Activist investor pushes Polygon tokenomics overhaul amid POL price slump

A new proposal to overhaul Polygon’s tokenomics is gaining momentum on the project’s governance forum and across social media, as investors voice frustration over POL’s steep underperformance compared to the broader crypto market.

The , authored by activist token investor Venturefounder, calls for major revisions to Polygon’s () 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.

“These 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,” Venturefounder wrote in the forum post.

Under the current model, Polygon’s 2% annual inflation adds roughly 200 million new POL tokens to the market each year — 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.

The author cites BNB (), Avalanche () and Ether () as examples of tokens that have benefited from , arguing that a similar approach could strengthen POL’s value proposition.

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’s 46% decline over the past year, and its current trading level below 2022 bear-market lows, as “inexcusable” during what many consider a crypto bull market led by Bitcoin () and Ether.

“These excuses are NOT VALID,” Venturefounder wrote. “There is nothing wrong with the market, there is something SERIOUSLY wrong with POL, and it’s DOWN BAD.”

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 .

The proposal has drawn positive engagement from within the Polygon ecosystem. Brendan Farmer, Polygon co-founder, reacted to the discussion, and  acknowledged the proposal on social media.

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.

Related:

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.

In 2024, from MATIC to POL as part of a broader governance and tokenomics overhaul intended to enhance community participation and secure the network. The transition schedule to fund validator rewards and ecosystem incentives.

Despite its recent struggles, Polygon retains a strong developer community, particularly among builders seeking technical maturity and enterprise-grade infrastructure. 

As , 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.

Polygon has also doubled down on the tokenization of real-world assets (RWAs). In a recent example, AlloyX, a tokenization infrastructure provider, . This growing RWA activity has helped fuel broader onchain engagement, including a milestone where .

Magazine: