With a positive trajectory over the past 24 hours and in line with general market sentiment, Polygon decentralize exchange (DEX) QuickSwap could give its fundamentals a boost. According to a recent Announcementthe project could split its native governance token QUICK.
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The platform’s official social media channel, which has been called the “most important board discussion yet,” has sparked a fierce debate among Polygon users. This process is critical and, depending on the outcome, may precede a vote on the token split.
The main argument behind the proposal is supported by the potential expansion of the Polygon token, QUICK, offering. The project is currently planning changes to its tokenomics. A change in QUICK’s offering is the first and one of the most important.
If approved, the community will vote on potentially splitting the Polygon token into a 1:100 or 1:1,000 relationship. The team behind QuickSwap clarified the following:
This would mean that for every 1 QUICK you have now, you will have 100 QUICK or 1000 QUICK after the split. QUICK’s maximum supply would increase from 1 million to 100 million or 1 billion.
The fork would attempt to “open” QuickSwap to new users, particularly those with the intent to invest but who find FAST “too expensive” or with “little opportunities” at future valuation. The proposal has received support from some of the QUICK holders, while others remain skeptical.
5/ A concern is that the split could be considered a taxable event💸
💰We know how much dragons value their treasure and wouldn’t want you to throw away yours
🪙We are not tax experts and cannot provide tax advice, but stock splits are not taxable events and neither should token splits
— QuickSwap (@QuickswapDEX) March 5, 2022
Roc Zacharias, co-founder of QuickSwap commented the following about the potential implications of the token split on the DEX ecosystem and its ability to improve the platform’s components, such as the treasury:
If this split DOES work the way we think it could, it could bolster the Treasury (which is owned by all of you, the community, it could increase the reward value which can increase liquidity and indirectly volume etc. Think carefully about this .
Polygon QuickSwap Token Split and the Polkadot Case
Many users, including the team behind the Polygon decentralized exchange platform, have compared this potential token split to the stock market. In the old financial system, it is “common” for companies to issue more shares through a similar process addressing a concept called Unit Bias.
This idea, as explained by the team behind QuickSwap, indicates that an investor may be willing to own “more of a less scarce asset.” In the crypto industry, other projects have done token splits in the past, often leading to price surges.
The team behind token swap cited Polkadot (DOT) as an example. Through their official Twitter handle, QuickSwap said:
(…) when Polkadot did a 1:100 redenomination, $DOT rose from a market cap of less than 100 to the 7th position. More recently, Gains Network did a 1:1000 token split and migrated from GFARM2 to GNS. In bleak conditions, GNS did a 6x.
It remains to be seen if history will repeat itself with QUICK. However, Polygon and a second-tier solution on Ethereum seem to be attracting a lot of attention as they provide users with a cost-efficient and more scalable gateway to the DeFi sector.
Today, https://t.co/Y7yxw3SzE7 published a piece analyzing $QUICK‘s price💰
Wallet Investor Suggested QUICK Could Be Worth $7.95 By Year End
That’s eerily close to the $7.67 I calculated by averaging #DEX Coins
If QUICK did a 1:1000 token split and rose to $7.67, WWYD?
— NrdGrl007 🤗 🐇 🕳 (@nrdgrl007) March 7, 2022
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At the time of writing, Polygon (MATIC) is trading at $1.43 with a gain of 1.7% on the last day.
MATIC trends downward on the daily chart. Source: MATICUSDT Tradingview