Polygon ($MATIC) Transactions Plunge as its Price Jumps 20%
The Polygon (MATIC) network has increased its transaction fees 30x from a default value of 1 gwei to a minimum value of 30 gwei, according to a post published by Polygon co-founder Sandeep Nailwal suggesting the move was necessary to deter spam transactions on the network.
The move sparked criticism among the cryptocurrency’s community, as members questioned why the move was applied without notice to most users and whether any feedback was collected before the move went ahead.
Some even questioned the network’s decentralization as the change was made rather quickly. One user said he was “interest in knowing how consensus is reached on these decisions.”
Nailwal responded to the community saying the change was “recommended to reduce the spam transactions in the network,” before adding that as it’s a “client-level configuration you are free to run your node with old/different settings as per your wish.”
As transaction fees on the network rose, transactions seemingly plunged. Polygonscan data shows that in May of this year the network’s adoption surged to surpass 8 million transactions per day, and that it has been averaging over 6 million over the last few weeks.
The update saw daily transaction volumes plunge to less than 3 million:
In response to the move, some developers revealed they were considering moving their projects to other protocols, with one noting that the cost for minting NFT tickets suddenly rose by a factor of 30.
Another user pointed out that Polygon “ is already facing fierce competition from other cheap L1 chains like SOL, AVAX, and soon ADA.” They added that making interacting with its decentralized applications 30 times more expensive would see “Polygon instantly lose it’s [sic] edge.”
Despite the controversy, the price of MATIC surged over the last 24-hour period, going from $1.25 at the beginning of the day to over $1.52 at press time, according to available data.
The cryptocurrency’s price is seemingly rising after being listed on the popular South Korean cryptocurrency trading platform Upbit. Its move up comes as the flagship cryptocurrency bitcoin surged to $59,000 on rumors the U.S. Securities and Exchange Commission (SEC) will soon allow a Bitcoin ETF to trade.
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