Polygon (MATIC) NFT Volume Rebounds: Will Price Follow Suit?

On Aug. 2, Mojo Melee, a Polygon network-based NFT gaming project, announced a six-month partnership with global tech and e-commerce giant Amazon. On-chain data analysis explores how the Amazon partnership could impact the MATIC price as NFT trade volume bounces.

Amazon Prime subscribers can now snag a free Polygon NFT on Mojo Melee, an NFT-based gaming project built on the Polygon network. Recent data shows that Amazon has 200 million subscribers globally. 

With such a large pool of subscribers, bullish Polygon (MATIC) investors are hopeful that the Amazon partnership could boost adoption and network demand. 

The Amazon Partnership Has the Potential to Boost Polygon NFT Trades

According to historical on-chain data, the NFT trade partnership with Amazon can potentially boost the MATIC price. After a week-long downtrend, MATIC NFT trades have been trending upward since the Amazon partnership announcement. 

As shown below, Polygon NFT Trade Volume (<$1k) had dropped by 75% from 10,523 on July 26, to 2,668 on Aug. 2. Since the announcement, it has climbed over 4,400 and 4,800 in the last two days respectively.  

NFT Trade Volume (<$1k) evaluates the daily volume of NFTs worth less than $1,000 traded on a blockchain network. Growth NFT demand is bullish for the underlying token for a number of reasons. 

Fundamentally, users burn a small amount of MATIC as a transaction fee when minting NFTs on the Polygon network. This removes them from circulation and effectively reduces MATIC supply. While the transaction fees are much lower than other projects such as Ethereum, this ideally makes the MATIC blockchain more attractive. 

Unsurprisingly, historical data shows that spikes in Polygon NFT trade volume often correlates to previous MATIC price increases.

Drawing conclusions from these early on-chain signals, the Mojo Melee partnership with Amazon can potentially boost Polygon NFT trade volume. 

MATIC Whale Investors Did Not Get the Memo

While the Amazon partnership could benefit the MATIC price, a critical cluster of MATIC whale investors still appear unconvinced. 

On-chain data from Santiment shows that whales holding cumulative balances of 10 million to 100 million MATIC are currently in sell-off mode.

As shown below, the whales held a cumulative balance of 173 million MATIC tokens as of July 15. But currently, this has decreased to 129.96 million tokens remaining in their wallets. This means they have already offloaded about 43 million MATIC. 

At current market prices of $0.66, the 43 million MATIC recently sold by the whales is worth approximately $28.4 million. Such large outflows within a short period could impact MATIC price negatively. 

Considering these mixed on-chain indicators, the MATIC price action will likely remain neutral in the coming days. 

MATIC Price: Bulls and Bears Stuck in Limbo

According to IntoTheBlock’s IOMAP data, MATIC currently trades in the middle of two formidable supply walls ranging from $0.65 to $0.70. 

This further confirms the prediction that despite the Amazon partnership, MATIC price will likely remain neutral in the coming days. 

As seen below, 9,003 addresses holding 43.7 million MATIC at the minimum price of $0.65 could prevent a bearish swing. And even if that support level caves, the buy-wall at $0.63 will likely force a rebound. 

In contrast, the bulls will also have some difficulty breaking out of the $0.72 territory. As depicted above, 6,960 holders that bought 259.2 million MATIC at the average price of $0.69 could prevent an outright rally.

Even if that resistance gives way, the sell-wall at $0.72 will likely trigger a pullback.