Why did the price of POL fall?
Polygon (POL) dropped 2.54% in the last 24 hours to $0.131, underperforming the overall crypto market, which rose 1.41%. This continues a 7-day decline of nearly 14%, although POL is still up over 23% in the past 30 days. Here’s why:
- Bearish Technical Setup – POL is trading below important moving averages, with a negative MACD indicator showing ongoing selling pressure.
- Weak Altcoin Market – General fear in the crypto market and investors moving money away from altcoins are creating challenges for POL.
Deep Dive
1. Bearish Technical Setup (Negative Impact)
What’s happening: POL’s price is below its 7-day ($0.140), 30-day ($0.128), and 200-day ($0.192) moving averages. This confirms a downward trend. The MACD, a tool that measures momentum, is negative at -0.0025, meaning selling pressure is increasing.
What this means: When a price stays below these key averages, it usually faces resistance when trying to move up. The negative MACD suggests sellers are gaining control, which often leads to further price drops. Watch the $0.135 level closely—if POL stays below this, the short-term outlook remains bearish.
2. Weak Altcoin Market (Negative Impact)
What’s happening: The overall crypto market sentiment is in "Fear" territory, with a sentiment index of 34 (CoinMarketCap). Meanwhile, the Altcoin Season Index is low at 31, showing that investors haven’t yet shifted strongly into altcoins like POL.
What this means: In uncertain times, investors tend to pull back from riskier assets like altcoins. Even though Polygon offers solutions to improve blockchain scalability, it’s still affected by this cautious mood. The small 3.33% increase in the altcoin index over 24 hours isn’t enough to overcome the overall fear, leaving POL exposed to more selling.
Conclusion
POL’s recent drop is due to weakening technical signals and a cautious market environment for altcoins. For current holders, this suggests a period of sideways movement or further declines until buyers step back in.
Key level to watch: Can POL climb back above its 200-day exponential moving average near $0.183? Holding above this could signal a potential trend reversal.
What could affect the price of POL?
Polygon’s future price depends on its shift from being a single-chain scaling solution to becoming a multi-chain economic platform. Its success will balance strong user adoption against tough competition.
- Technology & Token Changes – The rollout of the AggLayer and possible changes to inflation could increase Polygon’s usefulness and reduce selling pressure.
- Institutional & Stablecoin Growth – Partnerships and growing payment volumes create real demand for POL tokens.
- Market Sentiment & Competition – Big investors’ moves and shifts in altcoin interest help, but competition from other Layer-2 solutions puts pressure on profits.
Deep Dive
1. Project-Specific Drivers (Mixed Impact)
Overview: Polygon’s main roadmap, called Polygon 2.0, plans to introduce the AggLayer. This feature lets validators secure multiple blockchains using just one POL token stake, which could increase demand for POL. A major community proposal from October 2025 suggests ending the 2% yearly POL inflation and starting treasury buybacks to reduce selling pressure (Cointelegraph). The switch from MATIC to POL tokens is almost complete (97.83% as of August 2025), which reduces technical uncertainties (Polygon).
What this means: If AggLayer is widely adopted, POL’s value will be closely linked to cross-chain activity, which is a positive long-term sign. However, changing tokenomics to be deflationary isn’t guaranteed and requires community approval. In the short term, the market is watching how well these upgrades are executed.
2. Market & Competition (Bearish Impact)
Overview: Polygon faces strong competition from other Ethereum Layer-2 solutions like Arbitrum, Optimism, and Base. Even though Polygon led in stablecoin user growth in mid-2025 (Cryptonewsland), its native zkEVM chain has seen less activity and lower total value locked (TVL). The overall altcoin market is currently in a “Fear” phase according to the Fear & Greed Index, which affects POL’s price.
What this means: POL’s price might struggle if investors move money back to Bitcoin or other leading Layer-2s. Polygon’s success depends on keeping a competitive edge in transaction speed (aiming for 100,000 transactions per second) and low costs, especially for payment use cases.
3. Sentiment & On-Chain Data (Bullish Impact)
Overview: On-chain data from late December 2025 showed large investors (“whales”) buying about 200 million POL tokens (worth roughly $80 million at the time), indicating smart money is buying at perceived low prices (GzDeFi). Network usage remains strong, with record amounts of POL tokens burned as fees (for example, 3 million POL burned on January 5, 2026), which reduces supply (AMBCrypto).
What this means: Continued buying by whales and high token burn rates can reduce the number of POL tokens available, supporting price increases if demand stays strong. Watching how many tokens leave exchanges and the staking rate (currently about 30-40%) will help understand selling pressure.
Conclusion
POL’s future is a balance between its ambitious technology upgrades and a competitive market. In the near term, keep an eye on AggLayer adoption and governance decisions about inflation. For investors, the hope is that real-world payment growth will eventually outweigh speculative trading. The key question: will Polygon’s institutional partnerships create lasting demand for POL faster than competitors can innovate?
