The Polygon team revealed today that Ethereum Improvement Proposal (EIP 1559) is going live on the Polygon blockchain protocol. With the upgrade, the supply of MATIC becomes deflationary, which means that through burning, coins will be removed from circulation. Also, the step improves fee visibility.
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Folks, #EIP1559 is a few hours away from going live on the #Polygon mainnet.
— Polygon | $MATIC 💜 (@0xPolygon) January 17, 2022
The highly-anticipated upgrade brings $MATIC burn and improved fee visibility.
Find out more: https://t.co/7fRxSZIrdv
Otherwise known as London hard fork, the upgrade was launched on Ethereum's mainnet in August 2021. After its launch on the Mumbai testnet, Polygon developers are going to release EIP 1559 on the mainnet on Jan. 18. The fork changed the fee calculation method of the network, bringing the base fee system. According to it, fees are set automatically, and are determined by the activity level of the protocol.
There's also a priority fee to accelerate the speed of operations.
The network burns the base fee. Polygon will carry out burning via a two-step structure. The process starts on Polygon and completes on Ethereum.Via a public interface, users can track and participate in token burning. In the release, Polygon mentioned that the upgrade doesn't reduce fees as the amount depends on supply and demand, but it makes costs more predictable and prevents overpaying. as the base fee is the minimum price for the approval of a transaction.
MATIC has a max supply of 10 bln coins. According to estimations, around 0.27% of the supply will be burned yearly.
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At the moment, MATIC trades at around $2.2. It's the 13th largest cryptocurrency with a market capitalization of over $16 billion.