A Comprehensive Overview of Polygon (MATIC): The Ethereum Layer-2 Scaling Solution

Robert Stone

Polygon, formerly Matic Network, increases the network scalability and transaction speed of Ethereum by significantly improving its functionality. Using Polygon’s Proof-of-Stake blockchain and Commit Chain connectivity helps scale the Ethereum network and solves inefficiencies that hinder the widespread adoption of blockchain technology.

Cryptocurrency enthusiasts are always looking for the next big thing. One of the biggest issues facing the cryptocurrency world is scalability. Ethereum, one of the most popular cryptocurrencies, is no exception. Ethereum has faced challenges such as low throughput, high transaction fees, and limited development options. But what if there was a blockchain that could address these problems while also leveraging Ethereum’s technology and security?

This is where Polygon comes in. Polygon, formerly known as Matic, is a layer-two scaling platform that allows Ethereum-based applications to overcome these challenges. Polygon and other layer-2 solutions address scaling issues that blockchains experience when they become too congested and costly to operate. As a result of layer-2 solutions, developers and builders can bridge assets between blockchains and interact without volatile transaction fees affecting their decentralized applications (dApps) ability to operate.

Polygon also offers staking to reward users for helping to secure the network by holding their tokens.

In crypto industries like GameFi, non-fungible tokens (NFTs), and decentralized finance (DeFi), which generate a high volume of small transactions, Polygon is an ideal solution. It focuses on increasing the usage of decentralized finance (DeFi) tools and applications by connecting different blockchains. Polygon currently hosts over 3,000 decentralized applications, of which over 80 big names migrated from the Ethereum main chain.

The Polygon network is similar to Ethereum. It uses Ethereum Virtual Machine (EVM), the actual code run by computers worldwide to execute the blockchain’s smart contracts. Polygon, Binance Smart Chain, and other extensive networks utilize the main Ethereum code. This makes it easy for developers to move their projects to a new network without making any changes.

One of the most significant benefits of Polygon is its Proof of Stake (PoS) consensus mechanism, which is faster and more affordable than Ethereum’s Proof of Work (PoW). Polygon is a series of blockchains that can help scale Ethereum. It’s not just a single PoS chain; it offers various scaling solutions that developers can use with Ethereum. Developers can create completely separate chains, such as Zk Rollup chains, Optimistic Rollup chains, or any other side chains they desire.

Polygon’s architecture runs on a four-layer system comprising of the Ethereum Layer, the Security Layer, the Polygon Networks Layer, and the Execution Layer. The Ethereum Layer is made up of different Ethereum-based smart contracts that handle staking, transaction approval, and interaction between the Ethereum blockchain and numerous Polygon chains. The Security Layer works alongside Ethereum to provide validator services that give chains an additional layer of security. The Polygon Networks Layer is the ecosystem of projects or blockchain networks developed on Polygon, while the Execution Layer executes smart contracts on the actual Polygon blockchain.

Overall, Polygon offers many benefits to developers and end-users alike; besides being a faster and more affordable alternative to Ethereum, it also provides more development options. The Polygon network also supports a wide range of decentralized applications, which makes it an attractive investment for those interested in DeFi. Polygon’s architecture and PoS consensus mechanism make it a robust and scalable blockchain solution that will take the usefulness of blockchain technology to the future.

As I mentioned earlier, the main challenge facing Ethereum is its low throughput. This means that the network can only handle a limited number of transactions per second, much lower than many alternatives. This has resulted in high transaction fees and slower processing times, which is a significant issue for many users.

Polygon’s PoS consensus mechanism is a game-changer in this regard. It offers faster transaction processing times and lower transaction fees, making it a more affordable alternative to Ethereum. Developers can also create different scaling solutions using Polygon’s architecture, which offers more flexibility in terms of developing new applications.

Moreover, the Polygon network’s compatibility with Ethereum makes it easy for developers to move their projects from Ethereum to Polygon without making any significant changes. This means that they can benefit from Polygon’s scalability and affordability without losing any of the benefits of Ethereum’s technology and security.

Polygon’s unique architecture also offers additional security features. Its security layer works alongside Ethereum to provide validator services, which give chains an additional layer of security. Moreover, Polygon offers numerous scaling solutions, including Zk Rollup chains, Optimistic Rollup chains, and other side chains.

Matic, the native token of the Polygon network, offers investors an excellent opportunity to invest in DeFi. Polygon offers a wide range of decentralized applications, and Matic is dispersed monthly and has a total supply of 10 billion tokens, of which nearly 6.8 billion are already in circulation. Investors can benefit from staking rewards, which come to around 12%.

Why are Layer-2 Chains Necessary?

Decentralization, active projects, robust security, and strong developer and investor support make Ethereum an ideal blockchain. However, Ethereum’s low TPS compared to other layer-1 blockchains like Polkadot or Solana results in high gas fees, making small transactions inconvenient.

Gas fees can fluctuate wildly depending on the number of transactions coming in, leading to high prices since they all compete for quicker validation.

By operating parallel to the Ethereum blockchain and acting as a highway for Ethereum assets, Polygon is able to avoid the low TPS issue and high gas price problem.

Who Created Polygon Finance?