What are people saying about POL?
The Polygon community is buzzing with both optimism and caution as the network’s real-world use grows, but the token price lags behind. Here’s what’s happening:
- Analysts see a shift from positive to cautious sentiment in January, showing a market tug-of-war.
- In-depth discussions suggest POL is moving from a speculative token to one supported by actual revenue and aggressive token burns.
- Apps like Polymarket are driving more activity on the network and generating fees.
- A governance proposal to stop POL’s 2% inflation and start buybacks is sparking debate about the token’s future.
Deep Dive
1. @MarketProphit: Sentiment shifts from bullish to bearish mixed
"$POL Sentiment \n\nCROWD = Bullish 🟩\nMP = Bearish 🟥"
– @MarketProphit (70.3K followers · Jan 12, 2026)
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What this means: This is neutral for POL. While the general crowd remains optimistic, a specialized indicator shows bearish signals, suggesting some informed traders are cautious or selling. This kind of split often happens before a price correction.
2. @FRIENDY84: POL’s rise driven by revenue, not speculation bullish
The user shares a detailed analysis showing POL’s recent price increase is driven by real demand, citing daily fees on the Polygon network of $1.7 million and the burning of 3.01 million POL tokens in one day—more than the rewards given to stakers.
– @FRIENDY84 (1.27K followers · Jan 11, 2026)
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What this means: This is a positive sign for POL. It shows the price rally is supported by actual network use and a shrinking token supply due to burns, moving beyond hype and speculation.
3. @babamusty10: Polymarket fuels Polygon’s utility renaissance bullish
"Polygon is having a real bull moment right now... In the last 72 hours alone, nearly $855K worth of $POL has been burned. That’s more revenue in a few days than Polygon used to generate over entire months."
– @babamusty10 (2.42K followers · Jan 11, 2026)
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What this means: This is good news for POL. It shows how a popular app like Polymarket is driving a big increase in network fees and token burns, proving strong demand for using Polygon’s blockchain.
4. @Cointelegraph: Activist proposal to overhaul POL tokenomics mixed
An article covers a governance proposal to end POL’s 2% yearly inflation and replace it with treasury buybacks aimed at reducing selling pressure and boosting the token’s value.
– Cointelegraph (Oct 6, 2025)
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What this means: This is a mixed signal for POL. The proposal tackles concerns about inflation but also shows frustration in the community over the token’s performance. If accepted, it could boost POL’s price, but if rejected, negative sentiment may continue.
Conclusion
The overall view on POL is mixed but leaning positive. There’s a clear divide: bears focus on price resistance around $0.18 and inflation worries, while bulls highlight growing network payments and token burns as a new foundation of value. The key level to watch is $0.15 support—holding above it could confirm the positive outlook, while dropping below may reinforce bearish trends.
What is the latest news about POL?
Polygon is making big moves to become the main payment system for the internet, but its recent market performance has been a bit unstable. Here’s the latest news:
- Polygon Acquires Coinme and Sequence (January 15, 2026) – A deal worth over $250 million to build a regulated U.S. on-chain payments platform.
- Polygon Labs Announces Workforce Reduction (January 17, 2026) – About 30% of employees were laid off to streamline operations and focus on key goals.
- POL Named Biggest Weekly Loser (January 18, 2026) – The token dropped 18% in one week after a strong price rally, as investors took profits.
Deep Dive
1. Polygon Acquires Coinme and Sequence (January 15, 2026)
Overview: Polygon Labs announced it bought Coinme, a company that operates cryptocurrency ATMs, and Sequence, a company that provides easy-to-use wallet technology. The deal is worth more than $250 million. The goal is to build a fully regulated on-chain payments platform in the U.S., using Coinme’s licenses to operate in 48 states and Sequence’s wallet tech to make payments simple.
What this means: This is a positive sign for POL because it focuses on making Polygon the go-to platform for stablecoin payments and converting between digital and traditional money in a legal way. If successful, this could increase how much the network is used and how much fee revenue it generates.
(CoinMarketCap)
2. Polygon Labs Announces Workforce Reduction (January 17, 2026)
Overview: Polygon Labs cut about 30% of its staff. This move is connected to its recent acquisitions and a renewed focus on its “Open Money Stack” vision, which aims to improve stablecoin payments and real-world financial services.
What this means: In the short term, layoffs can be seen as a negative sign and may hurt investor confidence. However, this could also be a strategic decision to make the company more efficient and better able to deliver on its ambitious plans for payment solutions.
(CoinMarketCap)
Conclusion
Polygon is making a bold shift to become a key player in payment infrastructure by investing heavily in acquisitions and restructuring internally. The big question is whether its focus on regulated on-chain finance will lead to steady growth for the network and increased demand for the POL token.
What is expected in the development of POL?
