The Polygon token POL dropped more than 12% over the past 24 hours. However, data from both spot and derivatives markets do not fully indicate a new downward trend, as some indicators suggest that the previous phase of concentrated selling may be weakening.
The funding rate remains positive.
CoinGlass data shows that the POL perpetual contract funding rate remains positive, recently around 0.0036%. This typically indicates that long positions still dominate, with market participants willing to pay a cost to maintain bullish positions.
Meanwhile, open interest related to POL is approximately $48.54 million. During the price decline, this position did not fully shift to short positions, indicating a certain divergence between the positioning structure in the derivatives market and price performance.
Net outflow observed in the spot market.
The spot market has also shown similar signals. Over the past day, approximately $494,000 worth of POL has net flowed out of centralized exchanges, indicating that after buying pressure was absorbed, some tokens are being withdrawn from trading platforms.
In the crypto market, a net outflow from exchanges typically indicates a reduction in 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 holding addresses continues to increase.
Even during the price pullback, the number of POL holders continues to rise. The report notes that approximately 150 new holders were added recently, bringing the total number of holders to 138,100.
However, this increase is modest, and it is still too early to determine whether the new addresses are primarily from short-term traders or medium- to long-term holders. This means that the growth in the number of holders suggests demand remains, but it is not sufficient on its own to confirm that the trend has reversed.
This downturn is driven by panic selling.
The report suggests that this pullback primarily continues the selling pressure that began on May 5, rather than being caused by a sudden deterioration in Polygon’s network fundamentals. The long/short ratio on CoinGlass is currently below 1, indicating that selling pressure has not yet fully subsided.
Meanwhile, the open interest has decreased while the funding rate remains positive, indicating that some traders have voluntarily reduced their positions during the downturn to avoid further liquidations. Over the past day, the total liquidation amount across the POL market was approximately $548,600.
Overall, POL's recent sharp decline appears to be driven by concentrated selling fueled by sentiment. If funding rates remain positive and net outflows from exchanges continue, the likelihood of further short-term selling pressure easing will increase.