summary: MATIC is an ERC-20 token that powers Polygon, a Layer-2 solution designed to scale the Ethereum network. It is used to govern and secure the network, as well as...
content: MATIC is an ERC-20 token that powers Polygon, a Layer-2 solution, designed to help scale the Ethereum network and improve its functionality. Overview MATIC is the native token of Polygon. It is used to govern and secure the network by staking. It's the currency of Polygon apps that enables users to interact with hundreds of decentralized applications involved in the Polygon ecosystem. !imageAs MATIC is an ERC-20 token issued on Ethereum, it can also be purchased using a variety of decentralized exchanges such as Uniswap and Sushiswap. In addition, a user can use the official Polygon Bridge in order to exchange assets between Ethereum and Polygon. MATIC acts as an economic investment to encourage users to contribute and participate in the Polygon ecosystem. It is used to pay validators as a unit of exchange, and active users who have contributed to the network will receive incentives in the form of this token. Consensus To take part in the consensus on the network, users must stake MATIC. The staked MATIC also serves as a form of punishment for malicious behavior, such as proposing invalid blocks, verifying blocks illegally, or executing invalid transactions, by requiring stakers to put up their stake as collateral. If a staker violates the network rules, their staked MATIC will be forfeited. Tokenomics There is a total supply of 10 billion MATIC tokens and, as of August 2022, over 7.4 billion have already been minted and released into the system. On January 18, 2022, Polygon went through the EIP-1559 upgrade, which introduced a deflationary effect on the token. As per the team, the MATIC tokens would go through annual burns that would remove 0.27% of the token’s total supply (about 27 million MATIC). Polygon held its initial exchange offering (IEO) on Binance using the Binance launchpad in April 2019. They were able to sell 19% of their tokens at a rate of $.00263/MATIC through this launchpad. Shortly after this IEO, Polygon held 2 additional funding rounds. The first was a seed round where they sold 2.09% of the total MATIC tokens at a rate of .00079/MATIC. The second was a token sale dedicated to early supporters, where 1.71% of MATIC tokens were sold at a rate of $.00233/MATIC. The total breakdown of the MATIC token supply is as follows: private sale (seed round + early supporters): 3.8% Binance Launchpad: 19% Team: 16% Advisors: 4% Staking Rewards: 12% Foundation: 21.86% Ecosystem: 23.33% !chart_showing_Breakdown_of_the_MATIC_token_supply.png Token Distribution The remaining 2.5 billion MATIC tokens that are not in circulation yet, will be distributed over the next 4 years through staking rewards. !chart_showing_Chart_X._Release_schedule_of_MATIC_tokens.pngRelease schedule of MATIC