$MATIC pumps following Polygon’s proposed token upgrade

$MATIC jumped by more than 7% in 24 hours today, hinting the start of a bullish momentum for the coin. This seemed to be triggered by an announcement issued regarding an update of the Polygon network’s upgraded token ‘POL’.

In a post made on X (formerly Twitter), Polygon founder Sandeep Naiwal heralded POL as a “massive technical upgrade” to the $MATIC token. It comes with the benefits of multi-chain staking without the added risks of restaking.

Back in July 2023, Polygon revealed its plan to replace the existing token POL in its Polygon 2.0 tokenomics model announcement. This sought to establish POL as the exclusive token for all networks within the Polygon ecosystem.

“With the Polygon 2.0 proposal, the Polygon Ecosystem will expand from a single chain to an ecosystem of L2s that can easily interoperate and share liquidity with each other”, said Naiwal as he talked about the upgrade yesterday.

Here, Polygon POS will become an L2 in Polygon’s network of zk-powered L2s. This will allow validators to secure the hub, run provers to generate proofs, and batch transactions as a sequencer. Therefore, with the increased number of roles for the validators, there is a need for a new token design to power the network.

In this background, POL will be staked in the staking hub in Polygon 2.0. The token can also be restaked to validate any number of chains on the network in a new approach that is called “enshrined restaking”.

As a result, POL can natively be used to stake any number of chains and participate in any number of roles. This would efficiently let stakers earn higher rewards with the same staked capital.

According to the top executive, Polygon is in the process of building POL from the ground up to become the first hyperproductive token and a third generation token in design.

He then explained how Generation 1 is Bitcoin, which provides no mechanism for holders to play a role in network security. Generation 2 is Ethereum, which lets holders stake to secure the network. As declared by Naiwal, POL would be Generation 3 of tokens which would allow holders to secure several networks and perform multiple roles.

Back in July, $MATIC’s price had benefited from the first announcement about the rollout of Polygon 2.0. During this time, it was also facing allegations by the United States Securities and Exchange Commission (SEC) for being an unregistered security.

However, the recent announcement has positively affected the price of Polygon’s current token $MATIC, taking it to trade in the green on its charts. Changing hands for $0.592, the coin has been up by more than 10% in the last seven days.