Polygon (CRYPTO:MATIC), one of the leading layer 2 solutions in Ethereum (CRYPTO:ETH), announced a significant upgrade to its network.
What happened
According to BitFinanzas, the MATIC token will be converted to POL, a move designed to improve the network’s capabilities and prepare it for future expansions. This transition is part of the network’s roadmap. Polygon 2.0which seeks to improve the functionality and scalability of the ecosystem.
As part of this migration, MATIC holders on the Polygon Proof of Stake (PoS) chain saw their tokens automatically converted to POL. However, MATIC holders on other platforms, such as the Ethereum network, needed to manually migrate their tokens using the interface. Polygon Portal or through a bridge to Ethereum.
Polygon hinted that a timeframe for this conversion could be introduced in the future. The POL token will play a pivotal role in the upcoming Polygon 2.0 improvements, serving as the native gas and staking token on the Polygon PoS network.
The new POL token will have a 2% annual issuance rate, designed to reward validators and replenish the community treasury. This aligns with Polygon’s goal of creating a future-proof token that can support the growth and security of its ecosystem.
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Why is it important?
The transition from MATIC to POL is a crucial step in Polygon’s evolution. Over the past few months, Polygon has been working on its 2.0 roadmap, which includes a number of technical and strategic improvements to strengthen its network. In May 2023, Polygon announced the implementation of zkEVM (Zero-Knowledge Ethereum Virtual Machine), a scalability solution that uses zero-knowledge proofs to improve the efficiency and security of transactions on the network.
Furthermore, in July 2023, Polygon revealed its intention to launch a new decentralized governance model, allowing token holders to have a greater influence on network decisions. This move towards greater decentralization is seen as an effort to increase transparency and trust in the Polygon ecosystem.
The introduction of the POL token and its integration into the 2.0 roadmap underlines Polygon’s commitment to staying at the forefront of innovation in the Blockchain space. With a controlled issuance rate and a focus on rewarding validators, Polygon seeks to ensure the long-term sustainability and growth of its network.
Image courtesy of Shutterstock
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