The development team behind Polygon (MATIC) has proposed the implementation of an EIP-1559 on its network as soon as it’s implemented on the Ethereum blockchain with the London Network Upgrade.
Polygon (MATIC) Plans to Implement EIP-1559 On Its Network
The development team behind Polygon, a layer 2 solution of Ethereum (ETH) has announced on implementing a revised version of an Ethereum Improvement Plan (EIP-1559) on its network following the proposal is implemented in the next London hardfork.
Proposal for implementing EIP-1559 on Polygon is open for discussion on the forum https://t.co/SlN5xWT3dA
— Polygon (@0xPolygon) June 19, 2021
For the implementation of the EIP 1559 on the Polygon network, there won’t be any burning of base fees since MATIC has a fixed supply.
According to the team, instead of burning the base fee, it would be sent to the core contract account where Polygon’s DAO (Autonomous Decentralized Organization) would let the community deliberate on what to do with it.
The deposit of funds into the new contract proposed by the Polygon team is similar to the future payment strategy for validators. Meanwhile, any sort of deflationary mechanism would mean restructuring payouts.
This will allow DAOs to spend money on improving and maintaining the network, bringing long-term benefits to all validators.
Generally, EIP-1559 on Ethereum introduces a base fee that will be burnt with each transaction, alongside a priority fee that incentivizes miners to process each transaction.
Restructuring Ethereum’s Improvement Proposal
Currently, Ethereum has a no-issuance limit, the issuance limit for Polygon’s MATIC token is set at 10 billion MATIC. Since MATIC has a fixed supply, burning for each transaction will theoretically be zero. Hence, it’s necessary to restructure the method of paying compensation.
EIP-1559 is a proposal that intends to improve Ethereum’s transaction fees with the current auction method to be changed from the standardized fee for the entire network to the method set by the algorithm.
Polygon has soared more than 140 times since the beginning of the year when it hit a record high of $2.62 last month to currently trading at $1.31, at the time of writing.