Polygon, a leading blockchain scaling platform, has unveiled its third-generation token, POL, as part of a significant upgrade to its ecosystem. The new token was launched on the Ethereum mainnet and is set to replace the existing MATIC token, following the company's roadmap. This development was managed by Polygon Labs, the entity behind the Polygon sidechain.
The launch of POL plays a pivotal role in the network's broad upgrade plan. The new token will allow holders to become validators within the network across Polygon's extensive series of tech solutions. This includes application-specific blockchains tailored for specific use cases and zero-knowledge EVM-based networks like zkSync Era Starknet, and Linea.
POL also facilitates users staking their holdings across compatible chains. Upon depositing their assets, users start earning protocol rewards and transaction fees on each staked chain. Existing MATIC holders have been given a four-year migration period to switch to POL.
The transition from MATIC to POL is not influenced by recent regulatory actions where MATIC was labeled a security by the U.S. Securities and Exchange Commission in lawsuits against Binance and Coinbase (NASDAQ:COIN). This transition requires no action from MATIC holders or node operators.
Following the announcement of the transition, MATIC's price experienced a 4% drop, reducing its market cap to $5.8 billion. The changes were first introduced in June 2023 and involve upgrades to the native gas token system and Intelligent Bridge MATIC contract, overseen by a decentralized governance structure featuring an ecosystem council for smart contract upgrades.
Looking forward, Polygon aims to move its PoS chain exclusively to zkRollup and establish a new interoperability standard for its multiple chains. This marks a significant upgrade in the ecosystem and aligns with Polygon's 2.0 roadmap which includes the establishment of a new staking layer and zero-knowledge-proof interoperability protocols.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.