What is Polygon MATIC & how does it work?
Launched in 2017 under the name of “ Matic Network ”, Polygon is a second layer protocol (Sidechain) and a framework designed to solve the problems of Scalability and Cost (gas fee) encountered by the Ethereum blockchain. In other words, Polygon aims to turn Ethereum into a so-called “ multi-chain ” (Internet of Blockchains) platform. Its main component is Polygon SDK, a modular and flexible framework that supports building multiple types of applications.
Indeed, instead of becoming a direct competitor to Ethereum, like Cardano (ADA), the developers of Polygon preferred to “graft” onto its network (Ethereum) in order to considerably improve the user experience as well as its entire ecosystem.
For example, users of decentralized applications (dApps) who use the Polygon network, benefit from the advantages of the latter (Scalability, Cost, etc.), while being protected by the most secure blockchain in the world, Ethereum.
Given the scale and the enthusiasm that Polygon has generated in recent months, many protocols and projects have decided to deploy there. You can notably find Maker (MKR), Decentraland (MANA), Aaveand many others. But there are also native apps that don’t exist anywhere else, like QuickSwap and Slingshot.
As mentioned earlier in the article, the Polygon SDK module, “the gateway to multi-chain Ethereum ”, was implemented on the Polygon network in February 2021, in order to allow developers to create Ethereum-compatible networks. Simply put, Polygon SDK is a modular and flexible framework for scaling and developing Ethereum infrastructure.
Also Read: What is Etherscan?
Indeed, this upgrade offers big changes to the entire Polygon network ecosystem.
Let’s now analyze the very promising solutions that have been implemented via Polygon SDK, and those that should arrive in the coming months. Hang in there, your dose of Opium may be abnormally high.
Currently, Polygon’s infrastructure supports two types of Ethereum-compatible networks:
- Stand-alone chains;
- Secured Chains.
Autonomous chains are fully accountable, have their own pool of validators, and offer an extremely high level of flexibility and independence, but with the trade-off of a lower level in terms of decentralization and security.
Stand-alone chains plan to implement many solutions:
- Matic PoS Chains;
- Enterprise Chains.
For the moment, only the “Matic PoS Chains” solution has been introduced to the Polygon network (since its creation), the other solutions are still under development.
Matic (Polygon) PoS Chains:
Polygon PoS is an Ethereum sidechain compatible with its virtual machine (EVM), secure, and without validators submitted to Ethereum. As mentioned above, Matic PoS Chains have been implemented in the Polygon network since the inception of the project. Proof-of-stake-based assets offer PoS security and a much shorter withdrawal period to the main blockchain. PoS Chains is also called PoS Bridge because it takes care of transfers between two different networks.
Also Read: What is Web3?
What is called a “ bridge” is actually a set of contracts that help move assets (tokens) from the primary chain to the secondary chain. The PoS (or Proof of Stake) bridge monitors the totality of token transactions that occur on a contract called “ Root Contract ” (contract deployed on the Ethereum network).
The PoS Bridge will mainly be used by developers of decentralized applications and software (dApps) who are looking for great flexibility. In addition, withdrawals of Matic tokens to the Ethereum blockchain are subject to a single checkpoint and last between 20 minutes and 3 hours only.
Unlike stand-alone chains, Secured Chains are based on the security system offered by the Ethereum network or by a pool of “professional” validators. Although these chains are highly secure, they nevertheless neglect the flexible and autonomous part provided by Stand Alone chains.
Secured Chains plan to implement many solutions:
- Matic Plasma;
- Zk Rollups;
- Optimistic Rollups;
- Validum Chains.
For the moment, only the “Matic Plasma” has been introduced to the Polygon network (since its creation), the other solutions are still under development.
Since its creation, the Matic network has used an adapted version of the “ Framework Plasma ” technology, in order to benefit from faster transactions at a much lower cost. Simply put, Plasma is a computing “framework” dedicated to building decentralized and scalable applications that don’t sacrifice security for speed.
The Plasma Bridge will mainly be used by App developers looking for exceptional security and a rigid structure, but which in this case will be much less flexible than that offered by the PoS bridge.
