Polygon investors’ activity stumbles as MATIC price crashes by 30% in a month

• MATIC price has been on a decline since April 16, losing nearly 30% after hitting $1.18 to trade below $0.84 at the time of writing.
• The active address ratio is currently at 0.26%, lower than even Floki Inu’s 0.39%.
• Investor’s decision to stay put for now makes sense as nearly 74% of all MATIC holders are underwater, awaiting profits.

MATIC price has witnessed the lower ranges of March over the last month and is currently on the way to potentially test year-to-date lows. The fear of this happening has left investors paranoid, resulting in their pull back from the network. This maneuver will end up playing in their favor as the altcoin is exhibiting signs of recovery.

MATIC price takes a break from forming lower lows

MATIC price has observed a drawdown of nearly 30% in the span of 30 days. After marking $1.18 as the April high, the cryptocurrency started charting red candlesticks bringing the price down to the $0.84 area at the time of writing.

MATIC/USD 1-day chart

This decline has spooked the investors to the point that they have pulled back from conducting transactions on the network. The active addresses, which were averaging around 3,000 around mid-April, have come down to 1,500 in the duration that MATIC price fell by 30%. The last time investors’  presence was this low was back in March 2021. This impacted the active address ratio as well, which is presently at an all-time low.

MATIC active addresses

The active address ratio represents the number of investors participating on-chain against the total addresses holding any amount of MATIC. In the case of Polygon, this ratio is at 0.26%, which is far lower than many of the other altcoins, even the meme coin Floki Inu’s 0.39%. While this is concerning as it suggests the presence of bearishness among the investors, it is rather beneficial to MATIC price.

MATIC active address ratio

As long as these investors continue to HODL, MATIC price would have an opportunity to climb back up and recover profits. For the same to happen, investors would need to refrain from panic selling as it could trigger a further decline. As is, over 74% of all Polygon investors are currently underwater.

The historical break-even price chart shows that more than 440,000 addresses are currently realizing losses. This naturally means that until MATIC price climbs back to profitable levels, investors’ activity will likely remain minimal.

MATIC investors at a loss

A resurgence in presence can be expected when MATIC price manages to flip the $1 mark as a support floor. This is not only because it is an important psychological level, but also because most of the decline in investors’ activity began once, the altcoin fell below this point.

---