Polygon is a “layer two” scaling solution that runs alongside the Ethereum blockchain, allowing for fast transactions and minimal costs. MATIC is the network’s native cryptocurrency, utilised for fees, staking, and other purposes. MATIC can be purchased or sold on exchanges like as Coinbase.
The Ethereum blockchain supports a wide spectrum of economic activities, from NFT markets and games to the expanding DeFi ecosystem. Ethereum is ideal for this activity because it is compatible with smart contracts, which can be used to create a wide range of applications.
However, when these applications gain popularity, they add additional transactions to the Ethereum blockchain, and as a result, transaction costs (also known as “gas”) can sometimes rise to the point where making small or frequent deposits becomes economically unviable.
Enter Polygon, a “Layer 2” scaling solution (or “sidechain”) that has emerged to give users with speedier transactions and lower expenses. It functions as a fast parallel blockchain that runs alongside the main Ethereum blockchain. To utilise it, transfer some of your crypto to Polygon and then interact with a variety of popular crypto apps that were previously only available on the main Ethereum blockchain.
What Exactly is MATIC?
Polygon has its own coin, called MATIC, which is used to pay network fees, staking, and governance (which means that MATIC holders get to vote on changes to Polygon). MATIC can also be purchased and sold on Coinbase and other exchanges. MATIC derives from an earlier period of Polygon’s development. Developers rebranded as Polygon in early 2021 after debuting as Matic Network in October 2017.
How Does Polygon Function?
Polygon can be compared to a metro express train in that it runs the same route as the standard train but has fewer stops and hence moves significantly faster. (The main Ethereum blockchain represents the local railway in this scenario.) Polygon employs a number of technologies to build this fast parallel blockchain and connect it to the main Ethereum blockchain.
Polygon has a proof-of-stake consensus technique to generate new MATIC and secure the network, which implies that staking is one way you can earn money on MATIC you own.
- Validators are in charge of verifying new transactions and adding them to the blockchain. In exchange, they may obtain a charge reduction and newly developed MATIC. To become a validator, you must commit to hosting a full-time node (or computer) and staking your own MATIC. You could lose some of your staked MATIC if you make an error or act maliciously (or simply if your internet connection is flaky).
- Delegators stake their MATIC through a trusted validator. This is a substantially lower-risk kind of staking. However, investigation is still required since if the validator you choose acts maliciously or makes errors, you could lose some or all of your staked MATIC.
Advantages and Disadvantages of Polygon
You may be curious about Polygon’s primary strengths and weaknesses. Especially if you are considering purchasing MATIC, continue reading to learn about Polygon’s benefits and drawbacks.
Among Polygon’s Strengths Are:
By utilising a consensus mechanism that completes the transaction confirmation procedure inside a single block, Polygon is able to maintain rapid transaction processing speeds.
- The average block processing time at Polygon is 2.1 seconds.
- The typical transaction charge on Polygon’s platform is approximately $0.01, which is constantly cheap.
Among the Weaknesses of Polygon Are:
Not an independent blockchain, Polygon is a Layer 2 solution that operates on top of Ethereum. If the Ethereum platform encounters significant problems or ceases to exist, Polygon’s value would likely decline.
The MATIC token is intended to administer and secure the Polygon platform, as well as pay transaction fees. MATIC, unlike other digital currencies, is typically not used for ordinary purchases.
Polygon employs a modified proof-of-stake consensus algorithm that enables every block to obtain consensus. In exchange for the authority to authenticate Polygon network transactions, the proof-of-stake approach requires network participants to stake, or pledge not to trade or sell, their MATIC. Successful Polygon network validators are rewarded with MATIC.
As a supplementary scaling solution, the Polygon network intends to overcome the Ethereum platform’s constraints, especially high transaction fees and poor transaction processing times. Polygon can:
- Deploy current blockchain networks and create your own.
- Allow Ethereum to communicate with other blockchains.
- Assist existing blockchain networks in becoming Ethereum-compatible.
Jaynti Kanani, Sandeep Nailwal, Anurag Arjun, and Mihailo Bjelic co-founded Polygon. Currently, the platform serves more than 7,000 blockchain-based projects.
Future of Polygon
In 2021, Polygon formed Polygon Studios, a company specialising in blockchain gaming and non-fungible tokens (NFTs). If successful, Polygon Studios might establish Polygon as a top provider of technology for decentralised gaming and NFTs.
Polygon received a new chief executive officer in January 2022. (CEO). Ryan Watts has joined Polygon after serving as the head of gaming at YouTube.
What Is the Value of MATIC Coins?
Polygon’s MATIC tokens have traded for less than 5 cents for the majority of its lifespan. The price of MATIC has risen dramatically but has stayed below $3.00. As of February 18, 2022, MATIC was selling at about $1.60.
What is the Total Number of Polygon Coins?
MATIC has a maximum quantity of 10 billion tokens. The vast bulk, 7.53 billion MATIC, have already been distributed.
How Can I Purchase MATIC?
A major cryptocurrency exchange is the most convenient option to purchase Polygon’s MATIC tokens. You can open an account with an exchange such as Coinbase or Kraken and then fund it using your local currency. A digital wallet is also required, which can be self-hosted or hosted by the bitcoin exchange.