Polygon Introduces Version 2 ‘Value Layer’ of the Internet Amidst SEC Scuffle
Polygon Labs, tje leading Ethereum layer-2 scaling solution, has revealed its ambitious plan for version two, a groundbreaking ‘Value Layer’ of the internet. This announcement arrives at a challenging time for Polygon as its native token faces regulatory scrutiny from the U.S. Securities and Exchange Commission (SEC).
On June 12, Polygon Labs introduced Polygon 2.0, envisioning it as the “Value Layer of the Internet.” While the internet primarily enables the creation of information, the Value Layer empowers individuals to generate, exchange, and program value, according to the company’s statement.
Polygon Labs emphasized that the Value Layer aims to democratize access to the global economy, stating,
“It is the missing piece of an Internet that serves users, not gatekeepers, rent-seekers, or middlemen.”
A Paradigm Shift towards Decentralization and Cross-Chain Powerhouse
Version 2.0 represents a comprehensive upgrade that aims to fundamentally transform nearly every aspect of the network. This includes protocol architecture, tokenomics, and governance. However, it is worth noting that Polygon’s current tokenomics heavily rely on venture capital, indicating that the project may not be as decentralized as it claims.
After more than a year of collaboration with developers, researchers, applications, node operators, validators, and the Ethereum community, Polygon Labs has finally culminated in this significant ecosystem upgrade.
The new iteration of Polygon introduces a network of zero-knowledge-powered layer-2 chains. These chains will be interconnected through an innovative cross-chain coordination protocol, enabling secure and instantaneous cross-chain interactions without the need for additional security or trust assumptions.
Updates on Proof-of-Stake and Token Structure, Amidst Regulatory Troubles
Polygon has outlined an ambitious roadmap, detailing upcoming updates to proof-of-stake, architecture, token structure, and governance over the next two months.
Meanwhile, Polygon finds itself under the regulatory spotlight in the United States. The SEC has designated its native token, MATIC, as a security as part of its ongoing crackdown on crypto exchanges. Polygon Labs vehemently refuted these claims, stating that both the network and token were developed and deployed outside the U.S.
As a result of the SEC’s actions, the price of MATIC has experienced a sharp decline, plummeting by 23% over the past week since the lawsuits were filed. Furthermore, the token has experienced a nearly 30% drop in value in the past two weeks.
At the time of writing, MATIC was trading at $0.643, representing a 2% increase for the day. However, the layer-2 governance token has lost all its gains since reaching a peak of $1.53 in February, sinking to its lowest level this year. MATIC’s value has fallen by 78% from its all-time high of $2.92 in December 2021.
The SEC’s classification of MATIC as a security has compelled major trading platforms, including Robinhood and eToro, to delist the token from their offerings.
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