Polygon 2.0 is crypto’s ‘most relevant technical announcement’: FalconX
Polygon is making up for poor year-to-date performance with a July rally, as markets appreciate its upcoming network upgrade
Dennis Diatel/Shutterstock modified by Blockworks
Polygon (MATIC) is mounting a comeback this month following a poor showing throughout most of the year.
The native token for the popular Ethereum scaling network was up 12% in July as of Tuesday afternoon. Bitcoin (BTC) was about flat and ether (ETH) had dropped 3.2%
Cryptocurrencies tied to layer-2 solutions Arbitrum (ARB) and Optimism (OP) had respectively sunk 3.5% and 8.9% over the same period.
MATIC’s comparatively strong performance could stem from speculation about a major network update, Polygon 2.0, according to a FalconX research note.
“The Polygon upgrade is the most relevant technical announcement in the industry at the moment,” David Lawant, the firm’s head of research, said.
“We expect MATIC to keep closing its gap versus peers as more details of the upgrade roadmap become more apparent to the market.”
The update is labeled a “vision for unlimited scalability and unified liquidity, powered by Zero-Knowledge technology,” per the project’s roadmap.
Polygon Labs, the primary studio behind Polygon, collaborated with developers, researchers, node operators, validators and other stakeholders as part of its process.
Polygon 2.0 is expected in a number of phases with the first geared towards establishing what’s dubbed a “value layer,” mirroring how the “rest of the internet operates.”
Architectural overhauls, including a validium, are intended to reduce costs and boost transaction throughput. There’s also plans to revamp tokenomics and governance processes, FalconX noted.
Zooming out, though, and MATIC still has a ways to catch up.
Despite outperforming most of the market directly following the FTX scandal last November, MATIC is down 3.2% over the year to date, underperforming against BTC, ETH, ARB and solana (SOL), all of which are up more than a third.
Get the news in your inbox. Explore Blockworks newsletters:
- The Breakdown: Decoding crypto and the markets. Daily.
- Empire: Crypto news and analysis to start your day.
- Forward Guidance: The intersection of crypto, macro and policy.
- 0xResearch: Alpha directly in your inbox.
- Lightspeed: All things Solana.
- The Drop: Apps, games, memes and more.
- Supply Shock: Bitcoin, bitcoin, bitcoin.
