Major update aims to enhance network functionality; users must prepare for seamless token migration.
The Polygon network is preparing for a major transformation scheduled for September 4, 2024. This change involves transitioning from its native MATIC token to a new token called POL. The update is designed to enhance the network's functionality and efficiency, with POL set to become the new gas and staking token for the Polygon Proof-of-Stake (PoS) network.
For users holding MATIC tokens on the Polygon PoS network, the transition will be seamless. Their tokens will be automatically updated to POL. However, those holding MATIC on other platforms will need to manually migrate their tokens on a 1:1 basis. This means that for every MATIC token, users will receive one POL token.
The introduction of POL is expected to improve Polygon's scalability. This means the network will be able to handle more transactions at a faster rate, which could potentially increase the value of the tokens by 20%. The new token aims to make the network more efficient and functional, benefiting all users.
In the lead-up to the migration, Polygon's user activity has dipped to multi-month lows. Despite this, the DeFi sector within Polygon has seen a 5% rise in total value locked (TVL) and a 21% increase in decentralized exchange (DEX) trading volume. This indicates that while overall activity has decreased, specific sectors within the network are still thriving.
MATIC's price has remained relatively stable, trading at $0.41. Interestingly, there has been a 27% increase in trading volume, suggesting that traders are actively engaging with the token despite the upcoming changes. The uncertainty surrounding the migration has led to a decrease in transactions, but there is growing bullish momentum for MATIC. This means that the token's price could move significantly depending on market trends.
