High fees for trading on Ethereum have increased the use and adoption of the Polygon Network in the NFT OpenSea market over the past year. According to data from Dune Analytics, monthly sales of NFTs within this blockchain grew by more than 127,000% in 2021. Last December, more than 1.98 million NFTs were sold on Opensea through this blockchain network. .
Polygon, formerly known as the Matic Network, is a Proof of Stake sidechain developed in 2017 to improve the scalability of Ethereum. Although in its first months of life it was little known, the innovation and technology that accompany this blockchain solution today position it among the 15 most important cryptocurrencies in the industry. In the decentralized finance ecosystem, Polygon is the eighth largest blockchain by liquidity, with a total of $5.12 billion deposited and 165 protocols implemented on its chain.
Polygon, NFT and Opensea
Ethereum’s scalability problems, which began to worsen in 2017, coinciding with the ICO boom, have become more acute with the rise of DeFi and NFTs. Network commission rates have skyrocketed 1,200% in the last year, prompting investors and users to explore new, more viable and accessible alternatives.
In this context, Polygon is presented as a scalable solution from which it is possible to transact faster and cheaper than in the main Ethereum blockchain. Which makes it an ideal network to support the growing mass adoption of DeFi, NFT and gaming. Polygon co-founder Sandeep Nailwal told Cointelegraph that the commission fees for trading on the network were 0.001 MATIC (just a fraction of a US cent).
Although NFT trade and trading volume on Opensea have declined since Q4 2021, on Polygon it has reached new all-time highs. So far in January, NFT sales at Opensea through Polygon exceed 426,500.
$76.1 million in December, 2021
According to on-chain data, the monthly volume transacted within Opensea through Polygon reached $76.1 million last December, marking a new all-time high for the network. Daily trading volume peaked at $4.5 million on December 23. On-chain data reveals how popular the sidechain is gaining within the NFT market, although its volumes still remain low compared to Ethereum.
The number of active traders within the network has also grown exponentially in the last year. As of mid-2021, the number of active Opensea operators and merchants on Polygon, who used the network at least once to transact NFTs, was approaching 1,300 per month. Currently they exceed 85,000. Last September, users who used Polygon to trade NFTs on Opensea numbered over 270,000.
Number of unique transactions skyrockets
In the past year, the number of daily unique transactions on Polygon has also grown exponentially, skyrocketing 2,500%. The number of unique transactions on the network barely exceeded 100 Txns per day in January 2021. It currently stands at over 4,000 Txns. Its peak was seen last May, when it reached 9,800 Txns per day, in line with the boom in the crypto market.
The number of unique active addresses per day also grew exponentially. Even at the end of September, it momentarily exceeded the number of daily active addresses on the Ethereum network. As indicated by the co-founder of Polygon, Mihailo Bjelic, on his Twitter account.
Retail users and merchants
Another important fact that reveals the growth of Polygon within NFT markets such as Opensea is the number of transactions compared to the value spent. According to Dune Analytics, most users use Polygon to transact with low value, between $0 and $100 USD.
The number of NFT transactions made, versus the value spent, reveals that this blockchain network is being heavily used for retail transactions. The main reason is its almost imperceptible costs and the almost instant blocking time. Nailwal noted that transactions on Polygon take just 2.3 seconds to confirm, while on Ethereum the average block time is 15 seconds. The speed and accessibility that Polygon allows gives small merchants and beginners a great opportunity to interact with NFTs, away from the high fees that have to be paid in Ethereum.
Images: from Dune Analytics and Pixabay