This article talks about Polygon (MATIC), which is a protocol and a framework for building and connecting Ethereum-compatible blockchain networks.
The world of Crypto is witnessing the use of new technologies almost every day. These latest technological developments may be difficult for common people to understand and thus to act upon them. You might have heard about the crypto named Ethereum but may not know the blockchain technology behind it. The networks and technology used in the crypto industry are very vast and complex. Polygon (earlier known as Matic Network) aims to provide multiple tools to increase the speed and control the cost of transactions involved in blockchain networks.
What is Polygon (MATIC)?
Founded in 2017, by Jaynti Kanani, Sandeep Nailwal, Anurag Arjun, and Mihailo Bjelic, Polygon is a layer-2 network that acts as an add-on to Ethereum and it does not seek any change to the original blockchain layer. Polygon has centered its vision on Ethereum. Polygon, through its technology and networks, is assisting Ethereum to expand in size, security, efficiency, and usefulness in order to spur developers to bring enticing products in the market as soon as possible. In simple words, Polygon is a protocol and a framework that helps in building and connecting Ethereum-compatible blockchain networks. Polygon aims to combine the beat of the Ethereum and sovereign blockchains technologies into a complete multi-chain network. Polygon is beneficial to investors as well as it works towards solving the pain points associated with the use of blockchains such as high gas fees and slow speed. Some other multi-chain systems, which are akin to Polygon and are gaining popularity are Polkadot, Cosmos, and Avalanche. Polygon has its own cryptocurrency known as MATIC, which is widely used to pay fees on the Polygon networks, for governance, and for staking. You can buy this crypto from any of the crypto exchanges in India like Coinbase, WazirX, etc.
What are the Features of Polygon (MATIC)?
Polygon not only combines the best of Ethereum and sovereign blockchains into one attractive set but also promises a simpler framework for building interconnected networks. Some of the features of Polygon are:
- Robust Framework: Polygon functions as an open-source network and allows you to change and expand its uses over time with ease. Polygon has a robust modular structure that gives a high level of security and stability to run efficiently. It aims to make blockchain transactions simpler.
- Interoperability: Presently, Ethereum is the only base chain that is supported by Polygon. Polygon is planning to expand its support to other base chains, which would allow compatibility with other blockchains. Polygon also offers native support for arbitrary message passing in the form of tokens and contract calls to bridge the external systems.
- Scalability & Modularity: Polygon networks boost having dedicated blockchains, custom Wasm execution environments, and scalable consensus algorithms. Polygon also promotes modularity through high customization, extensibility, upgradeability, and community collaborations.
- Security: Polygon provides high-end security to its users through a layer-2 solution, which makes use of professional validators for Proof-of-Stake.
- User & Developer Experience: Polygon aims to provide a good user and producer experience with the help of its advanced technology and networks. Polygon facilitates instant transaction finality and “Zero-gas” transactions. The developer experience is equivalent to Ethereum with no requirement of protocol-level knowledge, no token deposits, fees, or permissions.
How Does Polygon Work?
Polygon operates as a multi-level platform and uses a variety of technologies to create a parallel blockchain and to link to the Ethereum blockchain network in an effective and cost-efficient manner. Polygon is an Ethereum sidechain network, which refers to a unique blockchain that is bound to Ethereum blockchain and supports many Decentralized Finance (Defi) protocols available in Ethereum. Polygon Software Development Kit (SDK) is used to develop Ethereum compatible applications and then connect them to the main blockchain. Polygon uses a Proof-of-Stake (PoS) sidechain as its main chain, where participants can stake MATIC tokens in order to validate transactions and vote on the network upgrades. Several ways to develop a sidechain include construction scalability methods such as Plasma Chains (bundles transactions into blocks and batched into a single submission on the Ethereum blockchain), zk-Rollups (allows multiple transfers bundled into a single transaction), and Optimistic Rollups (capable of scaling Ethereum smart contracts).
Why does MATIC have Value & Why Use it?
MATIC is a cryptocurrency that is native to the Polygon network and thus can be used to drive development across the networks and for staking and paying for the transaction fees. Users of the Polygon network can earn MATIC tokens by offering computational resources and services to the network (by validating transactions and executing smart contracts). Users also gain the ability to vote on network upgrades by owning and staking the token. The supply of MATIC tokens is limited like many other crypto coins, and as per the software’s rules, there will only be 10 billion MATIC tokens in circulation.
MATIC tokens can be used to provide scaling solutions to Ethereum, and developers can build more user-friendly apps on its blockchain with the use of Polygon’s technology such as SushiSwap and QuikSwap, which are decentralized exchange platforms, Augur, a prediction market platform, etc. Investors may also be interested to buy MATIC to add it to their investment portfolios if they believe in Layer-2 solutions for improving the Ethereum blockchain and networks.
Conclusion
With the rising popularity of cryptocurrency in the Indian market, its associated technologies are also getting their due attention. Polygon is one such useful technology that allows you to do the same things that the main Ethereum network does, with only a fraction of the fees. The low fees and instant transactions make the Polygon network a good option to gain experience in Defi protocols.