In June 2023 Polygon Labs introduced Polygon 2.0, a series of upgrades that radically rethink almost every aspect of Polygon, with dedication to creating the “Value Layer of the Internet.” This includes upgrading Polygon's PoS to zkEVM Validium, implementing POL as an evolutionary native asset, creating new tokenomics, and implementing a new governance structure.
The community has debated upgrade proposals throughout the year. We saw the introduction of the Aggregation Layer, the unveiling of new tokenomics, and the launching of POL token contracts. One of the most anticipated milestones has now been achieved: on September 4th, 2024, MATIC will officially shift to POL.
As for MATIC delegators, no action will be required since staked MATIC will automatically be converted to POL on this date. Nevertheless, users might need to follow some specific instructions for an uninterrupted transition, which we will consider in this article.
What Is POL?
POL represents the third generation of native protocol assets, termed hyperproductive tokens. Unlike Bitcoin’s BTC, which is an unproductive asset, and Ethereum’s ETH, which allows holders to become validators and earn rewards, POL introduces two significant enhancements:
- Validators can validate multiple chains simultaneously.
- Each chain can offer multiple roles and corresponding rewards to validators.
These advancements secure and coordinate the Polygon ecosystem, facilitating unlimited growth opportunities for POL holders.
Major Benefits of POL for the Polygon Ecosystem
POL also introduces several advantages to the Polygon ecosystem alongside the redesigned protocol architecture.
- Security of the ecosystem. A decentralized pool of PoS (Proof-of-Stake) validators enhances security, resilience, and neutrality across all Polygon chains. Validators are incentivized to secure multiple chains, making the Polygon ecosystem more secure and robust through diverse participation.
- Unending scalability. POL can ensure that the Polygon ecosystem grows at an exponential rate until it becomes a mainstream industry. This allows for thousands of Polygon chains without compromising on security measures.
- Supporting the Ecosystem. The Polygon ecosystem and the industry in general are still in the early phases and will require ongoing support in years to come. POL can offer a sustainable, in-protocol mechanism for those activities.
- No friction. Blockchain protocols typically require users and developers to hold, stake, or use their own tokens to access the network. This requirement can cause friction and negatively affect the experience of both parties. POL is designed to eliminate this friction, allowing for smoother, more efficient operation.
- Ownership by the community. POL empowers the community with governance rights, reinforcing Polygon’s commitment to decentralization and community-driven management.
Detailed Migration Guide
As the date for the MATIC to POL migration approaches, it's essential to understand the steps involved and what you need to do based on where you hold your MATIC tokens. Here’s a comprehensive guide to help you smoothly navigate this transition.
MATIC Stakers/Delegators on Ethereum
Here’s what you need to know and do to be ready for the upgrade:
- Review PIP-42. This proposal contains additional information about the staking upgrade for Polygon PoS.
- Automatic Conversion. On September 4th, all staked MATIC will be automatically upgraded to POL. If you do not want your staked MATIC to be upgraded, you need to unstake it on Ethereum before September 1st. Note that there is a 48-hour withdrawal period, so plan accordingly.
- Staking Rewards Continuity. Staked tokens will continue to earn rewards post-upgrade.
- Full Backwards Compatibility. Existing functions for staking and unstaking MATIC will remain, with new functions added for staking POL. The unified staking reserve will be in POL.
MATIC Holders on Polygon PoS
No action is required. On September 4, 2024, all MATIC tokens on the Polygon PoS chain will automatically migrate to POL tokens. If you don’t update RPC settings in a wallet, the wallet may still display “MATIC” instead of “POL” as the token symbol for the native gas token for the Polygon PoS chain.
MATIC Holders on Ethereum
If you hold MATIC tokens on Ethereum, there are two main ways to upgrade to POL.
Using the Migration Contract. To upgrade your MATIC tokens to POL, you can use the migration contract available on Etherscan. This process is straightforward and designed to facilitate an easy transition.
Using DEX Aggregators. Suppose you prefer not to interact directly with the migration contract or lack the technical knowledge. In that case, you can use a third-party decentralized exchange (DEX) aggregator such as 1inch, Kyber, or CowSwap. These platforms have integrated the migration contract, allowing you to upgrade your tokens easily. Review the terms and conditions on these dApps to understand the migration process fully.
Tips for Liquid Staking Token Holders
If you hold liquid staking tokens, you should be aware of the following tips:
- Liquid Staking Programs. Different programs may have varying processes and timelines. Be aware of potential temporary suspensions of issuances and redemptions around the upgrade date to allow for the MATIC to POL transition.
- Program-Specific Information. Each liquid staking program operates differently, so it’s essential to identify the specific information relevant to your program for tailored instructions.
MATIC Held on Centralized Exchanges (CEXes)
Review any FAQs and guidance provided by your centralized exchange (CEX) to understand their specific process for MATIC to POL migration. Most major exchanges will likely handle the technical upgrade for their users automatically.
MATIC Holders on zkEVM
For users holding MATIC tokens on zkEVM, you have two primary options to upgrade to POL.
- Bridge to Ethereum. Bridge your MATIC tokens from zkEVM to Ethereum, and then follow the instructions for MATIC holders on Ethereum to upgrade to POL.
- Swap on zkEVM DEX or Aggregator. Alternatively, you can use a zkEVM-based DEX or aggregator to swap MATIC for POL.
MATIC Held in Smart Contracts on Polygon PoS
Contract owners or users need not take action. MATIC tokens held in smart contracts on Polygon PoS will be upgraded to POL on September 4, 2024.
MATIC Held in Smart Contracts on Ethereum
You must manually make this transition if you hold MATIC tokens in Ethereum smart contracts.
- Migration Contract. Users must manually interact with the migration contract to upgrade their MATIC tokens to POL. This can be done via Etherscan Migration Contract.
- Contract Updates. Developers should consider updating smart contracts to use POL instead of MATIC. This may require redeploying the contracts or making updates to ensure compatibility with POL tokens.
MATIC Held in smart contracts on zkEVM
If you hold MATIC tokens in zkEVM smart contracts, you must manually update POL.
- Manual Update. Users need to manually update MATIC tokens stored in zkEVM smart contracts. This can be done by exchanging tokens with a DEX or a zkEVM-based aggregator. Alternatively, users can bridge their MATIC tokens into Ethereum and monitor the migration process using an Ethereum migration contract.
- Contract renewal. Developers should update zkEVM smart contracts to support POL. This may involve changing the contract code to ensure compatibility with the POL token standard.
Last words
Polygon 2.0 represents a significant step forward for the Polygon ecosystem, introducing the POL token for improved security, scalability, support, user experience, and community management. As we approach the transition date of September 4, 2024, all MATIC owners need to understand their specific steps to ensure a smooth transition to POL.
Regardless of how you store your MATIC, following these instructions will allow you to easily upgrade to POL and fully take advantage of Polygon 2.0's new features and benefits.
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