In addition, withdrawals to the Ethereum network are carried out in 7 days(more than 10,000 minutes). This duration is due to the security mechanism based on Ethereum and therefore requires a higher verification period. As you will have understood, the PoS Bridge is more flexible and allows faster withdrawals than Plasma.
Rollups are scaling solutions that allow transactions to be executed in a very short time and at a low cost. In other words, they collect a large number of transactions in one place, which will be sent at regular intervals to the main blockchain (Ethereum). The Ethereum network will then take care of validating them and then sending them securely. Rollups are undoubtedly among the most promising Ethereum layer 2 scalability solutions.
Once implemented on the network, they will be widely used to reduce user fees and can perform very high transaction throughput.
This will allow developers to build secure and high throughput DApps, without worrying about data availability issues or withdrawal issues. We are now going to tell you about the two types of existing Rollups: the Zk Rollups (Zero Knowledge Rollups) and the Optimistic Rollups.
Zk Rollups (Zero Knowledge Proofs):
A Zk Rollups also called “Zero-Knowledge Rollups”, is a verification method that takes place between two intermediaries (prover and verifier). As its name suggests, Zk Rollups are “ proofs without knowledge ”, that is to say, that they are able to verify information (eg transaction), without disclosing it. This is why this method is known to be very secure while allowing a very high transaction throughput. It also increases the scalability of the network by processing transfers of large amounts of computed data (transactions) in a single transaction.
In general, Zk Rollups are used for applications where privacy and security are critical to their proper functioning. For example, crypto projects that focus on the anonymity of their users like Z-cash are ideal. Click on this link to learn more about Zk Rollups.
JUST IN: #MATIC announces a giant leap forward for Ethereum scaling and ZK innovation.
Introducing Polygon #zkEVM, the first EVM-equivalent ZK L2.
Matic is releasing a complete implementation, fully open-source, and they’re just getting started.
— Technuto (@technuto) August 17, 2022
Optimistic Rollups (OR):
“Optimistic Rollups” run on Ethereum to facilitate near-instantaneous transactions through the use of “ proof of fraud”. This consensus mechanism is already present within the Polygon mainchain and greatly enhances transaction security. As you know, the Ethereum network is slow and very expensive, which severely limits its use. ORs enable the execution of smart contracts at scale while leveraging the infallible security system offered by Ethereum. Indeed, Optimistic Rollups can deliver up to 10 to 100 times more scalability improvements depending on the transaction.
Optimistic Rollups are very similar to Plasma Chains, although the latter do not have the same execution capabilities. Note that the Rollups (Optimistic / zk) are still under development, but promise very big changes in terms of cost, speed (throughput), and security, once their implementations are finalized.
Also Read: What is Blockchain?
At the moment, Polygon is secured by its own set of validators (validator pool). That is, it has to secure itself, instead of leveraging the security system of Ethereum, the most secure blockchain in the world. This is why the arrival of Rollups in the Polygon network is a major technological advance for its entire ecosystem.
Let’s now go into detail about the different layers present within the Polygon protocol. Polygon’s architecture is made up of four distinct layers:
- Execution layer: Allows the execution of transactions and smart contracts from blocks in the Polygon network, through the implementation of the Ethereum virtual machine (EVM).
- Polygon networks layer: This layer is certainly one of the most important in architecture. Indeed, it manages the local consensus and takes care of a certain number of major actions, such as the production of blocks or the realization of classification of transactions.
- Security layer: The security layer works in parallel to the Ethereum network. It mainly deals with verifying registrations, network rewards, and validating certain chains of Polygon. It can also be implemented directly on Ethereum, in which case Ethereum miners will do the validation themselves. Note that this layer is not mandatory, but simply recommended in certain cases.
- Ethereum layer: This layer is implemented as a set of Ethereum smart contracts. It performs many primary tasks, such as the finality and control of a transaction; staking; _ the resolution of disputes or the relay of messages between Ethereum and the various Polygon chains.
Obviously, it was essential to establish a convenient and secure way to bring funds from another network to that of Polygon. This is why “ Polygon Bridge ” has been developed and can now accommodate your MATIC tokens. You simply have to connect your wallet (Metamask, Coinbase …) and you can freely use this feature.
