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Key Takeaways
With positive news emerging about XRP in relation to the securities issue, the market capitalization of MATIC tokens also bounced back.
The statistical metrics of Polygon zkEVM show a consistent upward trend.
The new $POL tokenomics and governance framework of Polygon 2.0 have been unveiled.
Various projects, including IDEX and PALM, have announced plans to build zk L2 through Polygon Supernets.
1. Key Metrics
For July, various metrics of the Polygon PoS network have significantly improved as the market situation has improved. The number of daily transactions and the number of daily active addresses have increased, but on the contrary, TVL and network fees have decreased. In terms of market capitalization, there was a sharp drop in June, followed by a sharp rebound in July, due to the token's securities issue. In June, when the SEC sued Coinbase and Binance, the MATIC token was included among the tokens that were claimed to be securities by SEC, leading to a significant drop. However, in July, positive news in the XRP lawsuit led to a rebound in the MATIC token as well. As Polygon zkEVM is still in its early stages, the statistical metrics of Polygon zkEVM are showing a consistent upward trend.
2. Updates & News
2.1 Technical
Polygon ID announced two updates: Schema Builder & Query Builder
An interactive Polygon zkEVM app dashboard has launched on the Near BOS
2.2 Companies & Institutions
Etihad Airways launched a new NFT on Polygon PoS with Arcube
Ferrari worth $2.5M has been successfully sold on Polygon PoS
Italy’s central bank taps Polygon to help institutions dabble with tokenized assets
2.3 Ecosystem
IDEX launched XCHAIN Testnet, a zkEVM L2, as one of the first Polygon Supernets
Polygon Labs has formed a strategic alliance with Ondo Finance
AMGI Studios has committed to launching exclusively on Polygon for 12 months
PALM will upgrade the Palm Network into a zk L2 by becoming a Polygon Supernet
3. Featured Topics
3.1 New Tokenomics: $POL
On July 13, 2023, Mihailo Bjelic, Sandeep Nailwal, Amit Chaudhary, and Wenxuan Deng proposed a new tokenomics, $POL, to the Polygon community. If the proposal is approved, the POL token will replace the existing MATIC token. The utility of POL tokens is expected to be used for transaction fees, validator staking and rewards, and governance.
The main differences compared to the existing MATIC tokenomics are as follows:
Inflation - An inflation equivalent to 2% of the total supply of existing tokenomics is added. For the initial ten years, 1% is provided to validator rewards and 1% to the newly established community treasury. After ten years, the inflation rate can be reduced through governance.
Community Treasury - The community treasury can be utilized to support the ecosystem through community governance.
In the new tokenomics, validators can receive additional rewards and transaction fees from the participating supernets in addition to inflation rewards. The community treasury can support the ecosystem, and users can participate in decentralized governance through tokens, which is expected to make the Polygon ecosystem more decentralized and sustainable than before.
3.2 Polygon 2.0 Governance
On July 19, 2023, the governance model to be used in Polygon 2.0 was revealed. Governance in Polygon 2.0 is divided into three main parts:
Protocol Governance - This is decentralized governance related to the maintenance and development of the Polygon technology stack, consisting of 1) the Polygon Improvement Proposal (PIP) framework and 2) various community initiatives to activate PIP (including bounty programs and hackathons).
System Smart Contract Governance - This is decentralized governance concerning upgrading protocols implemented as smart contracts on the Ethereum network. Upgrades can be proposed through PIP, and initially, the execution of upgrades is supervised by the Polygon Ecosystem Council, which consists of 12 members.
Community Treasury - This is decentralized governance related to managing the community treasury for the sustainability of the Polygon network. Initially, it will be managed by a selected group of people called the Community Treasury Board, and it will gradually encourage wider community participation.
The governance of Polygon 2.0 is clearly delineated into relevant sectors, and its progressive move towards greater decentralization is expected.
4. Recommended Reads
10 Real World Examples of Blockchain Use in the Public Sector - This article introduces how the Polygon blockchain is used in the public sector, including the news that the Singapore government and JP Morgan piloted DeFi on Polygon.
The Bank of Italy’s Milano Hub Selects Cetif Advisory's Institutional DeFi for Security Token Ecosystem Project on Polygon - Milano Hub, the innovation center of the Bank of Italy, is collaborating with Polygon Labs, Fireblocks, Reply, Linklaters, DVRS, etc. for the security token project for Institutions, allowing institutions to interact safely with DeFi under regulatory compliance.
Polygon Miden: Asset Model - Polygon Miden is expected to launch its public testnet in Q4 of this year. This article discusses how the asset model in Polygon Miden differs from the Ethereum network and presents a new approach.
Polygon 2.0: A New Blueprint for Mass Adoption - This covers the architecture of Polygon 2.0.
Polygon zkEVM Ecosystem: Slow but Steady - This is an article where you can take a general look at the Polygon zkEVM ecosystem.
Thanks to Kate for designing the graphics for this article.
