While many cryptocurrencies have had a favorable run this month, Polygon’s native token appears poised to close out January as a notable highlight.
MATIC is up 19% over the past week to $1.19, according to data from CoinGecko, pushing gains for the token to over 50% in January. This is because Bitcoin and Ethereum have increased in value by almost 44% and 38%, respectively, over the past 30 days.
At the time of writing, MATIC is the 10th largest cryptocurrency by market cap with a total value of $10.6 billion.
Polygon is a sidechain that runs alongside Ethereum and seeks to improve on its counterpart by offering faster transactions, lower fees, and serving as a platform for interoperable blockchains.
As the token undergoes a sustained rally, the pseudonymous Twitter account @lookonchain pointed to a wallet address that was generating significant returns using MATIC.
The polygon whale received 4 million MATIC from cryptocurrency exchange Binance in September 2020 for around $84,000, or just over 2 cents per token. Two days ago, the wallet parted with its $5.2 million worth of MATIC holdings for stablecoins, according to Etherscan.
Although the sale included more MATIC than the original purchase of Binance’s wallet, the trader still saw a return of about 50 times the original price they paid for the 4 million MATIC, which is worth about 4.5 million US dollars or US$1.14 per token at the time of sale.
However, the recent bounce is a far cry from the token’s December 2021 peak of $2.92. The token remains almost 60% below its all-time high. At its highest price, the 4 million in MATIC purchased in 2020 would have been worth $11.7 million.
MATIC’s price action comes as Polygon prepares to implement an upgrade that was first announced in July of last year. Polygon co-founder Sandeep Nailwal recently tweeted that Polygon’s zkEVM update has an official date and will be released soon.
Just come off a high level zkEVM mainnet launch committee
Can’t keep calm folks
WE HAVE A DATE for the mainnet launch!
And it’s SOON! pic.twitter.com/y7pcR9OdEZ
—Sandeep | Polygon 💜 Top 3 by Impact (@sandeepnailwal) January 16, 2023
Polygon’s zkEVM is a scaling solution that is compatible with existing Ethereum smart contracts and uses the cryptographic method of zero-knowledge proofs to more efficiently verify large volumes of transactions – called rollups.
Zero-knowledge proofs are used in cryptography to prove that a statement is true without revealing its content or the steps taken to confirm a particular statement as true.
When Polygon announced the launch of its zkEVM, Polygon co-founder Mihailo Bjelic said the update could put Ethereum on par with global payment processor Visa in terms of how quickly transactions could be processed.