Polygon launches Ethereum EIP-1559 upgrade to burn MATIC

The layer-two scaling network Polygon has deployed the Ethereum upgrade that introduced a partial network fee burning technique in August 2021.

Last summer, Ethereum released the EIP-1559 upgrade with its London hard fork, which has proven to improve network fee burning and gas price predictability. The upgrade is already live on the layer-two scaling network Polygon, with the goal of improving “fee visibility.” It became online at block 23850000 on Tuesday.

After its effective delivery on the Mumbai testnet, the Polygon team announced the upgrade date on Jan. 17.

Polygon aims spam reduction

Polygon receives the same fee-burning mechanism with the EIP-1559 upgrade, leading to the destruction of MATIC tokens, which means supply cap. It also removes the first-price auction approach of determining network fees, which improves cost estimates but does not lower gas prices, the team stated:

“The burning is a two-step affair that starts on the Polygon network and completes on the Ethereum network.”

According to the developers, MATIC’s supply is anticipated to become deflationary, with 0.27% of the overall supply being burned every year, similar to Ethereum. The token supply in circulation for MATIC is around 10 billion MATIC, with 6.8 billion actively in use.

“Deflationary pressure will benefit both validators and delegators because their rewards for processing transactions are denominated in MATIC,” the team continued before adding that the update would also help in reducing spam and network congestion.

Polygon just experienced its own gas shortage despite being a layer-two network. According to Dune Analytics, Polygon gas fees increased earlier this month, causing some validators to be unable to submit blocks. The growth of the market was sparked by Sunflower Land, a DeFi yield farming game that rewarded early buyers before the degens lost interest.

The data by burn tracker, Ethereum has burnt around 1.54 units (around $5 billion as per current market movement) since the update six months back. As TheCoinRise reported, Binance Coin also recently changed its burning program mechanism by making it automatic rather than quarterly.