Jaynti Kanani, Anurag Arjun, and Sandeep Nailwal founded Polygon in 2017. Since its Initial Exchange Offering (IEO) on Binance Launchpad, the project has received significant investments from well-known venture capital and investment firms, including Sequoia Capital, Steadview Capital, and Mark Cuban.

Originally known as the Matic network, Polygon rebranded itself in February 2021 to appeal to a more global audience. It expanded its original plan to include interoperability with other chains, similar to Polkadot. Polygon chose to retain the name MATIC for its token due to how ERC20 tokens are written into the Ethereum blockchain. As it repositioned itself as a potential layer-2 solution to Ethereum’s scaling and gas fee issues, the price of MATIC skyrocketed in 2021, as Polygon began competing with other layer-1 protocols like Binance Smart Chain (BSC), Solana (SOL), Avalanche (AVAX), Fantom (FTM), and Luna (RIP) for the loyalty of users and developers who were discouraged by ETH’s issues.

How Does Polygon Work?

Polygon has succeeded as a sidechain to Ethereum by implementing various scaling solutions and incentive structures to keep its network running optimally and efficiently.

A majority of its success comes from using a proof-of-stake (PoS) structure, which, if wellsupported, makes Polygon significantly cheaper to use. Being able to conduct cheap transactions allows GameFi and other emerging sectors of crypto to succeed without committing a large amount of capital to move assets. Validators also exist to allow delegators to stake their tokens to increase the overall speed of block creation, as well as to generate passive income for holders of MATIC tokens.

Polygon now allows developers to launch preset blockchain networks that can be designed to match a client’s desired specifications and needs.

The Future of the Polygon Ecosystem In the future, Polygon will support other side chains or enterprise chains that run on their own PoS system. However, only secure chains and stand-alone chains are currently supported, both of which are MATIC PoS blockchains.

Polygon is expected to support a wide range of blockchain scaling solutions to increase transaction throughput while maintaining security and usability. Optimistic Rollups, ZK-Rollups, Validium Chains, and more are already being utilized or expected to be used in the future as the total value locked (TVL) on the Polygon network increases.

Instead of merely acting as a highway for transactions, Polygon aims to become a platform for developers and companies to access a suite of tools compatible with Ethereum. DApps, DeFi protocols, and scalable blockchains will be able to interact with other Ethereumbased projects while still maintaining their sovereignty, making transactions nearly cost-free and allowing them to share information securely.

How to Use Polygon.

CoolWallet now supports Polygon (MATIC), the token used to settle payments and transaction fees on the Polygon network. Polygon is a layer-2 scaling solution for the Ethereum network. Parallel to Ethereum’s main blockchain, it offers faster transaction processing, higher TPS (transactions per second), and lower transaction fees. The CoolBitX Crypto App allows users to store MATIC natively and access and trade it.

MetaMask and Wallet Connect integrations allow users to connect to DeFi protocols as well. By using the appropriate wallet and some ready-totransfer Ether and MATIC, Ethereum can be bridged to Polygon in a few minutes.

Select “Custom RPC” in the network settings of your supported wallet to begin setting up the Polygon network independently on MetaMask. Enter the following information to start bridging your assets to Polygon:

Network Name: Polygon

Mainnet

New RPC URL: https://rpcmainnet.maticvigil.com/

Chain ID: 137

Currency symbol: MATIC

Block Explorer URL: https:// explorer.matic.network/

Wallets can now transfer assets to Polygon after saving the details.

Polygon allows users to trade and interact with dApps, NFT marketplaces, and blockchain games using assets like Ethereum and MATIC. To help users initiate transactions, https://matic.supply/ distributes a small amount of MATIC over time to wallets with zero MATIC.

Set your wallet’s network back to the Ethereum mainnet so you can connect it to the MATIC network website. A Polygon bridge will appear, where you can choose which asset to move. In addition to Ethereum gas fees, transactions take between 5-10 minutes. A web wallet’s main page allows you to view your assets.

Using Polygon, the most popular Ethereum layer-2, you can now easily trade your digital assets for decentralized applications such as QuickSwap and Aave.

Polygon: The Future of Ethereum Scalability

Polygon network is an exciting solution to Ethereum’s scalability problems, and it’s worth considering for developers and investors alike. Its PoS consensus mechanism and unique architecture make it a more scalable and affordable alternative to Ethereum. Moreover, its compatibility with Ethereum allows developers to move their projects to Polygon without making significant changes. Its diverse ecosystem of projects and applications, along with Matic’s staking rewards,

MetaMask and Wallet Connect

make it an attractive investment for those interested in DeFi. With its unique architecture, PoS consensus mechanism, and a diverse ecosystem of projects, Polygon offers numerous benefits to those interested in DeFi and cryptocurrency. Matic has been trading for around $2, with a market capitalization value of about $13 billion.

Matic tokens are dispersed monthly and have a total supply of 10 billion tokens, of which nearly 6.8 billion are already in circulation. Initially, the developers sold around 3.8% of Matic’s total supply in their initial private launch in 2017. Later, they had an initial exchange offering where they sold another 19% of their max supply. The development team owns 16% of the supply, while advisors have 4%, staking rewards come to around 12%, the ecosystem already has 23%, and around 22% went to the Polygon Foundation.