Polygon – MATIC
Polygon – MATIC, originally Matic Network, will allow developers to set up projects through a proprietary blockchain but invoke the key features of the Ethereum network. As well as, Polygon will provide nearly free and lightning fast access to DeFi applications.
Polygon is a solution to some of the biggest challenges the Ethereum network is struggling with. Due to the Ethereum consensus mechanism, scalability is not optimal and users face high costs (gas fees) and delays on their transactions.
While Matic offered a simple additional layer that developers could connect to (layer-2 scaling solution), the revamped Polygon is a multi-chain infrastructure that aims to support a network of scalable blockchains. In this way, developers can build decentralized applications (DApps) that are immediately ready for large-scale use.
This review of Polygon – MATIC was created for informational purposes. This article is not intended for promotion.
Polygon will be able to connect blockchains to the Ethereum network and bundle them into a full multi-chain system.
By setting up this multi-chain system, Polygon aims to offer the following improvements;
The Matic sidechain has its own infrastructure, token (MATIC) and validator nodes like almost every PoS blockchain. The difference is that the transactions take place on the Matic sidechain and will be finalized on the Ethereum mainchain.
The checkpoints play the role of host for the PoS strikers. Thus, any user can decide to stake their Matic tokens in the checkpoint layer and one speaks of a high degree of decentralization.
Users who want to use decentralized applications on the Matic sidechain go through the following steps.
The tokens are locked on the Ethereum network using a predicate contract. This allows the tokens to be deposited on the Matic network.
As soon as this predicate contract is approved, a certain smart contract called ‘RootChainManager’ activates another smart contract called ‘ChildChainManager’ that deposits the right amount of locked tokens on the Matic network. This process is called bridging.
The tokens have now moved from the Ethereum network to the Matic network, where they can be deployed to various decentralized applications.
When one will want to retrieve the tokens, one will burn the tokens on the Matic network and transfer this evidence to the Ethereum network. The smart contract ‘RootChainManager’ automatically deposits the tokens back to the user’s address on the Ethereum network.
Polygon Network was founded in 2019 by 3 Indians, who are still involved in the project in the meantime.
CEO Jaynti Kanani, who is a full-stack developer and blockchain engineer with experience at other well-known projects like Web3 and Plasma. COO Sandeep Nailwal, an entrepreneur and blockchain programmer and COP Anurag Arjun, who has experience in finance and project management.
Furthermore, the team consists of 12 other team members, each with a developing background and with experience from other blockchain related projects.
For a very detailed explanation of how the Fantom protocol works, please refer to the original whitepaper written in 2018.
MATIC is the native token of the Polygon Network and is used to perform transactions and use smart contracts. The token has a central role in the entire Polygon ecosystem.
Payments: Polygon is able to accelerate payments through specialized programming processes (API) and (SDK). Merchants and users are able to make payments immediately with ERC-20 tokens. Later, they plan to expand to any digital currency.
Loan Platforms: Polygon is co-building a mechanism that allows lending platforms to analyze creditworthiness based on users’ transaction history.
Gaming: Polygon’s Commit Chain scaling technology allows developers and gamers to build and play games more effectively. The popularity of non-fungible tokens (NFTs) allows Polygon to seize its opportunity. Top Gaming and NFT Dapps on Polygon are Aavegotchi, Neon District, and Cometh.
Other use cases: low cost and fast transaction times for decentralized exchanges (DEXs), cross-chain swaps, and improving identity privacy for developers and users.
DeFi or decentralized finance is on its way to making financial products large-scale and transparent to the entire world.
Because almost every decentralized application was built on Ethereum and the Matic sidechain is compatible with Ethereum, many applications will deploy on the Matic network.
In the meantime, Polygon is sharing in the construction of several applications that are trying to achieve this. About 40 Ethereum DeFi applications have since been deployed on the Polygon network.
Some of the important ones include;
TVL April – June 2021 (Polygon | Stats, Charts and Guide | DeFi Pulse)
The total value locked or total locked value in Polygon (MATIC) experienced a growth of over 1100% in the month of May 2021 alone.
This massive increase brings the total locked value in Polygon to a new high of $10.5 billion. The total of unique addresses trading in the Polygon ecosystem quadrupled.
On December 10, 2019, Matic fell victim to a classic back-pull. Rumors were circulating that the Matic team was behind it. CEO of Binance CZ stated that this was the result of the actions of a single whale manipulating the market. Still we do not know the truth fully but we can say that Polygon (MATIC) has been matured as a project.
Where Polygon’s focus was first on the Layer 2 solution for Ethereum, the focus is now on building out a multi chain infrastructure. Polygon’s story has completely changed and is perhaps one of the solutions for individuals who want to engage in DeFi with a ‘smaller’ portfolio. This at almost no cost transactions and the ability to trade on the major DeFi protocols. This is Polygon’s strongest strength as long as Ethereum does not find a solution to the scalability of its blockchain.
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