Polygon's MATIC Upgraded to POL, Enhancing Token Utility

September 04, 2024 11:15 PM AEST | By Team Kalkine Media

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Polygon's MATIC Upgraded to POL, Enhancing Token Utility — Image source: Shutterstock

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Polygon has executed a significant upgrade to its native cryptocurrency, transforming MATIC into the new Polygon Ecosystem Token (POL). This shift, effective September 4, repositions POL as both the network's gas and staking token, marking a major step forward in Polygon 2.0.

According to Marc Boiron, CEO of {Polygon} (POL) Labs, this upgrade is designed to foster greater community involvement in the network's development. Boiron explained that the introduction of 2% emissions through this upgrade provides the community with more opportunities to engage with and benefit from the network’s growth. Even though the full migration to POL is ongoing, early implementations, such as the community grants program, have already started creating emissions that the community can utilize.

The POL token, which now ranks as the 21st largest cryptocurrency with a market cap of $3.7 billion, is a critical component of Polygon’s broader vision for Polygon 2.0. The upgrade aims to make POL a “hyperproductive” asset, a step beyond the capabilities of MATIC. While MATIC generated fees solely from gas and staking, POL will earn fees from a variety of activities. This includes staking to secure data availability and decentralizing a sequencer, with additional fee-generation avenues planned for the future.

Boiron highlighted that POL’s expanded functionality represents the next evolution of Ethereum's fee structure, which is limited to transaction-based gas fees. The upgrade reflects Polygon's ambition to enhance its network's efficiency and scalability, aligning with the goals of Polygon 2.0.

For MATIC holders, the migration to POL is straightforward. Staked MATIC will automatically convert to POL, requiring no additional action from users. The successful execution of the testnet upgrade on July 17 paved the way for this transition, which is integral to the rollout of Polygon's AggLayer, a cross-chain interoperability protocol aimed at connecting disparate blockchains.

This upgrade signifies a pivotal moment for Polygon, reinforcing its commitment to advancing blockchain technology and expanding its ecosystem's capabilities.

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