A new proposal to overhaul Polygon\u2019s tokenomics is gaining momentum on the project\u2019s governance forum and across social media, as investors voice frustration over POL\u2019s steep underperformance compared to the broader crypto market.<\/p>\n
The proposal<\/a>, authored by activist token investor Venturefounder, calls for major revisions to Poilygon\u2019s (POL<\/a>) supply model, including the elimination of its 2% annual inflation rate and the introduction of a treasury-funded buyback or burn program to reduce ongoing sell pressure.<\/p>\n \u201cThese changes are intended to align the supply dynamics of POL with its current technological and strategic reality, reinforce investor confidence, and prevent further token devaluation and network stagnation,\u201d Venturefounder wrote in the forum post.<\/p>\n Under the current model, Polygon\u2019s 2% annual inflation adds roughly 200 million new POL tokens to the market each year \u2014 a factor the author argues has created persistent downward pressure on price. The proposal suggests either moving to a 0% inflation target to establish a fixed supply or adopting a tapering schedule, reducing inflation by 0.5% per quarter until it reaches zero.<\/p>\n The author cites BNB (BNB<\/a>), Avalanche (AVAX<\/a>) and Ether (ETH<\/a>) as examples of tokens that have benefited from deflationary or fixed-supply models<\/a>, arguing that a similar approach could strengthen POL\u2019s value proposition.<\/p>\n The proposal follows a widely circulated manifesto posted by Venturefounder on X, which has garnered over 25,000 views. In that post, the investor described POL\u2019s 46% decline over the past year, and its current trading level below 2022 bear-market lows, as \u201cinexcusable\u201d during what many consider a crypto bull market led by Bitcoin (BTC<\/a>) and Ether.<\/p>\n \u201cThese excuses are NOT VALID,\u201d Venturefounder wrote. \u201cThere is nothing wrong with the market, there is something SERIOUSLY wrong with POL, and it\u2019s DOWN BAD.\u201d<\/p>\n In addition to the inflation issue, the manifesto criticized a series of strategic missteps by the Polygon team since 2022, while urging more transparent communication and faster delivery of key infrastructure like Agglayer<\/a>.<\/p>\n The proposal has drawn positive engagement from within the Polygon ecosystem. Brendan Farmer, Polygon co-founder, reacted to the discussion, and\u00a0 Polygon Labs CEO Marc Boiron<\/a> acknowledged the proposal on social media.<\/p>\n The forum thread remains open as community members debate the feasibility of funding validator rewards without inflation, the sustainability of buybacks and the overall impact on network security.<\/p>\n Related: <\/strong><\/em>Polygon says blocks still running despite consensus bug disruption<\/strong><\/em><\/a><\/p>\n Once one of the most highly touted Ethereum scaling solutions, Polygon built its reputation on strong technical innovation, from its zkEVM rollout to the ambitious AggLayer framework designed to unify multiple chains. Yet despite these advancements, investor confidence has waned, and competition from newer layer-2 ecosystems such as Arbitrum, Optimism and Base has intensified.<\/p>\n In 2024, Polygon began migrating its native token<\/a> from MATIC to POL as part of a broader governance and tokenomics overhaul intended to enhance community participation and secure the network. The transition introduced a 2% annual emissions<\/a> schedule to fund validator rewards and ecosystem incentives. <\/p>\n Despite its recent struggles, Polygon retains a strong developer community, particularly among builders seeking technical maturity and enterprise-grade infrastructure.\u00a0<\/p>\n As Cointelegraph recently reported<\/a>, citing a study across Mexico, Brazil, Peru and Bolivia, Latin American developers continue to favor Polygon and Ethereum over newer protocols for deploying decentralized applications.<\/p>\n Polygon has also doubled down on the tokenization of real-world assets (RWAs). In a recent example, AlloyX, a tokenization infrastructure provider, launched a tokenized money market fund on Polygon<\/a>. This growing RWA activity has helped fuel broader onchain engagement, including a milestone where Polygon\u2019s NFT sales surpassed $2 billion<\/a>.<\/p>\nPolygon faces confidence challenges as competition intensifies<\/h2>\n