In a significant advancement for the cryptocurrency sector, the Polygon team has commenced the official transition from the MATIC token to the newly introduced POL token. This change represents a crucial milestone for the second-layer blockchain network, reflecting the ongoing evolution within the crypto landscape.
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The initiation of this transition was first communicated in July and began implementation on Wednesday. Holders of MATIC tokens experienced an automatic conversion of their assets to POL tokens at a one-to-one ratio, ensuring a seamless transition for the community.
On Wednesday, the Polygon team took to Twitter to remind users of the impending upgrade, stating, “We interrupt your doomscroll with another reminder – MATIC will be upgraded to POL tomorrow.” This announcement was further supported by a blog post detailing the technical aspects of the upgrade, providing clarity and information to the community.
The blog highlights that the transition from MATIC to POL represents a significant advancement in aligning Polygon with its objective of becoming an “aggregated network of blockchains.” In the initial stage of this transition, POL will replace MATIC as the primary gas and staking token for the Polygon Proof-of-Stake (PoS) network. Furthermore, there are intentions for the new token to assume a vital role within the forthcoming AggLayer affiliate blockchain aggregation system.
The shift from MATIC to POL is described as a pivotal moment for the Polygon networks, as it enhances functionality and supports the overarching vision of Polygon as an integrated network of blockchains. The blog post elaborates on this technical upgrade, with the Polygon team providing additional insights regarding the migration process and its implications for the network’s future.
It is essential to recognize that the shift was prompted by the deliberate destruction of the MATIC upgrade keys several years prior, which effectively barred any subsequent modifications to the token.
“The main reason the upgrade was technically necessary is because the MATIC upgrade keys were intentionally burned years ago. That basically means we can’t make changes to that token,” Polygon Labs CEO Marc Boiron stated in an interview on Tuesday.
The introduction of the new POL token is anticipated to significantly alter the tokenomics of Polygon, featuring a decreased annual emission rate set at 2% of the total supply. A segment of the newly minted POL tokens will be allocated to incentivize Polygon’s Proof Of Stake (PoS) validators, while the remaining tokens will be channeled into the project’s treasury. This treasury will play a crucial role in supporting ecosystem development initiatives, which include a dedicated grant program.
Major centralized exchanges have initiated the process of facilitating the migration from MATIC to POL. Binance has publicly declared its intention to eliminate MATIC trading pairs from its platform on September 10, subsequently replacing them with the new POL token starting September 13. This transition marks a significant step in the evolution of Polygon’s token structure.
Interestingly, throughout this migration phase, the price of MATIC has exhibited a notable degree of stability. The cryptocurrency has been trading within the $0.38 range for the majority of the day, despite experiencing a decline of 5.34% over the preceding 24 hours. This resilience in price suggests a level of investor confidence amid the ongoing changes within the Polygon ecosystem.
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