Polygon mulls replacing MATIC with a new token in 2.0 upgrade
- Polygon has released three proposals regarding the 2.0 upgrade.
- When the SEC sued Binance in June, it classified MATIC, among other tokens, as a security.
Polygon [MATIC] developers on 14 September officially released a set of three Polygon Improvement Proposals (PIPs) on the 2.0 upgrade. One of these proposes replacing the MATIC token with a new token POL.
The proposals also discussed the outline of the upgrade and specifications for the new architecture. Here’s a look at all the three proposals in detail.
The first proposal, PIP-17, details how the blockchain would adopt the POL token. As the native gas and staking asset of the Polygon ecosystem, it will replace the existing MATIC token.
The second proposal, PIP-18, talks about Phase 0 of Polygon 2.0. It states that end-users and developers on the existing Polygon PoS and Polygon zkEVM chains need not do anything when the 2.0 upgrade takes place.
The third proposal, PIP-19, urges that the switch from MATIC to POL token on the blockchain take place in a way that preserves compatibility with smart contracts on Polygon PoS. In this manner, the code properties of POL will remain the same as those of MATIC.
The team of developers at Polygon has urged the community members to provide feedback on these proposals. The team will implement these proposals as they get approved.
But the SEC classified MATIC as security, remember?
Polygon is expected to upgrade in 2024.
It was in June that Polygon proposed the 2.0 upgrade about transitioning to a zero-knowledge (ZK) solution. In July, it proposed for the first time replacing native token MATIC with POL. It explained that POL would be a “hyperproductive” token that enables holders to become validators as it would only require a simple smart contract upgrade for MATIC.
It also underlined at the time that its decision had nothing to do with the U.S. Securities and Exchange Commission’s (SEC) decision to label MATIC as an unregistered security.
When the SEC sued Binance [BNB] in early June, it classified MATIC, among other tokens, as security. Polygon soon responded to the SEC’s claim, saying it was developed outside the U.S. It said MATIC is an integral part of its operations and it has played a crucial role in ensuring the security of the Polygon network.
Since the SEC’s enforcement action, MATIC has lost 40% of its value. At press time, it was trading at $0.52109.