On Thursday, the Polygon Foundation announced the date for its upcoming upgrade from MATIC to POL after reaching community consensus. The long-awaited token migration will take place in less than two months and is intended to kickstart Polygon’s native token expansion. MATIC saw a 7% drop following the news.
Related Reading
Save the Date: Polygon Token Update Coming Soon
Layer-2 scaling solution for Ethereum, Polygon, has revealed the highly anticipated date for its native token upgrade. Set for September 4, the initial phase will begin with the migration of the MATIC token to POL.
According to the announcement, POL will initially replace MATIC “as a native gas and staking token for Polygon PoS.” The upgrade was rolled out on the testnet on July 17 to “serve as a dress rehearsal” to identify and fix potential issues before the mainnet migration.
Upgrading Polygon PoS from MATIC to POL is a significant undertaking that requires the highest possible security, including robust testing. (…) A testnet migration allows users, developers, and infrastructure providers to familiarize themselves with the upgrade processes, ensuring technical validation and minimizing disruptions during the mainnet upgrade.
During subsequent phases, the POL upgrade aims to expand Polygon’s utility as an aggregated blockchain network, providing security and “unifying liquidity and shared state across multiple chains.”
According to the post, some MATIC holders may have to take certain actions to migration depending on where they hold their tokens. POL will be automatically upgraded for MATIC holders on Polygon PoS and no action will be required.
Meanwhile, action is required for users of Ethereum, Polygon zkEVM or centralized exchanges (CEXes). These holders will have to upgrade to POL via a token migration contract.
MATIC drops 7%, will it be $0.4 or $1 next?
Following the news, Polygon’s native token suffered a price drop of around 7%. The token, which was trading at $0.54 at the time of the announcement, fell to the $0.52 price area within the next 2 hours.
MATIC Price knocked down to the $0.51 support zone, currently oscillating between the $0.513 and $0.518 range. This performance represents a 4% retracement on the monthly chart. However, the token shows green numbers on the weekly and biweekly intervals, with an increase of 2%. In addition, MATIC records a 34% increase in its daily activity, with a daily trading volume of $374.7 million.
Some market observers have mixed opinions on the performance of Polygon’s native token. Crypto analyst The Cryptonomist shared a bearish prediction for MATIC in a post X.
According to the post, the analyst highlighted that MATIC had a “nice breakdown” from a “large ascending wedge with major TF resistance.” This suggested to the analyst that the token will continue to fall even if a retest is possible. As a result, she suggested a price target of $0.4.
Meanwhile, Zayk charts stated that MATIC was moving within a falling wedge pattern on the macro chart. The analyst considered that a breakout of the bullish pattern could fuel a rally towards the $1 price range.
Related Reading
Crypto analyst Alex Clay calls MATIC a “generational fund.” Clay highlighted that the token has seen a 20,000% return following its previous 630-day channel accumulation.
The analyst believes that MATIC’s current 1,218-day accumulation within a symmetrical triangle could lead to double-digit price targets. His forecast includes hitting the $4.5, $7.1, and $9.75 resistance levels before reaching a double-digit target.
Featured image from Unsplash.com, chart from TradingView.com