MATIC, the native token of the Ethereum sidechain Polygon, has had it rough in the past five months. After soaring above $1.2 in March, the token has been in freefall, dumping over 65%. For now, MATIC faces strong rejection at $0.45 and continues to distribute, which is evident in the daily chart.
The lull across the crypto scene and shrinking activity in DeFi means Polygon is on the receiving end. Despite these market-related challenges, there is a silver lining for MATIC holders.
The Rebranding Of MATIC To Polygon
Polygon is evolving, and after the rebranding from the Matic Network, MATIC, the native token, will be relaunched as POL. This highly anticipated upgrade is set for September 4, 2024.
The rebranding will be a pivotal shift for Polygon, making a stage in which the platform introduces new utilities to POL as they look to grow and further innovate, primarily by scaling Ethereum.
In a post on X, Polygon said various changes would accompany the rebranding. If anything, the team plans to overhaul the current utility in MATIC and repurpose it to meet the needs of their grand plans from now on. After September 4, Polygon said POL would serve as an autonomous fuel, a change that could also support prices.
Under the new arrangement, POL will be crucial for ensuring Polygon is secure. The token will be distributed to validators as a reward for committing resources. The steady stream of rewards, Polygon said, would incentivize validators to commit even more resources.
At the same time, a portion of POL will be channeled to the Community Treasury. The funds will be used to super-charge development and research, with some allocated to the ecosystem initiatives.
The Grants Program And Polygon 2.0: Will It Revive Demand?
Polygon has activated the Community Grants program, dedicating 100 million POL per year for the next decade to spur development in the ecosystem. The objective is to catalyze growth and ensure the platform is secure.
The effort is part of the Polygon 2.0 roadmap, which aims to scale Ethereum further using zero-knowledge technology. Platforms launching as Ethereum layer-2s using the Polygon development stack will also receive liquidity from a unified source. At the same time, they will be interoperable with other layer-2s using the same stack since they are connected via the Aggregation Layer.
Despite all these efforts, only time will tell whether MATIC will inch higher. The local resistance is at $0.45. If broken, the token must be more than 2X before reclaiming March highs.
Feature image from iStock, chart from TradingView