As Polygon launches the first NFT collection on zkEVM, can it spur MATIC

• Polygon’s NFT trade count declined last week, and sales volume also went down marginally. 
• MATIC’s price registered an uptick, and its demand in the derivatives market increased. 

Polygon’s [MATIC] NFT space witnessed a decline over the last seven days. Santiment’s chart revealed that Polygon’s total NFT trade count went down sharply over the last week. Moreover, NFT sales volume registered a marginal decline last week, as evident from CRYPTOSLAM’s data. 

Source: Santiment

How much are 1,10,100 MATICs worth today  

A closer look at Polygon’s NFT space

Polygon’s NFT space might witness a boost over the coming days, as on 2 May the protocol announced the launch of the first NFT collection on the zkEVM mainnet. This launch has the potential to increase sales and trade counts.

💌 Dear ‘To Ethereum, with Love’ Soulbound Token holders,

Check your wallets – The first #zkEVM Mainnet Beta NFT collection is here, and it’s landed in your wallet 👀 pic.twitter.com/l0qGO8C6kf

— Polygon (Labs) (@0xPolygonLabs) May 2, 2023

The official tweet mentioned that token IDs #80001+ will receive “Unconstrained”, token IDs #20001-#80000 will receive “Scalability”, and token IDs #1-#20000 will receive “For Mankind” NFTs. With this new launch, growth in Polygon’s NFT ecosystem can be expected, as it might attract new users.

zkEVM’s state as it launches new NFTs

zkEVM’s performance was declining for quite some time now as its key metrics dwindled. For instance, the number of unique depositors and deposits on zkEVM remained low. 

Source: Dune

Gas usage also declined over the past few weeks, suggesting less use of the platform. However, the good news was that after a steep decline, daily transactions on zkEVM showed signs of recovery as the graph registered an uptick lately. 

Source: Polygonscan

MATIC is recovering 

MATIC, which has been facing the wrath of the bears for quite a few days, also gave hope for brighter days. According to CoinMarketCap, MATIC’s price increased by more than 2% in the last 24 hours. At the time of writing, it was trading at $0.983 with a market capitalization of over $9 billion.

Is MATIC’s price hike sustainable?

Matic’s demand in the futures market increased, as evident from its green Binance funding rate. Net deposits on exchanges were low compared to the 7-day average. This can be interpreted as lower selling pressure. However, apart from these, most metrics were against a price hike. 

Source: Santiment

Realistic or not, here’s MATIC market cap in BTC‘s terms

MATIC’s network growth declined, hinting that fewer new addresses were used to transfer the token. Whales’ interest in Polygon also seemed to have declined.

Another bearish indicator was an uptick in MATIC’s supply on exchanges. This was accompanied by a decline in the token’s supply outside of exchanges, which is a typical bearish signal. 

Source: Santiment