Today's big event analysis: What changes will the upgrade of MATIC to POL bring?

After MATIC was upgraded to POL, some important changes have taken place in the token economics, which will also affect the future value of the token.

First of all, Polygon has announced two major plans before. One is to upgrade the Polygon PoS chain to the ZkEVM Validum chain to improve network speed and scalability; the other is to migrate MATIC 1:1 to POL tokens. This migration will start on September 4, 2024. MATIC holders can automatically complete the token conversion through some CEX platforms (such as Binance and OKX), and can also be manually migrated on DEX platforms.

The launch of the POL token has brought about adjustments in token economics. The previous inflation reward of the MATIC token of the Polygon network has ended. In order to continue to maintain the enthusiasm of validators, Polygon plans to add 200 million POLs as rewards every year for 10 years. If the price of POL is $0.5, then this part of the reward is worth about $100 million per year. In addition to this basic reward, Polygon has designed more incentives, such as providing additional benefits to validators through the AggLayer technology stack and liquidity layer.

After staking, the staker (that is, the coin holder) can not only obtain benefits by minting new coins, but also charge fees from the aggregator in the network, or obtain additional token rewards from other chains. There will be more forms of rewards in the future, such as shared sorting benefits and zero-knowledge proof benefits.

From the demand perspective, this upgrade will increase the demand driven by staking. Currently, the number of people participating in MATIC staking is less than 33,000, and the staking yield is about 5.65%. After the upgrade, the yield is expected to rise to 7-8%, and with the application of AggLayer and other projects, the yield may be further improved. In addition, some projects may airdrop additional token rewards in the future, like Celestia, to further attract more users to participate in staking, and even let the number of stakers reach more than 100,000.

In general, this upgrade is a good time to promote the transformation of MATIC. With the advancement of Polygon technology and the increase of partners, the demand and value of POL tokens may increase significantly. #PolygonPOL #MATIC✅.