Polygon rises when developers say goodbye to Terra

by Arthur · July 12, 2022

Illustration of coins and pictures — Unlike most altcoin prices, Polygon rose on Monday after cryptocurrency developers decided to say goodbye to the troubled Terra blockchain. – Photo: Shutterstock

Polygon’s MATIC coin rose on Monday after developers of cryptocurrency projects decided to say goodbye to the troubled Terra blockchain.

MATIC was up approx. 2.2% around the time when conventional markets closed in North America, and stood out on an otherwise hit-and-miss trading day. (All figures based on CoinMarketCap data.) The increase came after Terra users migrated their projects to the Polygon blockchain that supports MATIC.

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Many projects on the go

Polygon Studios CEO Ryan Watt said on Twitter on Friday that more than 48 Terra projects – and more – are part of the migration. Projects that have moved to Polygon include the OnePlanet non-fungible token (NFT) marketplace and Derby Star’s metaverse horse racing games to earn the game that awards cryptocurrencies as prizes.

Polygon is a layer-two blockchain built on top of the Ethereum blockchain.

“When it comes to projects migrating to the Polygon network, I’m not surprised,” Weiss Ratings analyst Alex Benfield told Capital.com. “Polygon has been a very popular platform for developers for the last year or so, since the network is significantly cheaper than [Ethereum] but is still [Ether Virtual Machine] compatible.

“Polygon is currently working on zk rollups that could attract a few more projects that want to evolve on cutting-edge technology.”

Zk rollups refer to zero-knowledge roll-ups which, according to CoinMarketCap, allow transactions to be completed faster while keeping gas or transaction fees to a minimum.

Popular dApp offers higher prices

Alex Benfield, Weiss Ratings Analyst (courtesy of Alex Benfield)

The more projects that are built on Polygon, the greater the chance that it will host a strong decentralized app (dApp).

“A very popular dApp can increase network activity, which inevitably results in higher token prices,” Benfield said.

Polygon, he added, has also “created waves” because, like a proof-of-stake blockchain, it is friendly to environmental and social governance (ESG). The network recently achieved carbon neutrality, which means that it emits and absorbs the same amount of carbon dioxide, and works to become carbon negative.

Under a carbon-negative scenario, an organization removes more carbon dioxide than it emits, according to EY.

OnePlanet is leading the migration through its project called Ark One.

“The sudden collapse of the Terra ecosystem left a lot of innovative NFT projects and their communities stranded in the wreckage,” OnePlanet said in a blog post.

“In search of light in the abyss, OnePlanet has taken the lead and built its own version of Noah’s Ark to save Terra’s growing NFT biodiversity and take it to a new home. [i.e. Polygon]. “

UNI to USD

Problems related to collapsed coins

Terra is the blockchain behind the related luna and terraUSD coins collapsed in May and became virtually worthless. Nosedives, which caused a cryptocurrency market crash, happened when terraUSD, a stack coin, lost its link to the US dollar.

OnePlanet said that Ark One has become much more than a salvage operation because the NFT universe is “in dire need” of a fully decentralized and NFT launch platform run by that organization. A total of 48 NFT projects comprising 90 NFT collections applied for migration to Polygon during an application process that ended on 15 June.

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“This represents a large proportion of Terra projects, including some that were not launched on OnePlanet before the catastrophic de-peg event,” OnePlanet said in the blog post.

OnePlanet aims to add value

OnePlanet said that their “vision” is to add value to the NFT universe by giving the best Terra NFT projects a “lifeline” while bringing its decentralized launch and marketplace into Polygon.

The OnePlanet NFT marketplace will be launched on Polygon in mid-August. OnePlanet said that Terra crypto wallets with a polygon address can migrate qualified NFTS to projects that joined Ark One.

However, Benfield said MATIC, which traded between $ 0.56 and $ 0.60, needs to establish more price stability before it can make steady gains.

“MATIC seems to be channel trading like most other cryptocurrencies at the moment,” he said. “It needs to recover $ 0.60 as strong support before it has any chance of becoming bullish in the medium term.”

No other top coins shine

Otherwise, there were no top 100 coins shining on Monday as new financial problems such as those that have hit the crypto hedge fund Three Arrows and digital coin lenders Celsius Network and Voyager Digital did not emerge. Most leading currencies were down, but the declines were relatively modest and in line with normal market fluctuations.