Polygon crisis: How project tries to regain lost ground

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Polygon struggle to rebuild trust and relevance

Birth and rise to the top

Polygon began as a story of ambition. In 2017, three engineers from India founded Matic Network — a project meant to solve Ethereum’s biggest problem: slow and expensive transactions.

It wasn’t just another blockchain; it was a bridge between the old and the new — a solution that could scale Ethereum without compromising security. Over time, Matic evolved into Polygon — a full ecosystem with its own infrastructure, decentralized applications, NFTs, DeFi, and enterprise-grade projects.

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A major breakthrough came with the launch of Polygon zkEVM — a zero-knowledge proof–based technology that allowed thousands of transactions to be verified within a single proof on Ethereum.

This innovation brought Polygon recognition as a technical leader among Layer-2 platforms and helped it secure partnerships with Nike, Adobe, Starbucks, and Mastercard. But success was followed by stagnation. Competitors like Arbitrum, Optimism, and Base began to capture market share faster than Polygon could evolve. In 2023, the team introduced Polygon 2.0, an ambitious vision of a unified liquidity layer. However, the migration from MATIC to POL proved to be painful.Polygon seemed lost between the past and the future — too big to be a startup, but too slow to remain a leader.

The troubled relaunch and rising inflation

The new POL token was supposed to symbolize a fresh start. It introduced a 2% annual inflation rate — about 200 million new tokens each year — to fund validator rewards and ecosystem grants.

Polygon explained this as a way to “ensure long-term network sustainability,” but the market saw something else: constant price pressure and the lack of a clear scarcity model.

Between 2024 and 2025, POL fell 46%, dropping even below the lows of the 2022 bear market, when the entire sector was struggling. For investors, this became an alarming signal: while other altcoins were recovering, POL looked like an outsider.

The activist revolt: A call to end inflation

In autumn 2025, the situation reached a breaking point. An investor under the nickname Venturefounder published a manifesto that gained over 25,000 views on X. In it, he sharply criticized Polygon’s tokenomics and demanded a complete end to the 2% inflation, proposing instead a treasury-funded buyback or burn program.

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The Venturefounder proposal suggests gradually reducing inflation by 0.5% each quarter until it reaches zero.

According to him, this could restore investor confidence and align POL with other deflationary models — such as BNB or Avalanche, which have already demonstrated the benefits of supply reduction.

The discussion on the Polygon governance forum spans dozens of pages. Among those who joined were co-founder Brendan Farmer and CEO Marc Boiron, who publicly acknowledged that “financial sustainability has become the central issue for the ecosystem.”

Technology versus reality

Polygon has always been about technology. Its zkEVM and AggLayer remain some of the most ambitious scaling innovations in the industry. But the market has changed: technological excellence is no longer enough — economic stability is what matters now. POL found itself in a situation where innovation alone cannot fight basic market forces.

Polygon still maintains one of the largest developer communities — especially in Latin America, where it’s widely used for real-world asset (RWA) tokenization.In June 2025, the startup AlloyX launched a tokenized money market fund on Polygon, becoming one of the most notable initiatives in the segment.

Thanks to such projects, Polygon remains a technical backbone for enterprises and startups, even if investors are no longer confident in POL’s value.

The road to recovery

Polygon is facing a crisis that could either make it stronger — or erase it amid new Layer-2 competitors. It still has all the ingredients for recovery: mature technology, a vast ecosystem, a strong developer base, and enterprise support.

But now it must prove that behind all the technical jargon lies a real strategy — not just another rebranding, but a genuine vision for the future.Polygon began as an alternative to Ethereum’s slow throughput — and now faces its own slowdown.

Its survival will depend not on inflation charts or price graphs, but on whether it can reignite what truly matters: trust in its mission.

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