Polygon's POL Token Plunges 6% Amid Inflation Shock and Market Volatility

Polygon's POL token fell 6% on Thursday, following a broader market decline triggered by higher-than-expected US inflation data. The token traded in a wide 10% range before reversing sharply and dropping to $0.24, with trading volume spiking to 1.1 million units. The selloff was part of a broader market decline, with the CoinDesk 20 Index dropping 4%.

Polygon's POL token experienced a significant decline on Thursday, dropping by 6% to $0.24. This selloff occurred as a result of higher-than-expected U.S. wholesale inflation data, which rattled risk assets across the crypto market [1]. The token traded in a wide 10% range before reversing sharply, with trading volume spiking to 1.1 million units, more than triple its daily average [1].

The selloff was part of a broader market decline, as the CoinDesk 20 Index, a benchmark for the broader crypto market, dropped by 4% over the same period. Profit-taking accelerated across major cryptocurrencies, with many tokens experiencing sharp declines [1]. The $0.26 mark has now emerged as a significant resistance zone after a high-volume rejection [1].

The U.S. producer price index (PPI) report, released on July 31, showed a 0.9% month-over-month rise in July, the biggest jump in more than three years. This data, which measures wholesale inflation before it reaches consumers, dampened expectations for Federal Reserve rate cuts and pressured speculative assets [1]. The report came alongside a revision of June's annual rate from 2.3% to 2.4%, reinforcing the picture of sustained cost pressures in the production pipeline [3].

The market reaction to the PPI data underscores the continued sensitivity of crypto markets to high-impact macroeconomic events, particularly when leverage is elevated. The rapid decline in crypto prices, including Bitcoin and Ethereum, within 20 minutes of the data release, highlights the vulnerability of leveraged positions to such shocks [3].

The broader impact of the inflation data on the crypto market was compounded by comments from U.S. Treasury Secretary Scott Bessent. Bessent stated that the U.S. government has no plans to purchase additional Bitcoin and rejected the BITCOIN Act, dampening market optimism [4]. This, coupled with the higher-than-expected inflation data, contributed to the wave of selling pressure in the crypto market.

In summary, Polygon's POL token fell sharply on Thursday due to higher-than-expected U.S. inflation data and a broader market decline. The token's selloff was part of a broader market reaction to the PPI data, which underscored the continued sensitivity of crypto markets to high-impact macroeconomic events. The market is now closely watching for further policy signals and economic indicators that could influence the trajectory of digital asset prices.

References:
[1] https://www.coindesk.com/markets/2025/08/14/polygon-drops-10-from-highs-as-inflation-shock-triggers-heavy-polygon-selling
[2] https://www.coindesk.com/coindesk-indices/2025/08/14/coindesk-20-performance-update-uniswap-drops-8-2-as-nearly-all-assets-decline
[3] https://finance.yahoo.com/news/420-million-wiped-20-minutes-094604492.html
[4] https://www.ainvest.com/news/bitcoin-news-today-bitcoin-ethereum-plunge-3-2-2-5-bessent-comments-inflation-concerns-2508/