Polygon’s roadmap for 2026 focuses on improving scalability, enabling seamless cross-chain interactions, and growing its ecosystem.
- Gigagas Upgrade (2026) – Aims to handle 100,000 transactions per second (TPS) for global payments and real-world assets (RWAs).
- AggLayer Full Maturity (2026) – Creates unified liquidity and state across multiple blockchains.
- Breakout Program Airdrops (2026) – POL stakers can receive tokens from projects like Katana and Miden.
1. Gigagas Upgrade (2026)
Overview: Polygon plans to boost its transaction speed to 100,000 TPS by optimizing validators and integrating AggLayer technology. This builds on a previous upgrade (Madhugiri hardfork) that improved speed by 33% in December 2025. The goal is to reach Visa-level performance, making Polygon a strong platform for small payments, AI applications, and settling real-world assets.
What this means: This upgrade is positive for POL because faster transactions can support large-scale uses like international money transfers, which could increase network revenue. However, challenges include coordinating validators and competition from other blockchains like Solana that might reach similar speeds first.
2. AggLayer Full Maturity (2026)
Overview: AggLayer will become a multi-layer system that allows different blockchains—including those outside of Polygon—to share liquidity and transaction data quickly (finalizing in under 5 seconds). This removes risks associated with bridges (tools that connect blockchains) and lets users interact with decentralized apps (dApps) without worrying about which blockchain they’re using.
What this means: This is good news for POL because smooth cross-chain interactions could attract big institutional investors and everyday users, increasing demand for POL as a token used for staking and fees. Risks include slow adoption by major blockchains or potential security issues in the system’s verification methods.
3. Breakout Program Airdrops (2026)
Overview: People who stake POL tokens will be eligible to receive free tokens from projects connected to AggLayer, such as Katana (focused on privacy), Miden (client-side zero-knowledge proofs), and Billions (real-world asset infrastructure). This rewards community participation and broadens Polygon’s use cases.
What this means: This is positive for POL because these airdrops can encourage more staking and reduce selling pressure. However, if project launches are delayed or eligibility rules are unclear, it could temporarily hurt investor confidence.
Conclusion
Polygon’s 2026 roadmap emphasizes faster transactions (Gigagas), better cross-chain connectivity (AggLayer), and incentives for community growth (Breakout). The key question is how well AggLayer’s adoption and POL’s token economics will hold up against growing competition in the modular blockchain space.
What updates are there in the POL code base?
Polygon’s technology has gone through major upgrades to improve scalability and work smoothly across multiple blockchains.
- Validator Staking Upgrade (January 15, 2026) – The PIP-69 proposal lets staked POL tokens work like regular ERC-20 tokens.
- Heimdall v2 Upgrade (July 10, 2025) – Switched to CometBFT consensus for faster transaction finality and safer cross-chain transfers.
- MATIC to POL Migration (September 4, 2024) – POL became the main token for paying fees and staking on Polygon’s Proof of Stake network.
Deep Dive
1. Validator Staking Upgrade (January 15, 2026)
What happened: The PIP-69 proposal introduced dPOL, a token that represents staked POL on a 1:1 basis and is fully compatible with ERC-20 standards. This means these tokens can now be used in decentralized finance (DeFi) platforms like liquidity pools and lending services.
Why it matters:
This change is positive for POL because it allows staked tokens to be used more flexibly, increasing their usefulness and liquidity. Developers can create more advanced financial products using staked POL, which encourages more people to participate in the Polygon ecosystem.
(Source)
2. Heimdall v2 Upgrade (July 10, 2025)
What happened: Polygon replaced its Tendermint consensus with CometBFT, cutting the time it takes for transactions to be finalized from about 90 seconds down to 4–6 seconds. This also improved the reliability of cross-chain operations.
Why it matters:
While there were some short-term risks like network downtime during the upgrade, this is a positive long-term development. Faster transaction finality improves the user experience for decentralized apps (dApps) like Polymarket, which handles over $40 billion in prediction market transactions.
(Source)
3. MATIC to POL Migration (September 4, 2024)
What happened: POL replaced MATIC as the native token for Polygon’s Proof of Stake (PoS) network. This upgrade was automatic for most users but required manual action for those holding tokens on Ethereum or zkEVM.
Why it matters:
This migration is a positive step for POL because it expanded its role in securing Polygon’s AggLayer, a system that coordinates multiple blockchains. By January 2026, nearly 98% of MATIC tokens had been converted to POL, showing strong community support.
(Source)
Conclusion
Polygon’s recent updates show a clear focus on becoming a fast, unified network that works well across different blockchains. The switch to POL, the Heimdall v2 upgrade, and the PIP-69 proposal all make the network stronger and more useful for global payments and multi-chain applications. As more people use AggLayer, it will be interesting to see how POL’s role grows in securing cross-chain transactions and managing fees.