What Is Polygon(MATIC) ?

Polygon is a suite of scaling solutions that aims to improve the performance of the Ethereum network. It provides a framework to build interconnected blockchain networks and offers solutions like sidechains and rollups to increase transaction speed, lower fees, and enhance scalability on Ethereum. The native token MATIC facilitates operations on Polygon sidechains. Polygon intends to make Ethereum transactions faster, cheaper, and more efficient.

History of Polygon(MATIC)

Who created Polygon?

Polygon was launched in 2017 by Indian developers under their original name Matic Network. Polygon is jointly founded by Jaynti Kanani, Sandeep Nailwal, Anurag Arjun and Mihailo Bjelic. Jaynti Kanani and Sandeep Nailwal are the core founders and leaders of Polygon. Polygon was originally a solution that focused on using Plasma side chains to expand Ethereum. It was later renamed from Matic Network to Polygon in 2021.

History

• 2017 - Polygon founded as MATIC Network by Jaynti Kanani, Sandeep Nailwal, Anurag Arjun and Mihailo Bjelic.
• 2020 - MATIC Network launched its mainnet.
• 2021 - MATIC Network rebranded as Polygon, expanding its vision beyond an Ethereum sidechain.
• 2023 - Polygon unveiled its Polygon 2.0 vision to transform into a network of interconnected zk-powered chains.

How Does Polygon (MATIC) Work?

Polygon functions as a Layer 2 scaling solution that aims to tackle the issues of high gas fees and low throughput on the Ethereum blockchain. It operates sidechains that connect to the Ethereum mainnet while benefiting from the security guarantees of the Ethereum network.

Sidechains and Ethereum Compatibility

These sidechains run parallel to Ethereum and can process transactions independently while deriving security from the main network. They utilize a modified Proof-of-Stake consensus that allows token holders to validate transactions and earn rewards for their participation.

Ethereum Virtual Machine (EVM) Compatibility

A key advantage of Polygon is its compatibility with the Ethereum Virtual Machine (EVM). This allows decentralized applications built on Ethereum to be ported easily to Polygon sidechains without any major code modifications. Developers can leverage the same tools and programming languages to build dapps and smart contracts on Polygon as they would on Ethereum.

Gas Fees and Utility of MATIC

The native cryptocurrency of Polygon is MATIC. It serves as the gas fee for executing transactions on the Polygon network. MATIC tokens can also be staked as collateral to become validators and take part in the Proof-of-Stake consensus mechanism. In addition, MATIC facilitates governance activities like voting on network upgrades.

In summary, Polygon aims to scale Ethereum and reduce congestion by processing transactions on sidechains in parallel while maintaining seamless compatibility with the Ethereum ecosystem. The use of MATIC and PoS consensus provides economic incentives for validation and participation in network governance.

Tokenomics

What is Polygon(MATIC) used for?

MATIC is the native cryptocurrency that powers the Polygon network. It fulfils several core functions:

1. MATIC is used to pay gas fees for executing transactions and interacting with dApps on Polygon. This replaces the need for ETH.
2. Polygon employs a Proof-of-Stake consensus, so MATIC can be staked to become a validator, securing the network and governing decisions.
3. Staking MATIC also allows participation in Polygon's governance system to influence developmental decisions.
4. Users can supply MATIC liquidity to Polygon's protocol to facilitate trading and earn rewards.
5. MATIC enhances Ethereum's scalability by enabling faster and cheaper transactions on Polygon sidechains

How Many MATIC Coins are There?

The maximum supply is 10,000,000,000.

Token Distribution

• private sale (seed round + early supporters）: 3.8%
• Binance Launchpad: 19%
• Team: 16%
• Advisors: 4%
• Staking Rewards: 12%
• Foundation: 21.86%
• Ecosystem: 23.33%

Why is Polygon (MATIC) Valuable?

Polygon (MATIC) derives its value from its functionality and features as a layer-2 scaling solution for Ethereum. As a layer 2 solution, Polygon brings multiple benefits to the Ethereum ecosystem by providing a platform to scale and connect to the Ethereum network. Here are the sources of Polygon's value:

• Scaling solution: Polygon, as a layer-2 scaling solution for Ethereum, can process more transactions and reduce transaction costs. This means that more transactions can be processed on the Polygon network without unduly burdening the main Ethereum network. For example, when the Ethereum network is congested, users can choose to execute transactions on the Polygon network, thus avoiding high gas fees1.
• Connecting the Ethereum ecosystem: Polygon provides a platform where other blockchain projects can connect and interact with the Ethereum network. This brings more diversity and flexibility to the Ethereum ecosystem, while also providing more options for developers and users. For example, Polygon's layer 2 network can support more decentralized applications (DApps) and digital assets, enriching the functionality of the Ethereum ecosystem2.
• Reduced gas fees: Thanks to Polygon, transactions on the Ethereum network can be cheaper and more efficient. Polygon's layer 2 network can reduce the gas fees required for transactions, making participation in the Ethereum ecosystem affordable for ordinary users. This opens up opportunities for more users and projects to participate in the Ethereum ecosystem3.

As such, Polygon's value comes from its scalability, connectivity, and reduced gas fees that it brings as Ethereum's Layer 2 scaling solution.

Highlights

Polygon has reached several important milestones in its development process:

• Rebranding and Expansion: In February 2021, Matic Network changed its name to Polygon and expanded its vision and scope to become a platform for building and connecting Ethereum-compatible blockchain networks
• Partnerships and Developments: Polygon has partnered with several projects and platforms, such as Aave, Decentraland, SushiSwap, and OpenSea, to integrate its extended technologies and grow its ecosystem.
• Polygon 2.0: Polygon 2.0 is a series of enhancements aimed at transforming the Polygon ecosystem, aiming to create interconnected zk-powered Layer 2 chains.