Polygon (Matic), like several other cryptocurrencies networks, is a scaling solution designed to provide faster transaction speeds at a reasonable price. Bitcoin and Ethereum are the leading names in the crypto world but both networks are struggling to fulfill the requirements of the users because these networks can only handle a small number of transactions at a time.
Ethereum has more burden on its network as it supports smart contracts, NFTs, and other applications that attract a vast majority of users. When the network is clogged, the transaction fee (the gas fee) is ultimately increased.
Many blockchain networks have been designed over the past few years to compete with Ethereum while providing better services to users. Polygon (Matic), on the other hand, isn’t a competitor of Ethereum. It’s designed to support the Ethereum network in expanding its size, security, and usefulness.
What is Polygon (Matic)?
Polygon is a layer-2 network that can be applied to the Ethereum network without making any changes to the original blockchain. It’s designed to connect and build Ethereum-compatible blockchain networks.
Polygon is dedicated to supporting the multichain Ethereum ecosystem with a range of scalable solutions. Therefore, it refers to itself as “Ethereum’s Internet of Blockchains”.
Polygon introduces a framework of layer-2 solutions and sidechains to be interoperable with Ethereum’s infrastructures. Polygon is a plasma-based aggregator that complements the fundamental pain points of the base chain while reducing its burden.
Polygon’s framework doesn’t only manage the decentralized apps but it can also transfer the transactions from the main blockchain to the sidechains.
How Does Polygon Work?
Polygon operates through a Proof-of-Stake consensus mechanism that transfers the transactions from the main blockchain to the sidechains. The validation process is carried out over the sidechains and the transactions are then finalized on the main chain. Thus, it provides faster transaction speed while reducing congestion and gas fee.
Polygon network consists of two types of chains known as stand-alone chains and secured chains. The secured chains are managed by a group of professional validators whereas the stand-alone chains are the Ethereum-compatible, self-sovereign chains that operate by themselves.
Polygon Architecture
Polygon is designed to support the mass adoption of the Ethereum network. It provides a software development kit (SDK) for those who want to run their decentralized applications on the Ethereum network. The development process is carried out over the side chains. And the apps are then connected to the main blockchain.
Polygon has developed a set of scalability methods that can be used for building sidechains:
Plasma Chains – It’s a framework that enables users to develop decentralized apps off-chain while taking advantage of Ethereum’s secure infrastructure.
zk-Rollups – This framework submits the proof of validity to the main chain while executing the transactions off-chain.
Optimistic Rollups – This framework is pretty much similar to the zk-Rollups as it executes the transactions off-chain. But instead of submitting the proof of validity for each transaction, it only submits the proof of fraud if a block is against the terms of the main network.
Validum Chains – It’s another framework identical to zk-Rollups but it stores the data on sidechains instead of transferring it to the main chain.
Stand-alone Chains – These chains can be connected to the main network through bridges.
Secured Chains – On these chains, the validation process is managed by a shared pool of PoS validators.
Interestingly, these scaling mechanisms don’t affect the security and user experience of the Ethereum network. Thus, they can be a great alternative to slow blockchain transactions.
What are the Use Cases of MATIC?
MATIC is the native token of Polygon Network. With a circulating supply of 7.6 billion coins, MATC has a market capitalization of $11.1 billion. MATIC has a maximum supply of 10 billion coins that will be released over the next few years. MATIC is the 16th most popular cryptocurrency in terms of market cap. MATIC can be used for several purposes within the platform.
Payments – MATIC can be used as an exchange option on different decentralized apps that are developed through its network.
Gas Fee – The users need to pay a small amount of MATIC token when processing transactions through its network.
Staking – The users can stake their MATIC tokens to become a validator. They need to lock at least 1,000 MATIC tokens in a specified wallet to become a part of this program. Furthermore, they need to have a full-time running node (or computer) that can help with the validation process.
The users have a risk of losing a portion of their staked coins if they act maliciously or make an error. The validators get a portion of the gas fee as a reward once the transaction is finalized.
Delegating – Those, who don’t have the required amount of MATIC tokens to become validators, can stake their tokens through a reliable validator. Thus, they can earn some commission in the form of MATIC tokens. However, they may lose their staked coins if the validator makes an error. Therefore, it’s important to conduct proper research before choosing a validator.
How does Polygon Contribute to the Blockchain Industry?
Polygon provides a frictionless platform for the blockchain networks allowing them to exchange information without technological divides. By establishing Ethereum’s Internet of Blockchains, Polygon has already introduced a borderless digital world to the crypto community.
With just a single click, the developers can now launch their own blockchain protocols that are compatible with Ethereum. Polygon is providing absolute interoperability to the Ethereum-based apps without affecting the decentralization of the main network.
Thus, it allows developers to create decentralized applications on their favorite blockchain network (Ethereum) while enjoying fast transaction speeds and low gas fees.
Conclusion
Polygon is a layer-2 network designed to solve the scalability issues of Ethereum. It has introduced several consensus protocols that can help with fixing the complexities of the Ethereum Network. We’ve shared information about how Polygon (MATIC) works. If you need more information about how Polygon is contributing to the crypto world, feel free to reach out to us.