Polygon Whales Continue to Buy 120 Million Matic Is About to Rebound?

On-chain data shows that Polygon whales have loaded 120 million Matic in the past week, a sign that could be positive for the asset’s price.

Polygon whales have recently increased their holdings

As one analyst noted in an article on X, Matic whales have made a lot of purchases over the past week. The relevant metric here is the “Supply Distribution”, which tracks the total amount of Polygon currently carried in the wallets by different groups of holders.

In the context of the current topic, whales are the object of interest to us, and their group address balances range from 10 million to 100 million Matic (about 7.7 million to 77 million US dollars at current exchange rates).

Whales are the most powerful entities on the network because of the sheer size of their reserves. As a result, their movements are often worth keeping an eye on, as they may eventually have an impact on the value of the asset.

Now, the chart here shows the trend of the Polygon supply distribution over the past month for these huge holders:

As you can see in the chart above, the indicator values of Polygon whales have risen significantly over the past week. Together, these large investors raised more than 120 million Matic (about $92.5 million) during this period.

These purchases from whales come at a time when the cryptocurrency price has been trading near the lows after a sharp pullback from the $1 level.

Of course, this accumulation may be a positive sign for the future of the asset, as it suggests that the whale believes that the current price is already low enough to gamble more.

Although this may be the case, Polygon has recently been brewing another signal, but this one is not so rosy. As another analyst explained in the CryptoQuant Quicktake post, Matic has seen a considerable increase in foreign exchange reserves recently, as shown in the chart below.

The “Exchange Reserve” here is an indicator that tracks the total amount of Polygon currently stored in all centralized exchange wallets.

It is evident from the chart that the indicator started to rise shortly after the recent asset rally, which means that investors are starting to make net deposits.

One of the main reasons investors transfer tokens to exchanges is for sale purposes, so these deposits are likely to come from those who want to take advantage of profit-taking opportunities.

This is not particularly alarming behavior, but the worrying fact may be that foreign exchange reserves will only continue to rise even after the asset has observed a significant downtrend from the top, which means that the selling pressure has not slowed down.

The whale buildup is a bullish sign for Polygon, but as long as these exchange inflows continue, the price is unlikely to feel any benefit in the near term

Source: Golden Finance