Why is Polygon underestimated in this report?

Polygon is the leading platform in DeFi and expands the network by adding further decentralized applications (DApps). However, a recent report does not seem to properly appreciate the network’s efforts.

Polygon not growing as expected?

The Electric Capital report highlights the growth of many large DeFi ecosystems and rates Polygon fairly low in the rankings. Even lower than Solana, Cosmos and Polkadot.

This view is very different from that of many members of the community. In fact, the founder of Polygon himself has argued that since more than 50% of all Ethereum developers technically also have DApps on Polygon, its development activity should be closer or higher than that of Polygon.

Compare the development of DeFi chains | The source: Electrical capital

The same is true since Polygon hosts more than 163 DApps on the network. The only other chains that excel in this aspect are Binance Smart Chain and Ethereum.

However, in the past few months, DApps on Polygon haven’t made much progress. Total Value Locked (TVL) has fluctuated between $ 4.5 billion and $ 5 billion over the past 5 months and has seen no significant growth.

Also, the DApps on the network were losing TVL very quickly, and most had TVLs under $ 5 million. In fact, some lose more than 40% of their value in a week.

A good example is DAO Nidhi, who lost all of its value recorded in the log in just 24 hours. At the time of writing, it has a TVL <$ 0.0001.

TVL DAO Nidhi | Source: DeFi Lama

Although Polygon attracts a lot of developers, the investment angle when it comes to DApps is important.

The interesting thing is that investors cannot be blamed. MATIC’s 31.14% decline in the past 10 days is a blow to them, and over the same period, over 30% of Addresses have lost profits.

MATIC price promotion | The source: TradingView

The price could drop even further as this altcoin is currently collapsing. In fact, due to its high correlation with BTC, it can run on a broad negative market signal and light up more red candles.

MATIC correlation with Bitcoin | Source: Intotheblock

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