What is a token migration in crypto?

A token migration is when a crypto project moves holders from an old token to a new version. Coinbase describes it as a project switching to a new version of its token, usually after a protocol update or a move to a new blockchain.

What does it mean when a crypto coin migrates?

It means the token you hold is being retired and replaced, usually at a fixed ratio. The project deploys a new token contract, or a new native coin, and sets out how old tokens convert.

A well-known example is Polygon's switch from MATIC to POL. The migration went live on September 4, 2024, at a 1:1 ratio, and POL became the gas and staking token on the Polygon PoS network. Polygon said there was no deadline at the time for MATIC holders on Ethereum to upgrade, though the community could set one later. Migrations are different from a token burn or a delisting, though a migration often leads to the old token being delisted.

How does a crypto token swap migration work?

The method depends on where the tokens are held. In Polygon's case:

• On the Polygon PoS network, MATIC became POL automatically. Users only needed to change the token symbol in their wallet's network settings.
• On Ethereum, holders had to migrate manually through the Polygon Portal, approving the upgrade contract and confirming a transaction.
• Staked MATIC on Ethereum converted to staked POL with no action needed.
• On exchanges, Polygon expected most major platforms to handle the upgrade for users. Coinbase says it converted customers' MATIC to POL automatically at 1:1 with no transaction fees.

Polygon also warned users not to send MATIC straight to the migration contract address, since calling it incorrectly could cause permanent loss.

Do you need to do anything in a token migration?

Sometimes. Coinbase says that unless it states otherwise, users usually need to migrate manually with a self-custody wallet and the issuer's portal, and that missing the deadline can mean losing access or value. In other cases it converts balances automatically. Coinbase also warns that sending legacy tokens to a deposit address after a migration may make them unrecoverable.

Instructions are best taken from the project's official site and the exchange's own notices.

How do token migration scams work?

Scammers can copy real migrations with lookalike websites and emails that urge people to "migrate" their tokens. Coinbase's guidance for one of its own platform migrations shows the warning signs. It says to check the exact domain, that it will never ask for a private key or seed phrase, and that any request to sign something to "migrate" assets is a scam. It advises signing only login messages there, never transactions or token allowances. How malicious approvals empty wallets is covered in crypto phishing and wallet drainers.

A migration may also have tax consequences, and Coinbase notes a swap could be treated either way. Rules differ by country and change often. Check the tax authority or a qualified professional for your own situation.