What is Polygon (MATIC)?

What is Polygon (MATIC)

Polygon, formerly known as Matic Network, is a scaling solution that aims to provide various tools to improve speed and reduce the cost and complexity of transactions in blockchain networks.

At the center of Polygon's vision is the Ethereum, a platform that houses a variety of decentralized applications where you can join virtual worlds, play games, buy art and participate in a variety of financial services.

However, so much activity in your blockchain made Ethereum almost unusable as the cost of transmission is increasing and traffic is becoming congested.

In a nutshell, Polygon counts itself as a layer 2 network, meaning it acts as an additional layer to Ethereum that doesn't seek to change the original layer of the blockchain.

Like its geometric name, Polygon has many sides, shapes and uses and promises a simpler structure for building interconnected networks.

Polygon wants to help Ethereum expand in size, security, efficiency, usability and seeks to encourage developers to bring compelling products to market as quickly as possible.

After the rebranding, Polygon retained its MATIC cryptocurrency, the virtual currency that supports the network. MATIC is used as a payment and settlement unit between the participants that interact in the network.

Who Created Polygon

Who Created Polygon?

Polygon was created in India in 2017 and was originally called Matic Network. It was the brainchild of experienced Ethereum developers — Jaynti Kanani, Sandeep Nailwal and Anurag Arjun, as well as Mihailo Bjelic.

The Matic Network went live in 2020 and attracted some of the top names in the world of finances decentralized companies, also known as DeFi, including Decentraland and MakerDAO. The Matic Network moved to Polygon in February 2021.

In its April 2019 initial offering, the Polygon team raised the equivalent of $5,6 million in ETH by selling 1,9 billion MATIC tokens in an accelerated 20-day period.

Why Does MATIC Have Value?

MATIC is the native cryptocurrency of the Polygon network and is used to help drive development on the network and can be used to stake out and pay transaction fees.

Users can earn MATIC tokens by providing computing resources and services to the Polygon network. This can be done by validating transactions or executing smart contracts on the network.

In addition, by owning and staking MATIC, users gain the ability to vote on network updates, with each vote being proportional to the amount of MATIC cryptocurrency they staking.

Like many other cryptocurrencies, the supply of MATIC tokens is limited, which means that according to the software's rules, there will only be 10 billion MATIC coins in circulation.

Polygon price

 

How Does Polygon Work?

Polygon is a multi-level platform aiming to scale Ethereum thanks to a multitude of sidechains, all aiming to clear the main platform in an effective and cost-effective way.

If you are unfamiliar, sidechains are unique blockchains that are tied to the main Ethereum blockchain and are effective in supporting many decentralized finance (DeFi) protocols available in Ethereum.

Thus, Polygon can be compared to other competing networks such as Polkadot, Cosmos and Avalanche.

Architecture

At the core of the network is the development kit for software (SDK) Polygon, used to build Ethereum-compatible decentralized applications as side chains and connect them to your main blockchain.

Sidechains can be built using one of the following build scalability methods:

Plasma Chains — groups transactions into blocks, grouped into a single submission in the Ethereum blockchain
zk-rollups — Allows multiple transfers to be grouped into a single transaction
Optimistic Rollups — similar to plasma chains, but with the ability to also scale Ethereum smart contracts.

Polygon's main chain is a Proof of Stake (PoS) side chain in which network participants can staking MATIC tokens to validate transactions and vote on network updates.

Why Use Polygon (MATIC)?

Polygon Network proponents can be attracted by its ability to provide scaling solutions for Ethereum, and developers can leverage Polygon technology to build more user-friendly dapps on their blockchain.

Examples of dapps built into Polygon include Sushi, a decentralized exchange platform, Augur, a market forecasting platform and Ocean Protocol, a platform that allows businesses and individuals to exchange and monetize data and data-based services

Investors can also look to buy MATIC and add it to their portfolio if they believe in Layer 2 solutions to enhance the Ethereum Network.

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