Polygon zkEVM Mainnet Beta Address Count Grows +350% Since June, MATIC Price Still Lags Behind

Key takeaways

• The beta version of Polygon’s zkEVM Mainnet has seen rapid adoption in recent months
• MATIC continues to underperform the markets, Polygon revealed that a new native token will perform the same functions as MATIC in the Polygon 2.0 ecosystem
• CoinCodex algorithm expects a short-lived 30% jump for MATIC over the coming month

Polygon 2.0 takes shape as zkEVM Mainnet Beta attracts a growing user base

The Polygon (MATIC) blockchain is in the midst of a major upheaval as the project plans to migrate all operations to zero-knowledge tech. The move, dubbed Polygon 2.0, will involve the launch of a new Ethereum scaling solution that replaces Polygon’s EVM-compatible commit chain with an EVM-equivalent blockchain that uses zk-proofs.

The distinction between EVM compatibility and EVM equivalence is important for Polygon 2.0. Polygon has historically run smart contracts with Ethereum Virtual Machine, but the new zkEVM blockchain uses a different tech stack to introduce unlimited scalability while still enabling developers to launch Ethereum applications on Polygon with few, if any, changes to the code base.

Polygon #zkEVM hit a milestone: 1 million transactions

Not long ago, an EVM-equivalent ZK rollup was considered too expensive to be practical.

Today, Polygon zkEVM is one of the most affordable and usable L2s.

“Unconstrained scalability for mankind.”
–@VitalikButerin pic.twitter.com/lKC3ebshgn

— Polygon (Labs) (@0xPolygonLabs) June 14, 2023

After launching the beta version of zkEVM Mainnet in March, the network has seen a steady rise in adoption from developers and users alike. By June, the network had successfully processed more than 1 million transactions. By August, the protocol had processed more than 600,000 ZK proofs.

At the time of writing, there have been more than 400,000 different wallet addresses set up for zkEVM Mainnet Beta. Unique wallet addresses are an imperfect representation of user adoption because each user can set up multiple addresses. However, the network has seen a 350% increase in total unique addresses in approximately 90 days, which reflects significant growth in network activity.

How will the launch of Polygon 2.0 affect the MATIC price?

Polygon 2.0 will integrate zero-knowledge proofs with all Polygon protocols in a single multichain ecosystem. This is expected to unlock a new era of scalability, with enhanced transaction processing speeds and reduced gas fees. The move will also involve the launch of a new native Polygon token called POL, which will facilitate the seamless transfer of value across Polygon 2.0’s new multichain ecosystem.

Polygon announced that POL will replace MATIC rewards for validators and that POL can be used for paying gas fees. This could make it the de facto native token for the Polygon ecosystem over time as it would replace and improve upon the core utility of MATIC. Little else has been revealed about the new Polygon token, and speculators remain uncertain about future price movements for MATIC once the migration takes place.

MATIC finds support at $0.53, algorithm forecasts a recovery

MATIC has been underperforming the rest of the crypto markets throughout 2023. The token is currently 27% down YTD, despite the total crypto market cap (TCAP) being 35% up in the same timeframe. MATIC has also been below its daily and weekly EMAs since April, indicating that it has yet to reverse the bearish trend that started back in February.

Regardless, MATIC has found strong support at $0.53 for the time being. If Bitcoin (BTC) and other large-cap tokens see a bounce from the current price level, then MATIC may look to retest the 99 Daily EMA at the $0.70 price level.

The CoinCodex price prediction algorithm expects this to occur in the next month. The algorithm highlights $0.73 as a key price target, before a possible retrace back to the current level of support.

Bottom line: MATIC token continues to post uninspiring price action despite positive project developments

The algorithm does not expect MATIC to maintain its upcoming price increase for long. This has been a common occurrence for MATIC since the beginning of the year, which may indicate low demand for the token at this moment in time.

Despite this, Polygon remains a highly promising layer-2 scalability solution for Ethereum. Polygon 2.0’s zkEVM Mainnet Beta has attracted a growing user base in recent months, and speculators assume that POL, described as a “third-generation token”, could be the one to watch out for.