What is Polygon's POL Token & How Does it Work?

$POL (Polygon Ecosystem Token) is the native gas and staking token of the Polygon network (@0xPolygon), one of the best known Ethereum Layer 2 scaling networks, running on proof of stake. It pays for transactions, secures the chain through staking, and gives holders a say in how the ecosystem spends its treasury. $POL replaced MATIC in 2024, and it was built to do something MATIC could not: secure many chains at once.

If you held MATIC, you most likely hold $POL now whether you lifted a finger or not. Here is what the token is, how the switch happened, and how it actually works today.

From MATIC to $POL: What Changed?

Polygon's first token was MATIC. In July 2023 the team proposed replacing it with $POL as part of the Polygon 2.0 roadmap. The migration went live on September 4, 2024 at a 1:1 ratio, so no new tokens were created and the starting supply mirrored MATIC's roughly 10 billion.

On the Polygon PoS chain the swap was automatic. MATIC balances became $POL, and most users only saw the ticker change in their wallet. Holders with MATIC on Ethereum or on exchanges had to migrate manually through the official Polygon Portal. According to Polygon, about 99% of MATIC had migrated to $POL roughly a year after launch, and every transaction on Polygon PoS has used $POL as the native gas token since September 2024. The upgrade also expanded what staking $POL can entitle validators to do, including block production and zero-knowledge proof generation.

This was an upgrade, not a fresh token sale. The goal was to turn a single-chain token into one that can power a whole network of chains.

What Does $POL Actually Do?

$POL has three jobs today.

Gas: It pays transaction fees on the Polygon PoS network. Fees usually run a fraction of a cent, which is why the network leans hard into payments and high-volume apps.

Staking: Validators and delegators lock $POL to secure the chain and earn rewards. Those rewards come from new token emissions plus a share of network fees. As of early 2026, around 3.6 billion $POL was locked in staking contracts, close to a third of the supply.

In April 2026 Polygon gave that locked capital somewhere to go. It launched sPOL, its first native liquid staking token. Stake $POL through it and you get sPOL back, a receipt token you can use across DeFi as collateral or liquidity while the underlying $POL keeps earning rewards. The point is to put idle stake to work. Before sPOL, only about 4 to 5% of staked $POL was liquid, well behind Ethereum, where most staked ETH sits in liquid staking.

Governance: $POL holders help decide how the Community Treasury is spent, including on grants and development funding.

$POL also sits at the center of Polygon's longer-term plan. The AggLayer, Polygon's system for linking separate chains into one network with shared liquidity, has been live on mainnet since early 2025 and is connecting a growing set of chains. The piece still being finalized is $POL's role inside it: the "one stake, many chains" idea, where a validator secures several chains with the same staked $POL. The infrastructure is in production, but the staking and fee mechanics that tie $POL to it are still maturing.

How Does $POL's Tokenomics Work?

$POL started at 10 billion tokens. By mid 2026 the circulating supply sat near 10.65 billion, with no maximum supply set.

The token has a built-in 2% annual emission. According to Polygon's documentation, that splits into 1% for validator and staking rewards and 1% for the Community Treasury, which funds grants and ecosystem growth. The schedule kicked in after the original MATIC reward plan wound down in 2025, and the rate was later adjusted through a community vote known as PIP-26. Governance can change emissions in the future, but the smart contract caps how fast new $POL can be minted.

There is no hard supply cap. Polygon chose an inflationary model on purpose, so emissions fund security and development on a predictable schedule rather than depending on fee revenue, which can dry up when activity is low. The tradeoff is dilution. New $POL enters circulation every year, whether the network earns it or not, and that only works long term if usage grows enough for fee burns to offset the new supply.

Where is $POL Used?

Beyond gas and staking, $POL sits under a wide range of activity:

• Payments and stablecoins, including cross-border transfers and merchant settlement. This is now one of Polygon's main pitches, with about $3.7 billion in stablecoins issued on the network.
• DeFi, covering lending, borrowing, trading, and liquidity, with roughly $1.1 billion locked in Polygon DeFi protocols as of June 2026.
• Gaming and NFTs, where low fees and fast confirmation matter most.
• Real-world assets and institutional use, such as tokenized funds and regulated staking.

The network processed about 1.4 billion transactions in 2025, a sign that on-chain usage, not just trading, drives demand for the token.

Is $POL Inflationary or Deflationary?

This is where the simple "it's inflationary" label breaks down.

On paper $POL adds 2% supply per year through emissions. But Polygon PoS still burns part of every transaction fee, the same EIP-1559 mechanism Ethereum uses. When the network is busy, those burns can outrun new emissions.

In early 2026 that is exactly what happened. Polygon reported daily burns of roughly 1 million $POL during a usage spike, which annualizes to about 3.5% of supply, more than the 2% that emissions add each year. During those stretches $POL is effectively deflationary, even though its design is inflationary.

So the whole thing rests on real network activity. Emissions are fixed and predictable. Burns are not. The more the network is used, the tighter the $POL supply gets.

Sources

• Polygon — official blog confirming the migration reached 99% and that $POL has been the PoS gas token since September 2024.
• Polygon Docs — primary reference on $POL's 10 billion initial supply, the 2% emission split, PIP-26, and the mint cap.
• Polygon — official announcement of sPOL and the staker rewards push.
• CoinMarketCap — live circulating supply (~10.65 billion), no max supply, and market data.
• DefiLlama — Polygon DeFi TVL (~$1.11 billion) and stablecoin market cap (~$3.7 billion) as of June 2026.
• AInvest — early-2026 reporting on daily $POL burns, staking lock-up, and the emission-versus-burn dynamic.