Exploring the Benefits of MATIC Conversion to POL in Crypto May 2022

Polygon 2.0 and its Four Protocol Layers

Polygon Labs’ vision for a layer-2 Ethereum ecosystem, powered by zero-knowledge cryptography, is beginning to come to life with the introduction of three Polygon Improvement Proposals (PIPs) that will start the transition to Polygon 2.0.

In June 2023, the scaling technology firm revealed its plans for the scaling ecosystem, which is made up of four protocol layers: staking, interop, execution and proving. These layers are designed to create an interconnected network of chains that can facilitate fast value transfer and information sharing.

Sandeep Nailwal, co-founder of Polygon, has recently explained how the ecosystem aims to become the value layer of the internet by using crypto technology and AI powered zero-knowledge (ZK) technology to provide low-fee, high-throughput performance to the Ethereum network.

The voting on the three PIPs is expected to take place in the last quarter of 2023, marking the first steps towards a fully functioning Web 3.0 powered by crypto matic.

Crypto Token Migration

The Polygon Improvement Proposals (PIPs) outline the technical details for the “Phase 0” of establishing a crypto network of interconnected ZK-powered layer-2 chains that scale Ethereum. This includes a proposal for the transition from MATIC (MATIC) tokens to POL tokens, which will become the native crypto token of the Polygon proof-of-stake (PoS) protocol.

PIP-17 will initiate the upgrade from MATIC to POL, which includes its transition to POL as the native gas token and staking token for the Polygon ecosystem, as well as the launch of the staking layer and migration of Polygon public chains.

PIP-18 provides the technical description of POL tokens, as well as accompanying contracts that will handle emission and crypto token migrations. POL tokens can be migrated at a 1:1 ratio from existing MATIC tokens. The PIP notes an initial supply of 10 billion and a yearly emission of 2% equally distributed between validator staking rewards and a community treasury.

Lastly, PIP-19 proposes the update of the native gas token on Polygon PoS from MATIC to POL while ensuring maximum backwards compatibility.

Polygon’s announcement states that PIP-19 will not alter contracts on Polygon PoS, while the characteristics of the protocol’s crypto token will remain unaffected. However, contracts on Ethereum that are expecting MATIC from the native MATIC bridge may be impacted by the upgrade.

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