Layer 2 blockchain Polygon is set to migrate its MATIC token to POL as part of its upgrade to Polygon 2.0. According to a July 18 announcement from the Polygon Foundation, the upgrade will commence on September 4. Initially, POL will replace MATIC as the primary token for gas payments and the staking token for its proof-of-stake (PoS) consensus.

Over the long haul, the token will play a crucial role in the AggLayer, Polygon’s growing network of aggregated blockchains. The current community consensus proposes that POL will support broader roles in the Polygon staking hub, set to release in 2025, including block generation, zero-knowledge proof generation, and participation in Data Availability Committees (DACs).

The POL upgrade went live on the Polygon testnet on July 17, providing network developers and infrastructure providers time to prepare for the mainnet upgrade. Users holding MATIC on the Polygon network are not required to take any action, as their tokens will be automatically upgraded. However, those holding MATIC on Ethereum, Polygon zkEVM, or centralized exchanges will need to bridge, update smart contracts, or use a migration contract.

For users on most major centralized exchanges, the upgrade is expected to be done automatically. However, if a non-custodial user fails to update the Remote Procedure Call (RPC) settings in their crypto wallets, it may incorrectly display “MATIC” instead of “POL” as the token symbol. RPC settings are configuration details that allow wallets like MetaMask to communicate with a specific blockchain network.

At the time of publication, there is no deadline set for MATIC holders on Ethereum and Polygon zkEVM to upgrade to POL. The community will have the power to establish a deadline in the future. Plans to replace MATIC with POL were initially announced in July 2023, with the Ethereum contract for the POL token launched a few months later, on October 25.

POL migration is the first step in laying the foundation for Polygon 2.0, which is described as the “Value Layer of the Internet.” The upgrade is expected to offer significant scalability and liquidity improvements. POL will have an initial supply of 10 billion tokens and offer holders governance rights in the Polygon 2.0 ecosystem. Additionally, 2% of the entire POL supply will be set aside annually for validator rewards and the community treasury.

The upgrade comes as Polygon’s NFT sale volume surpassed that of Solana and Bitcoin earlier this month, despite the overall NFT sector witnessing a more than 70% drop in the total number of NFT buyers.

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