What is the MATIC token used for?
MATIC is the native token of the Polygon platform. Indeed, the latter is used for many essential tasks and to ensure the proper functioning of the network ecosystem. Here are in detail the different use cases of the MATIC token within the Polygon infrastructure:
- Pay network fees;
- Securing the network;
- Governance system;
- High yield staking.
Pay network fees
Like a large number of utility tokens, MATIC is initially used to pay the costs of operations (gas fee) carried out on the network. To give you an idea, it can accommodate nearly 10,000 transactions per second, which is equivalent to the networks of VISA and Master Card combined.
Must Watch: Top 10 Crypto Exchanges with the Lowest Fees!
The token is also used to pay staking returns to MATIC token holders.
High Yield Staking
The Polygon platform has a staking system allowing MATIC holders to collect a certain reward rate, in exchange for their contribution to the network.
To date, Polygon Stacking has raised a total of approximately 1.8 billion MATIC. As for the rewards redistributed to users, the amount amounts to more than 311 million dollars.
Distribution of the MATIC Coin?
- Private sale: 3.80% ;
- Binance Launchpad (IEO) sale: 19% of total supply ;
- Team: 16% ;
- Advisors: 4% ;
- Network operations: 12% ;
- Foundation: 21.86% ;
- Ecosystem: 23.33%.
Moreover, 100 addresses hold more than 90% of all tokens in circulation in the world. This means that if some of its holders agree to sell part of their capital, this could considerably impact the price of MATIC in the short term. However, most wallets certainly have a long-term view of the project and are not about to sell their tokens.
Advantages and disadvantages of the Polygon network
Benefits of the Polygon Network:
- Security ;
- Low transaction fees;
Disadvantages of the Polygon Network:
- Still recent Polygon SDK implementation.
What are the wallets to store your MATIC?
Currently, Binance is the No. 1 platform in the cryptocurrency market. Although the latter is mainly used for trading, it also allows you to store your tokens safely. We advise you to use this method for short/medium-term use
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Metamask is an excellent solution for storing your cryptocurrencies online. Just install the extension available on Google Chrome and then add the asset you want to store. This wallet offers a multitude of tokens, including Bitcoin (BTC), Ethereum (Eth), and of course MATIC.
Just like its competitor Metamask, Trust is one of the most reputable online wallets in the world. Indeed, you can manage a large number of cryptocurrencies there, such as MATIC, Bitcoin (BTC), or even Ethereum (ETH), in complete safety and very simply.
Ledger is a company known worldwide for its wallets (hardware wallets), offering its users the possibility of storing their cryptocurrencies in complete safety.
Indeed, the company holds several types of portfolios (wallet) such as the “Ledger Nano S” or the “Ledger Nano X”.
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Notably known for its “SFP” token launched in February 2021, the “Safepal” company has also developed its own “hardware wallets”. On these, you can store a number of cryptocurrencies, such as Bitcoin, Ethereum or even MATIC.
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How to Buy Polygon (MATIC) Coin?
Binance – 20% off
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Frequently asked questions for Polygon (MATIC) cryptocurrency
What is the price of the Polygon (MATIC Price)?
Currently, the Polygon (MATIC) price is $0.91 and has fluctuated by 2.07% in the last 24h.
What is the historical high of the Polygon (MATIC)?
The Polygon (MATIC) reached its highest price and was €2.58 or $2.92. Since then its price has corrected by -48.53%.
What is the best way to buy Polygon (MATIC) cheaply?
The Binance platform allows you to buy Polygon (MATIC). This platform offers the lowest fees on the market and trades your favorite cryptocurrencies.
What is the ranking of the Polygon cryptocurrency?
The Polygon (MATIC) is currently the 20th cryptocurrency in the world.
What is the capitalization of the Polygon (MATIC)?
Currently, the capitalization of the Polygon (MATIC) is €9,157,393,710.00 or $9,157,393,710.00.
What is the official Polygon website?
You can find all the information about the Polygon (MATIC) directly on the Official Polygon Website.