Polygon is positioning itself for the upcoming cryptocurrency bull market through an aggressive POL deflationary strategy. In a Friday post on X, Polygon Foundation CEO Sandeep Nailwal revealed that the project plans to permanently burn 100 million POL tokens, pointing to strong protocol revenue.
“Polygon is printing revenue. $24.5m YTD. We are deploying a change that lets anyone in the community trigger its burn,” Nailwal stated. He added that the proposal is currently pending final approval from the Security Council before deployment, after which manual quarterly burns will take place.
Polygon’s base fees continuously add POL to its collector wallet. Nailwal reported that this collector currently holds 121 million POL, valued at roughly $1.2 million. Executing the planned burn of 100 million tokens will eliminate 1% of the total circulating POL supply from the market.
Can these burns drive up the value of POL? Polygon has strategically pivoted toward payment processing, with a particular emphasis on stablecoin-based transactions. According to Nailwal, current network traction and fee generation are now three times higher than Arbitrum and five times higher than Near Protocol.
Data from DeFiLlama confirms that Polygon’s annual collected revenue has surpassed $25 million, hitting a two-year peak. Nevertheless, it remains to be seen whether this momentum will persist in the months ahead and sustain ongoing POL burn rates.
Meanwhile, the announcement of the 100 million token burn triggered a 10% price increase for POL. The altcoin previously jumped 80% from $0.07 to $0.11 during the third quarter prior to a steep correction in late August. Throughout September, the asset consolidated above the $0.09 support level, which also aligns with its 200-day Moving Average.
Friday’s price surge contributed to a broader weekly recovery of 20% as Bitcoin surpassed the $80,000 threshold, with the 100-million-token update further fueling the upward momentum. Additional recovery room may still exist for POL, given that the daily Relative Strength Index (RSI) had not yet reached overbought levels at the time of publication.
Frequently Asked Questions
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How many POL tokens are slated to be burned?
The Polygon Foundation plans to permanently burn 100 million POL tokens.
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What is driving the burn initiative?
The deflationary plan is backed by strong protocol revenue, with Polygon generating $24.5 million year-to-date and annual collected revenue crossing $25 million.
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How will the burns be executed?
A community-triggered burn mechanism is awaiting final sign-off from the Security Council, which will be followed by manual quarterly burns.
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What percentage of the circulating supply will be removed?
Burning 100 million tokens will remove 1% of the circulating POL supply from the market.
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How did the market react to the announcement?
The price of POL surged by 10% following the burn update, contributing to a 20% weekly recovery gain.