Polygon (MATIC) Profitability Posts Shocking Figures

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Polygon (MATIC) has shown conflicting on-chain data trends, particularly relating to the profitability of its addresses. according to According to data from crypto analytics platform IntoTheBlock (ITB), only 5.63% of Polygon addresses are profitable or have broken even.

Discrepancy between Polygon fundamentals and price action

Polygon is a unique Ethereum-based layer-2 scaling solution, although its uniqueness hasn’t translated into a high price recently.

According to ITB’s data, not a single address on the Polygon network is entirely profitable. The data also revealed that 3,651 addresses were “profitable” at the time of writing. As of now, a total of 612,580 addresses, or 94.37%, are “unprofitable,” or in other words, losing money.

Polygon address profitability chart. Source: IntoTheBlock

This is a very concerning trend given the widespread adoption of Polygon-focused technologies, including the Polygon CDK, which is powering a range of new chains as L2 pivots and extending its services to developers looking to build related or alternative chains.

So far, Polygon’s CDK has been used by Flipkart, OKX, and many other innovators looking to make a difference in Web 3.0. In addition to CDK, Polygon zkEVM is another technology that showcases Polygon’s advanced capabilities.

However, amid the innovation, MATIC fell by up to 4.9% in 24 hours to $0.5516. Over the past month, the token has fallen by an additional 24.34%, accelerating the plummet in profitability for associated ecosystem addresses.

General L2 Trends

With most altcoins mimicking Bitcoin in terms of key on-chain metrics, the Ethereum Layer 2 ecosystem as a whole appears to be insulated from this trend.

Polygon has recorded a significant drop in addresses, but Bitcoin address profitability remains pegged at 86.81% despite the recent sell-off.

The only consolation for Polygon is that other top L2 protocols such as Arbitrum (ARB) have also recorded similar address attacks, with ITB data showing over 97% of addresses lost despite a large ecosystem and product adoption.

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Godfrey Benjamin

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