Polygon’s Tightening Supply Hints at Potential Breakout Amid Buyer Strength

• Declining exchange reserves tighten POL supply, limiting liquidity and supporting upward price momentum.

• Rising active addresses reflect increased network engagement and healthy expansion.

• Derivatives data shows buyer dominance with 90-day Taker Buy ratios favoring accumulation amid cooling liquidations.

Polygon POL reserves decline signals tightening supply and bullish momentum. Explore active addresses surge, derivatives trends, and price outlook for potential breakout in 2025. Stay informed on crypto trends today.

What factors are driving the decline in Polygon POL exchange reserves?

Polygon’s POL exchange reserves have continued to decline sharply since mid-October 2025, falling to multi-month lows as tokens leave centralized platforms. This steady reduction signals tightening supply and reduced selling pressure from large holders. Typically, when exchange reserves fall, the available market liquidity decreases, allowing price momentum to strengthen once demand rises.

How can shrinking reserves and higher active addresses impact Polygon’s short-term outlook?

Shrinking reserves and higher active addresses signal tightening supply and rising accumulation momentum. Moreover, the surge in active addresses reflects robust on-chain engagement, highlighting a healthy network expansion phase. Together, these supply and demand shifts suggest that accumulation could be taking shape, laying the groundwork for Polygon’s next potential breakout. Data from on-chain analytics platforms like CryptoQuant indicates that active addresses have risen by over 20% in the past month, underscoring growing user interest in Polygon’s ecosystem.

Is a breakout imminent for Polygon POL?

Polygon’s price continues to hover within a descending channel between $0.21 and $0.17, where repeated rebounds at lower levels emphasize buyer strength. The shaded green zone around $0.18 acts as the main accumulation range where bulls repeatedly defend support. Meanwhile, the MACD indicator shows a narrowing gap between signal and MACD lines, hinting at an early bullish crossover that could ignite upward momentum.

A breakout above the descending trendline may push the price toward $0.25 and later $0.29. However, if the $0.17 floor weakens, short-term downside pressure could resurface before any sustained recovery emerges.

Source: TradingView

What do derivatives and liquidation data reveal about Polygon POL’s upcoming price direction?

Futures market data shows Taker Buy dominance over the past 90 days, indicating that buyers maintain control even amid brief corrections. This shift highlights growing confidence among spot traders, accumulating at discounted prices. Additionally, it reinforces the narrative that institutional participants may be positioning early ahead of a broader market recovery.

The balance of power favoring buyers typically supports price stability after extended declines. Hence, sustained Taker Buy dominance paired with low exchange reserves adds conviction to the possibility of a trend reversal in the near term. According to derivatives analytics from CryptoQuant, the cumulative volume delta has remained positive for buyers, with ratios exceeding 55% in recent sessions.

Source: CryptoQuant

Key liquidity zones near $0.19 and $0.18 for Polygon POL

CoinGlass liquidation heatmap data highlighted heavy liquidation activity around $0.19 and $0.18, zones where leveraged traders have been squeezed recently. These clusters often represent short-term liquidity pools that attract price reversals once leveraged pressure cools. The minimal liquidation buildup below $0.175 suggests reduced downside volatility, reinforcing that the current range could serve as a consolidation base.

Therefore, if buying momentum continues to absorb remaining sell orders, the token might regain stability above $0.19, turning this liquidity region into a springboard for the next upward push. Recent 24-hour data shows over $2 million in liquidations clustered in these levels, providing clear zones for potential price magnets.

Source: CoinGlass

Is a Polygon POL recovery on the horizon?

Polygon’s tightening supply, strong network activity, and sustained buyer dominance collectively hint at a potential rebound forming. With volatility cooling and key support levels holding firm, the token appears to be transitioning from accumulation to preparation for a breakout. A decisive close above $0.21 could confirm the start of Polygon’s next bullish phase.

Frequently Asked Questions

What is the current status of Polygon POL exchange reserves in 2025?

Polygon’s POL exchange reserves have declined sharply since mid-October 2025, hitting multi-month lows as tokens move off centralized exchanges. This trend reduces available supply on trading platforms and points to accumulation by long-term holders, potentially easing selling pressure in the short term.

How might rising active addresses affect Polygon POL’s price?

Rising active addresses on the Polygon network indicate growing user engagement and ecosystem adoption. This on-chain activity often correlates with increased demand for POL tokens, supporting price stability and potential upward movements as more participants interact with decentralized applications.

Key Takeaways

• Declining Reserves Strengthen Supply Dynamics: The sharp drop in POL exchange reserves since mid-October 2025 limits liquidity, fostering conditions for price appreciation amid rising demand.
• Buyer Dominance in Derivatives: 90-day Taker Buy ratios highlight sustained control by buyers, signaling confidence and positioning for a market recovery.
• Liquidity Zones as Reversal Points: Key levels at $0.19 and $0.18 show past liquidation clusters, which could now act as support for an upcoming breakout above $0.21.

Conclusion

In summary, the decline in Polygon POL exchange reserves combined with surging active addresses and bullish derivatives signals points to a strengthening foundation for recovery. As network activity expands and supply tightens, POL appears poised for a potential breakout from its current descending channel. Investors should monitor key support at $0.17 and watch for confirmation above $0.21 to capitalize on emerging opportunities in the Polygon ecosystem.