Polygon 2.0 Rollout Begins

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By A D

The Polygon blockchain is gearing up for a transition towards its ‘2.0’ plan, as the smart contracts for the upcoming POL token have gone live on the Ethereum mainnet.

Polygon, a leading Ethereum scaling platform, had recently proposed a significant token upgrade that would replace its existing MATIC token with POL. This transition would enable POL to serve as a unified token across all Polygon-based networks, including the main Polygon blockchain, the Polygon zkEVM network, and various supernets – application-specific blockchains running atop the main Polygon network.

Protocol Council: A Step Towards Security

Polygon Labs has also launched PIP-29, an initiative to establish the Protocol Council. Comprising 13 influential members, including notable figures like ZachXBT, Mudit Gupta, Viktor Bunin, Zaki Manian, and Anthony Sassano, this council is tasked with overseeing crucial changes to Polygon’s technology, especially focusing on the security and smooth operation of smart contracts.

MATIC on the move

Polygon’s native token, MATIC, has been making waves in the crypto market, experiencing a significant 22% increase in the past month. MATIC, at $0.67 with a $5.95B market cap, shows resilience despite a minor 0.3% 24-hour dip. MATIC remains 78.8% down from its all-time high of $2.92, indicating room for growth.

MATIC(Polygon) price chart
Image Source: CMC

In a notable development, MATIC’s 24-hour trading volume has seen a significant upswing, surpassing the $275 million mark. This surge in trading volume suggests heightened activity and investor interest in MATIC.

One intriguing aspect of MATIC’s recent performance is the declining whale activity. Transactions worth at least $100,000 in MATIC have decreased by a substantial 86.5% since October 25. The number of daily whale transactions has fallen from 135 to a mere 18 in the past 24 hours.

Social Voume and Open Interest

MATIC’s social volume has seen a significant drop, down by 63% over the past week. Despite this decline in social chatter, MATIC has maintained its presence in the trending zone on CoinMarketCap.

A contrasting trend emerges as Polygon’s total open interest (OI) has consistently risen over the past two weeks. Data from Santiment indicates that MATIC’s total OI has increased from around $135 million on October 16 to $170 million at the time of writing. This suggests a growing interest in derivative contracts among investors.

The POL Token

POL tokenomics

The POL (Polygon Ecosystem Token) is poised to take center stage as it gradually replaces MATIC over a four-year period within Polygon 2.0. POL is designed to evolve in tandem with the Polygon ecosystem’s growth, ensuring scalability and security.

With validators securing multiple chains, POL contributes to heightened ecosystem security. POL holders gain influence in decision-making through community governance, fostering a more decentralized ecosystem.

MATIC holders will need to execute a swap transaction, converting MATIC to POL at a 1:1 ratio. This phase-out process spans four years, allowing users ample time to make the transition.

The POL token serves as the backbone of the Polygon ecosystem, functioning as both a governance and utility token. It acts as the primary tax currency for Polygon and related networks, facilitating transaction fee payments. Additionally, POL is instrumental in nurturing the ecosystem’s security, economy, and management through innovative features.

  • Restaking: Restaking, a novel concept in the cryptocurrency space, allows POL stakers to secure the network and receive rewards. Validators staking a specific threshold amount of POL can protect secondary networks in the Polygon supernet, earning rewards from transaction fees and additional incentives from the networks they validate. This innovation encourages active participation and network security.
  • Governance: POL token holders are granted governance rights, enabling them to shape the future of the Polygon ecosystem. While the specifics of the governance system are yet to be fully unveiled, it is expected to operate in a manner similar to most DAOs. Holders will have the power to vote on community proposals related to technology, administration, and finance, with majority decisions shaping the project’s direction.

Polygon 2.0: Powered by ZK Technology

polygon 2.0 blockchain layers

Polygon 2.0 introduces a significant transformation, transitioning the Polygon PoS chain into a zkEVM validium network. This move bolsters security, enhances efficiency, and aligns Polygon with Ethereum’s higher security standards. The shift addresses consensus issues and fluctuating gas estimation models, ultimately improving user experiences.

Read: Polygon launches zkEVM mainnet

zkEVM Validiums: zkEVM validiums represent an innovative approach to zk-powered Layer 2 scaling solutions. They provide security guarantees by submitting validity proofs to Ethereum, all while avoiding the need to store transaction data directly on the Ethereum network. This design leads to reduced fees and improved scalability, a promising prospect for Polygon’s future.

Polygon 2.0 Supernet Structure: Polygon’s vision for the supernet structure is to create an efficient value layer for decentralized technologies. This involves a network of networks that share resources and achieve near-instant finality on the Ethereum blockchain. The architecture comprises four key layers: Staking, Interop, Execution, and Proving. Together, they create a compact system of interconnected networks with seamless communication.

Polygon CDK: The Polygon Chain Development Kit (CDK) simplifies the process of launching zk-powered Layer 2 networks within the supernet. It offers a modular and open-source framework that empowers developers to create networks aligned with Polygon 2.0’s principles. These networks inherit security and interoperability features, enriching the Polygon ecosystem.

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