Polygon's token POL fell more than 12% in the past 24 hours. However, data from the spot and derivatives markets does not entirely point to a new round of decline, with some indicators suggesting that the concentrated selling in the previous phase may be weakening.
Funding rates remain positive
CoinGlass data shows that the funding rate for POL perpetual contracts remains positive, currently at approximately 0.0036%. This typically indicates that bulls still have the upper hand, and market participants are willing to pay the cost to maintain bullish positions.
Meanwhile, open interest related to POL was approximately $48.54 million. During the price decline, this portion of the positions did not fully shift to short, indicating a certain divergence between the positioning structure and price performance in the derivatives market.
Net outflow from the spot market
Similar signals were also observed in the spot market. Over the past day, POL saw a net outflow of approximately $494,000 from centralized exchanges, indicating that after buying pressure was absorbed, some tokens were being transferred out of trading platforms.
In the crypto market, net outflows from exchanges typically mean a decrease in the number of tokens available for immediate sale. If this trend continues, the market may experience a faster recovery after short-term price volatility subsides.
The number of cryptocurrency holding addresses is still increasing.
Despite the price decline, the number of POL holders continued to rise. The report noted that approximately 150 new holders were added, bringing the total number of holders to 138,100.
However, this increase is not significant, and it is not yet possible to determine whether the new addresses are primarily from short-term traders or medium- to long-term holders. This means that while the increase in the number of holders can be seen as continued demand, it is insufficient to definitively confirm a trend reversal.
This round of decline was dominated by panic selling.
The report suggests that this pullback is primarily a continuation of the sell-off that began on May 5th, rather than a sudden deterioration in Polygon's fundamentals. CoinGlass's long/short ratio is currently below 1, indicating that the selling pressure has not yet fully subsided.
Meanwhile, open interest contracted while funding rates remained positive, reflecting that some traders proactively reduced their positions during the decline to avoid further liquidation. Over the past day, total POL market liquidation amounted to approximately $548,600.
Overall, the recent sharp drop in POL appears to be driven by sentiment-driven concentrated selling. If funding rates remain positive and net outflows from exchanges continue, the likelihood of short-term selling pressure weakening further will increase.
