Why Polygon (POL) prices are collapsing In addition to the direct reaction of the community
, other decentralized financial protocols have already started to act in response to Polygon's bridge proposal. For example, Mark "Billy" Zoeller, founder of AaveDAO, offered to launch #Aave four days later as a direct response.
Zoeller stated that "Polygon represents 1.5% of Aave DAO's revenue" and that the risk of $1 billion in bad debt was not worth it. He believed it was worth it. This argument was made in a post by Ignace, who explained that it would be a significant loss for #Polygon . If @lemiscate [(Marc "Billy" Zeller)]'s proposal passes, LTV will be set at 0% (effectively a cessation of operations), Polygon's numerous Aave V3 asset reserves will be frozen, and even the management team will leave Polygon. That's what [L] Polygon is.
Notably, Polygon's native tokens are trading at $0.594, down 38.65% YTD, despite the cryptocurrency being in a bull market. Moreover, POL (formerly MATIC) trading volumes have dropped significantly since late September, suggesting a lack of investor interest.
Meanwhile, AAVE is up nearly 120% over the past 30 days, as reported by Finbold, and could be bullish for the rest of the year. LINE_. BREAK Now traders and investors are speculating on the implications of Polygon's proposal to grow #DeFi crop with bridge reserve. In addition, Abe's response could have a significant impact on POL demand and utility and affect market prices.
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