The Polygon price rebounded on Wednesday as cryptocurrencies staged a cautious rally. The MATIC/USD coin jumped by more than 4% to $1.3645, which was the highest level since Monday this week. It is still about 24% below the highest point this month.
DeFi boosts Polygon
Polygon, formerly known as MATIC, is a relatively fast-growing layer 2 platform that helps developers to supercharge their Ethereum applications. The platform helps to solve some of the biggest challenges that face Ethereum’s network, including slow speed, limited scalability, and interoperability issues.
Polygon has been on a fast-growing trend in the past few months, helped by the growth in Decentralized Finance (DeFi), gaming, and Non-Fungible Tokens (NFT). This growth has been helped by the fact that Ethereum’s network has become congested and expensive to most people.
Therefore, many platforms have been moving to the ecosystem, which has helped boost MATIC price. MATIC is the native token for Polygon’s ecosystem. According to DeFi Llama, there are about 28 DeFi platforms in Polygon’s network. These platforms have a total value locked of more than $4.82 billion, which is substantial since it was inexistent a few months ago.
Some of the most popular DeFi platforms in Polygon are Aave, which has a TVL of more than $1.96 billion. It is followed by Quickswap, which has a TVL of more than $850 million and Curve, which has a TVL of about $388 million. At its peak in June, the total value locked in Polygon’s network was more than $10 billion.
The Polygon price is also bouncing back because of Gary Gensler’s testimony on Tuesday. Testifying before the Senate Banking Committee, the SEC chair did not have a bombshell about the DeFi industry. Additionally, it is rising as investors buy the dips after this week’s US inflation data. Further, it is rising after the recent partnership with EY.
Polygon price forecast
The daily chart shows that the MATIC price has risen in the past two consecutive days. It has risen from this week’s low of $1.0935 to the current $1.3800. This price is a few points above the lower line of the ascending channel. It has also moved to the 50% Fibonacci retracement level and is along the 25-day and 50-day moving averages.
Therefore, in the near term, there is a likelihood that the coin will rise to $1.800, which is along the upper side of the channel and slightly above the 38.2% retracement level. This price is about 33% above the current level. On the flip side, a drop below $1.100 will invalidae the bullish view.