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Polygon (MATIC) Set to Become Deflationary with EIP 1559 Deployment -Breaking

by Mike Robinson

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The EIP1559 Deployment of Polygon (MATIC), Sets Polygon (MATIC), to Be Deflationary

Ethereum’s internet of blockchains, Polygon, has established itself as a leading layer 2 scaling solution with its innovative technology. Polygon’s drive to offer the best has seen the project announce the deployment of EIP-1559 on its network.

Polygon finally announces that after a month-long wait, the long-awaited Improvement Proposal 1559 (EIP 1559) will be live on the mainnet at 8 am (UTC) on January 18.

What is the Impact of EIP-1559 on Polygon

EIP-1559, which was introduced via London Hardfork to Ethereum in August 2021 will abolish the primary gas fee.

On the Polygon network people place bids to purchase their transactions. The highest bidder wins. All transactions within a block will be subject to a flat fee due to the network upgrade. However, users can add a “tip” to prioritize their transactions.

Upgrades will reduce spam transactions and network congestion. Once the block has been filled, the base fee will automatically increase.

In addition, it will also introduce token burning for MATIC – making it a deflationary asset. Burning refers to the intentional destruction/removal of a token from circulation – thus reducing the amount available to users.

According to the Polygon team, MATIC’s fixed supply of 10 Billion would decrease by 0.277%, or 27 Million MATIC per year.

Flipside

  • While EIP-1559 would benefit all of Polygon’s stakeholders, it would reduce the amount of MATIC available to existing and new investors.

What You Need to Care About

EIP-1159 upgrades will make it possible for validators, dApp users and delegate on the network to pay significantly lower transactions fees.

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