EIP-1559 Upgrade Goes Live on Polygon’s Mainnet Network
Earlier this week, Polygon announced that the highly awaited EIP-1559 upgrade would go live today at 3 am UTC. The upgrade is meant to improve the burning of MATIC tokens and increase the gas fee visibility in the network.
EIP-1559 Upgrade Goes Live On Polygons Network
Polygon had revealed that the highly awaited EIP-1559 upgrade would go live today. It follows last year’s London upgrade of ETH that influenced ETH’s history. The upgrade is live on the Polygon mainnet after a successful upgrade on the Mumbai testnet and it became operational at 3 a.m UTC.
The upgrade replaces the first-price auction as the primary mechanism for a free calculation. It incorporates a discrete base fee for the transactions in the next block and a priority fee for faster processing. The base fee fluctuates depending on the network traffic and is later sent to the burn address.
The burning process of the Polygon Network has two steps that precede at Polygon network and completes in the ETH network. The Polygon DEV team has developed a public interface for users to monitor and actively engage in the burning process.
The upgrade does not lower gas fees since these fees are tied to the supply and demand of the coin. However, the upgrade allows users to estimate the transaction costs better since it offers a minimum price for inclusion in the next block. This functionality will also result in a few users overpaying the gas fees.
How the Upgrade Influences Polygon
The changes brought by the upgrade have radical effects for all Polygon stakeholders. The token holders will benefit from a deflationary effect caused by the burning since MATIC tokens have a fixed supply. The team claims that they used ETH’s London upgrade as their baseline in simulating the possible impact of the burn on the token’s supply. The analysis showed that the annualized burn would represent 0.27% of the total supply.
Dapp users and developers will also benefit from better predictability of gas fees. The upgrade will have fewer downsides for the users and developer since the new burn and gas fees curve is similar to ETH. Developers will also benefit from having their ETH tooling work seamlessly on the network with minimal adverse effects.
The deflationary functionality brought by the burning process will benefit both validators and delegators. This stakeholder category gets denominated rewards in MATIC, and the deflationary feature will directly affect their rewards. The gas fee will increase after a block is full, reducing spam transactions and lowering network congestion. As a result, validators won’t be getting the full fees but only the priority fees.
