layer is represented by a set of smart contracts implemented on the Ethereum network. They can handle staking, transaction finality and communicating between various Polygon chains and Ethereum.

The security layer runs alongside Ethereum. It delivers a “validators-as-a-service” role, providing chains with an additional layer of security.

The networks layer serves as a blockchain networks ecosystem developed on Polygon. Each has its own community and handles producing blocks and local consensus.

The execution layer is represented by Polygon’s Ethereum Virtual Machine implementation (EVM) applied to executing smart contracts.

Polygon architecture

Polygon chains can communicate both with the main chain of Ethereum and with one another due to Polygon’s arbitrary message passing functionality. It helps to spur a bunch of new use cases, including interoperable dApps and exchange of value between various platforms.

What makes Polygon special?

Polygon aims to improve blockchain scaling and interoperability. There are several major features that have contributed to the platform’s popularity and positive analysts’ outlook. 

  1. Polygon is compatible with EVM, which makes it useful for those who develop apps on Ethereum and program in Solidity.

  2. Polygon’s security model is optional – there’s no need to sacrifice flexibility for the sake of additional security if not needed. 

  3. Polygon claims to be flexible enough to incorporate different scalability solutions beyond Plasma chains, including Optimistic rollups and ZK-rollups.

Polygon (MATIC) technical analysis

MATIC tokens are used for various purposes in the Polygon ecosystem, including paying gas fees and contributing to security through staking. MATIC has been one of the top 20 most liquid and largest cryptocurrencies by market capitalisation (as of 23 August 2021). 

Speculating on the MATIC coin forecast, it’s worth mentioning that the race for the first and foremost interoperability solution is underway. Polygon’s rivals, Polkadot and Cosmos’ Stargate, are also moving to launch their solutions. 

MATIC has been one of the most promising cryptocurrencies this year. Since the start of 2021, the price has ballooned from $0.01 on 1 January 2021 to its current level of $1.63 (23 August). This increase of almost 16,300% seems to support the argument for a bullish MATIC coin price prediction.

MATIC to US Dollar – MATIC/USD CFD

But will the positivity last and be enough for MATIC to maintain a bullish position in what’s left of 2021 and beyond? Considering the short to mid-term Polygon (MATIC) Network price prediction for this year, traders should watch out for several support and resistance levels.

The first notable resistance level is at $1.76, followed by $1.94 and $2.64. On the downside, the cryptocurrency needs to hold the support level at $1.51 (a former resistance level), $1.29 formed by the 20-day moving average (MA) and the next one at $1.08 (a 50-day MA). 

A relative strength index (RSI) of 71 indicates a fairly strong bullish trend. However, reaching the overbought territory, a reversal is possible.

MATIC/USD price chart

MATIC price prediction: analyst sentiment

Commenting on the Polygon Network’s prospects, Capital.com’s analyst Mikhail Karkhalev said:

“Scalability is a major problem with most of the top cryptocurrencies, especially bitcoin (BTC) and ethereum (ETH). Most likely, the first founders of digital currencies had no idea that their creations would become so popular that they could barely handle the load on the network. That is why any working solutions that reduce the load on the network, and at the same time increase the speed of transactions and reduce their cost, are highly appreciated and welcomed by the community. Polygon (formerly Matic Network) is designed to solve this issue, which is why it is so popular. As long as the scalability problem exists, the Polygon project will be very relevant and in demand. The only tangible risk to the project is Ethereum 2.0, which should solve the scalability problem and, in a sense, render Polygon irrelevant.

“However, the transition to Ethereum 2.0 is quite a long process and will not solve all the problems at once. In addition, the founders of Polygon have set themselves the very ambitious goal of making the project literally the internet of blockchains, allowing them to interact with each other. Similar projects already exist, like cosmos (ATOM) or polkadot (DOT), but so far such solutions have no real use and are far from perfect. When investing in a startup, it’s important to remember that ambitious plans don’t mean the project will actually accomplish its goals and become a leader in its field. Polygon is a promising project, but it is important for investors to keep an eye on how the team achieves its goals”.

Polygon price prediction 2021, 2022, 2023, 2024, 2025, 2026

Several algorithm-based forecasting services share bullish views on MATIC price forecasts for the rest of the year and beyond. Don’t forget that any price prediction can be wrong and you should do your own research before making any trade.

According to Digital Coin, MATIC could be a profitable investment in the coming years. Its price targets suggest that MATIC could reach $2.37 in 2021, $5.79 in 2026 and $7.32 in 2028.

Another analytical source, Wallet Investor, gives a $4.33 median price target for the next 12 months. It thinks MATIC is an “awesome” long-term investment. According to their price forecast, the crypo’s price will rise to $15.49 by 2026.

MATIC price prediction 2021-2026

CoinPedia suggests the MATIC to USD forecast may hit $3 by the end of 2021. But if the project fails to attract more investors’ attention, it could plunge to a low of $0.72.

Please note that the above forecasts are generated with the help of deep learning technologies and technical analysis data. You should not base your own investment decisions on them. Remember that past performance does not promise future returns. Moreover, you should never invest funds that you cannot afford to lose.

We kindly ask traders to create their own trading strategy, considering personal risk tolerance and investing goals. We suggest conducting thorough research before every trade, taking into account both fundamentals and technical analysis, expert opinion and the latest crypto market trends. 

Capital.com allows you to speculate on various cryptocurrency markets without needing to own the underlying asset. Learn the benefits and risks of trading cryptocurrencies with contracts for difference (CFDs) in our comprehensive guide and choose from the list of top-traded cryptocurrency projects

MATIC price prediction for tomorrow, and next weeks

Date Price Min Price Max Price
2021-09-25 $ 1,182 $ 1,063 $ 1,293
2021-09-26 $ 1,198 $ 1,071 $ 1,323
2021-09-27 $ 1,122 $ 1,006 $ 1,239
2021-09-28 $ 1,062 $ 0,941 $ 1,177
2021-09-29 $ 1,053 $ 0,933 $ 1,160
2021-09-30 $ 1,097 $ 0,983 $ 1,207
2021-10-01 $ 1,064 $ 0,938 $ 1,184
2021-10-02 $ 1,115 $ 1,004 $ 1,236
2021-10-03 $ 1,130 $ 1,015 $ 1,247
2021-10-04 $ 1,055 $ 0,935 $ 1,174
2021-10-05 $ 0,995 $ 0,876 $ 1,117
2021-10-06 $ 0,987 $ 0,870 $ 1,109
2021-10-07 $ 1,031 $ 0,913 $ 1,145
2021-10-08 $ 0,998 $ 0,867 $ 1,119

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Read more: Keep Network price prediction: adding privacy to public blockchains

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Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.





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