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Wednesday, March 22, 2023

Ethereum Launches Upgrade On Polygon

The upgrade of Ethereum which was introduced as a partial network fee burning mechanism has been launched on Polygon, the layer-two scaling network. The EIP 1559 upgrade was shipped with its London hard fork the previous summer and has been quite a major success in terms of the predictability in its gas price and the network fee burning.

The upgrade has also been launched on Polygon in an effort to improve the visibility of its fees. It went live at block 23,850,000. The team from Polygon announced the date of the upgrade on Monday, following the successful deployment on the Mumbai testnet. 

Ethereum’s Protocol Has been launched on Polygon

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The Ethereum-1559 upgrade does introduce the same fee-burning mechanism to Polygon, which would result in the destruction of MATIC tokens. It also manages to remove the first-price auction method which is used for the calculation of network fees, something that leads to better cost estimations but does not, under any circumstance, reduce the price of gas. The burning is simply a two-step affair that begins on the network of Polygon and completes on the network of Ether. 

The team further stated that, just like the protocol of Ethereum, the supply of MATIC was also pretty likely to become deflationary with 0.27% of the total supply being burnt every year, as stated by calculated estimations. There is currently a fixed supply of 10 billion MATIC tokens with 6.8 billion currently under circulation. It also added that the deflationary pressure would definitely benefit both validators and delegators because their rewards for processing transactions are denominated in MATIC. 

Ever since the protocol went live on Ethereum six months back, the upgrade has mostly resulted in the burning of around 1.54 million ETH to date, according to Ultrasound.money. At the current prices of ETH, this works the entire sum at $5 billion.

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