Polygon's Token Upgrade: What You Need to Know About the Move from MATIC to POL
- On September 4, 2024, Polygon is upgrading its native token from MATIC to POL.
- The POL token is part of Polygon's broader "AggLayer" vision, aiming to host multiple ZK-powered L1 and L2 blockchains with shared security.
- POL validators will be able to validate multiple chains and gain increased rewards.
- MATIC holders on the Polygon PoS chain will automatically have their tokens converted to POL.
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What’s Happening?
Polygon is set to introduce a new token called POL on September 4, 2024, replacing the current MATIC token. This change is part of a bigger plan to evolve Polygon from a single proof-of-stake (PoS) network into a vast ecosystem of blockchains powered by zero-knowledge (ZK) technology.
Why the Switch from MATIC to POL?
Polygon’s upgrade is all about creating what they call the "AggLayer"—a scalable network of connected blockchains that share liquidity and security. With this setup, Polygon aims to make crypto as user-friendly as the internet we use today.
Understanding the AggLayer
The AggLayer will consist of multiple ZK-powered blockchains, all secured by a common group of validators. This setup will allow nearly instant cross-chain transactions and eliminate the need for each blockchain to have its own bridge to Ethereum.
Polygon will also provide developers with tools to easily create new blockchains (L1 and L2) within the AggLayer. Additionally, the new zkEVM prover kit will help existing Ethereum-compatible chains transition to ZK L2s, connecting them to the AggLayer.
What is the POL Token?
POL is the new token for the Polygon ecosystem, set to replace MATIC on a 1:1 basis. Starting September 4, 2024, POL will be used for paying gas fees and staking on the Polygon PoS chain.
Polygon is positioning POL as a "third generation" crypto token, following in the footsteps of Bitcoin (BTC) and Ethereum (ETH). POL will offer enhanced utility and greater incentives for validators, who will be able to validate multiple chains and earn additional rewards.
POL Token Features
- Shared Security: POL validators can secure multiple chains.
- Increased Rewards: Validators can take on additional roles and earn more.
- Community Treasury: POL will support a treasury to fund development, research, and adoption incentives.
- Governance: POL holders will have a say in how the community treasury is managed.
POL Tokenomics
POL will start with a supply of 10 billion tokens, the same as MATIC. It will have an annual emission rate of 1% for staking rewards and another 1% to fund the community treasury.
How to Transition from MATIC to POL
If you hold MATIC on the Polygon PoS chain, your tokens will automatically convert to POL on September 4, 2024. If your MATIC tokens are on Ethereum or Polygon zkEVM, you’ll need to use a migration contract to make the switch.
Centralized exchange users may need to manually exchange their MATIC for POL, although some exchanges like Nexo will handle the conversion automatically. Polygon hasn’t set a deadline for this migration, so you can upgrade your tokens at your own pace.
Final Thoughts:
The launch of the POL token marks the start of an ambitious new chapter for Polygon. With this upgrade, Polygon aims to address the fragmentation and user experience issues in the crypto industry, building on its success as a leading blockchain platform for decentralized applications.
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