Recently, layer 1 solutions such as the Solana (SOL) and Cosmos (ATOM) have grown in prominence due to the faster transaction times and lower costs of each network compared to the Ethereum network. An even greater focus has fallen on layer 2 solutions that can help Ethereum keep up with the competition as it continues to transition to proof-of-stake.
One project that has seen a steady increase in user activity and transactions over the past 2 months is Polygon (MATIC), a platform for Ethereum scaling and infrastructure development.
Data from Cointelegraph Markets and TradingView shows that since hitting a low of $ 0.26 when the market sold on April 18, the MATIC price is up 50% to $ 0.39 as adoption of this grows L2 platform starts to ramp up.
Migrating popular projects to Polygon
Following the announcement in early February that the Matic Network would be rebranded as Polygon as part of its effort to become the go-to L2 aggregator for the Ethereum network, the protocol has seen a significant increase in user and project adoption.
Polygon, the top #ethereum layer 2 is going crazy!
Integrations with Aave, Pooltogether, Sushiswap, Open Sea, Curve Finance, Decentraland and many other major #defi applications.
TVL on Aave on Polygon is approaching 1 billion. $ matic undervalued
– Lark Davis (@TheCryptoLark) April 25, 2021
Since the rebranding, multiple decentralized financial (DeFi) and non-fungible token-related projects have made the decision to integrate with Polygon to take advantage of the fast, low-cost environment.
Some of the more important DeFi integrations include the decentralized exchange SushiSwap (SUSHI) and Curve Finance (CRV), while Open sea, Decentraland (MANA) and Aavegotchi (GHST) are large NFT communities now using the Polygon network.
On March 31, the popular DeFi lending platform AAVE arrived announced that Polygon was exploring “new frontiers of scalability,” and that the subsequent launch of AAVE on the L2 solution quickly grew to $ 1 billion in cash and over 7,200 users just 10 days after launch.
A great day for that @ 0xPolygon and the entire Ethereum ecosystem!
$ 1 BILLION in liquidity and 7.2,000 USERS on a single application 10 DAYS after launch!
Big thanks to the great @AaveAave team and the entire Ethereum community!
This is just the beginning, stay tuned! pic.twitter.com/wqvoOLgNbT
– Mihailo Bjelic (@MihailoBjelic) April 24, 2021
DEX volume increases
Popular decentralized exchanges such as Uniswap and SushiSwap have been a major catalyst for the growth of DeFi and the cryptocurrency sector as a whole over the past year, demonstrating the importance of a well-functioning DEX for the growth of the ecosystem.
While SushiSwap is a protocol that has made integrations with the Polygon network along with numerous other blockchains, the QuickSwap DEX is a project solely focused on increasing the available liquidity for the Polygon ecosystem.
As can be seen in the charts above, liquidity and trading volume on QuickSwap rose rapidly from the end of February and this trend continued into March. In the past two weeks, there has been a noticeable increase in volume on the platform and this is in line with the recent adoptions of Polygon.
The increased activity on decentralized exchanges is due in part to the growing list of projects now available on Polygon. A quick scroll through the project’s Twitter feed shows a long list of recent integrations, including IoTeX (IOTX), Everipedia (I.Q), Gelato network (GELATO), Just Bet (WINR) and Umbrella network (UMB), just to name a few.
In the future, it is likely that a growing number of Ethereum-based projects will look for a faster, low-cost environment that also allows them to stay on the best smart contract platform. If they switch to Polygon, there is a chance of significant upside potential, and the current MATIC price growth and QuickSwap’s rising TVL both serve as evidence that the protocol is a strong low-2 contender.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trade move carries risks, you should do your own research when making a decision.