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Why is Polygon (MATIC) outpacing Ethereum in NFT sales?

Why is Polygon (MATIC) outpacing Ethereum in NFT sales?

Polygon (MATIC) has had a successful run in the cryptocurrency market thanks to network upgrades such as increased staking and gas rates. Furthermore, it has significant partnerships both within and outside of the cryptocurrency market, which contribute even more to its growth. One of the areas in which Polygon has expanded in the field of non-fungible tokens (NFTs). To illustrate the extent of Layer 2’s expansion, it has sold more individual NFTs on its network than Ethereum (ETH). The OpenSea marketplace reported over 1.5 million NFT sales on Polygon’s scalable network in January, outpacing Ethereum’s 1.1 million sales during the same period. Despite having a higher traded value in NFTs than Polygon ($446 million), Polygon has consistently outperformed the smart contracts platform in the NFT sector since the end of 2022. According to OpenSea data, the most popular NFT collections on Polygon are Trump Digital, Lens Protocol, and Unstoppable Domains.

What could be behind Polygon’s performance?

Solana’s (SOL) decline may have played a significant role in Polygon’s (MATIC) recent success in the NFT sector. Solana was once a major player in NFTs, second only to Ethereum, but its decline following the FTX collapse has harmed its performance in this area. Several scandals have also contributed to Solana’s loss of ground to Polygon. For example, in early 2023, Magic Eden, Solana’s NFT marketplace, sold counterfeit digital art, causing the NFT marketplace’s reputation to suffer. Despite the project’s promise to compensate affected buyers, the harm has already been done. In addition, the team behind NFT projects y00ts and DeGods received a $3 million investment to migrate its Solana collections to Polygon, putting additional strain on the SOL blockchain. The move to Polygon was made due to its superior platform for their projects, according to Frank III, the projects’ founder. Polygon’s strategic partnerships and low-fee model also contribute to its NFT growth. Polygon adds value to its ecosystem by collaborating with companies such as Meta, Starbucks and gaming projects. Its fee structure is significantly lower than that of Ethereum, making it a more appealing option for NFT projects. Furthermore, when compared to the Ethereum network, Polygon’s unique architecture allows for easier and faster creation, trade, and transfer of NFTs. Polygon is poised for continued growth in the NFT sector as these factors work in its favour.

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