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Polygon, the leading Ethereum Layer-2 scaling solution, migrated its native $MATIC token to a new token, $POL, according to a Sept. 4 CoinTelegraph report.
Now, $POL will serve as the network’s native gas and staking token. This transition is part of Polygon's plan to advance its infrastructure and integrate it with zero-knowledge (ZK) technology.
Why the Migration to $POL?
The upgrade from $MATIC to $POL is crucial for Polygon’s ambitious plans to evolve into a zero-knowledge Ethereum Virtual Machine (zkEVM) system under its “Polygon 2.0” roadmap. POL will eventually be used across multiple interoperable blockchains within the Polygon ecosystem.
Polygon’s roadmap envisions $POL as a versatile token that will serve several functions beyond gas fees and staking.
Validators who stake $POL will not only secure the Polygon Proof-of-Stake (PoS) chain but also have the opportunity to earn rewards by staking on other chains in the Polygon ecosystem, a concept known as the “AggLayer.” This feature is designed to consolidate liquidity and state across the network, making $POL a critical component of Polygon’s future growth.
The Transition Process
For most $MATIC holders, the transition to $POL will be seamless. If you hold $MATIC on the Polygon PoS chain or centralized exchanges, your tokens will automatically convert to $POL on a 1:1 basis.
However, if you hold $MATIC on the Ethereum network or on Polygon’s zkEVM layer 2, you will need to manually migrate your tokens to $POL. This can be done using a migration contract provided by Polygon. The process is straightforward but is recommended for experienced users to avoid any potential issues.
Despite Polygon's assurances that there is no immediate deadline for completion, it is advisable to act sooner rather than later to avoid any complications during the transition.
Implications for Token Holders
With the transition to $POL, Polygon introduces new tokenomics that are designed to support the network’s long-term growth. One of the key changes is a new annual emission rate of 2%. This emission rate is split between validator rewards and a community treasury, as Polygon Labs CEO, Marc Boiron, told CoinTelegraph.
The treasury is intended to be a self-sustaining ecosystem fund, supporting various activities within the Polygon network.
$POL will also play a role in Polygon’s broader technology stack. It will be used in block production, zero-knowledge proof generation, and participation in Data Availability Committees (DACs). These functionalities are critical for maintaining and expanding Polygon’s capabilities as a leading Layer-2 solution.