Here are the key developments surrounding the Polygon Foundation’s recent MATIC activity:
- The Polygon Foundation deposited nearly $6 million in MATIC on the Binance exchange, according to available data.
- Speculations abound regarding the possibility of a significant MATIC discharge in the near future.
- MATIC’s price has experienced a decline of over 15% in the past month and is down nearly 81% from its all-time high.
Recent MATIC Transactions:
Recent on-chain data from Lookonchain reveals intriguing transactions involving Polygon Foundation Wallet Addresses:
- Address 0x8d36 deposited 6 million $MATIC, equivalent to $3.35 million, into the Binance exchange in the past 2 days.
- Another Polygon Foundation address, 0xf957, sent 4.6 million $MATIC, valued at about $2.57 million, to Binance over the past 30 days.
This sudden move by the Polygon Foundation has left many investors perplexed and led to speculations about potential future liquidations. This uncertainty may prompt investors to transfer their MATIC tokens to exchanges, potentially causing further declines in token prices.
Polygon Network Overview:
The Polygon network was developed as a layer 2 solution within the Ethereum network, aiming to enhance the speed and cost-effectiveness of Dapps, smart contracts, and transactions compared to the Ethereum network.
The native token of the Polygon network is MATIC, which serves multiple roles, including network security, administration, and covering transaction fees. Despite reaching an all-time high in 2021, MATIC’s value has plummeted by 80.85% and is currently trading at $0.56 in the market.
Consequently, many investors have opted to divest from MATIC and explore alternative opportunities such as newer layer 2 solutions like Optimism (OP), Arbitrum (ARB), and Base. This shift carries substantial obsolescence risks that could potentially exert further downward pressure on MATIC prices in the coming weeks.
Polygon 2.0 Upgrade and MATIC to POL Conversion:
Recently, the highly anticipated MATIC tokenomics change was unveiled as part of the Polygon 2.0 upgrade:
Polygon intends to rebrand the MATIC token as POL, which is poised to become the primary token within the Polygon ecosystem. POL will serve as the main currency and staking token for validating transactions on Polygon POS, Polygon zkEVM, and Supernets—a layer-2 solution built on the Polygon network. It will also function as a reward token on these networks.
The overarching goal of this upgrade is to expand the utility of MATIC/POL and enhance scalability while maintaining the overall security of the ecosystem.
The process of converting MATIC to POL is expected to be straightforward, with token holders only needing to send MATIC to a predefined smart contract to receive an equivalent amount of POL in a 1:1 ratio. The MATIC to POL conversion roadmap is anticipated to span four years.