As Polygon 2.0 goes live on testnet, here’s how MATIC responded

• The first steps of the new proposed governance for Polygon 2.0 will be shared soon.
• MATIC was up by more than 10% over the last seven days, and most metrics were bullish.

Polygon [MATIC] recently announced an update that will play a crucial role in shaping the blockchain’s future. The development was related to the much talked about Polygon 2.0 upgrade, which will also change MATIC’s fate when it’s launched fully. In fact, MATIC’s price action has already turned bullish in the recent past, thanks to the market condition.

Polygon 2.0 is now live

Polygon Labs revealed in its latest tweet that, as a result of community consultations, POL contracts will be live on the Goerli testnet.

POL contracts have been deployed on the Goerli testnet, and two proposals setting forth potential changes to the native token burning mechanism necessary for future upgrades went live as well.

Today, as a result of community consultations, POL contracts will be live on Goerli testnet.

A major step towards bringing Polygon 2.0 to life.

Based on the community’s feedback during the PIP governance process, PIP-24: Change EIP-1559 Policy & PIP-25: Adjust POL Total Supply,… pic.twitter.com/li8OF0o3jC

— Polygon Devs 📍 DevX Global Tour (@0xPolygonDevs) October 4, 2023

For starters, POL is the blockchain’s next step in revamping MATIC. It will accommodate an ecosystem of zero knowledge-based Layer 2 chains by enabling staking, community ownership, and governance.

As per the official announcement, the PIP governance process also resulted in the release of PIP-24: Change EIP-1559 Policy and PIP-25: Adjust POL Total Supply, which were both based on community feedback.

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The blockchain stated that in the coming weeks the first steps of the new proposed governance for Polygon 2.0 will be shared, the core of which will be a new Ecosystem Council composed of thought leaders and technology experts.

MATIC’s response is optimistic

MATIC’s reaction to the latest development looked positive as it managed to sustain its upward trend. According to CoinMarketCap, MATIC’s value surged by more than 10% last week. In fact, in the last 24 hours alone, the token’s price surged by 1.1%.

At the time of writing, MATIC was trading at $0.5611 with a market capitalization of over $5.2 billion. While the price surged, MATIC’s trading volume also increased, which is typically a positive development. Thanks to the price uptick, MATIC’s 1-week price volatility spiked last week.

MATIC remained popular in the crypto space last week, which was evident from its high social volume. However, a bearish signal was Polygon’s Binance Funding Rate, which turned red.

This suggested that derivatives investors were not buying MATIC at a higher price, which can cause a drop in its price. As per CryptoQuant, MATIC’s Exchange Reserve was increasing, meaning that the token was under selling pressure.