HOME>Blog>A Beginner's Guide To Polygon (MATIC)

A Beginner's Guide To Polygon (MATIC)

Educational
Polygon (MATIC)
Savl
Blogpost logo

Overview of Polygon (MATIC)

Polygon (MATIC) is an innovative advancement in the blockchain ecosystem. As an ERC-20 token on Ethereum, MATIC ensures compatibility with Ethereum-based applications and digital assets. Its main purpose is to create and connect blockchain networks, promoting seamless functionality. This has earned it the reputation of being "Ethereum's interconnected blockchain web.”

Polygon was co-founded by three individuals:

  • Jaynti Kanani: He served as the CEO of the project and was previously a data scientist at Housing.com. He also contributed to the Web3, Plasma, and WalletConnect projects before co-founding Polygon.
  • Sandeep Nailwal: He took on the role of COO at Polygon. Prior to this, he co-founded ScopeWeaver, and he has been involved in various blockchain projects and initiatives.
  • Anurag Arjun: He assumed the role of CPO (Chief Product Officer) at Polygon. Before co-founding the platform, he had experience in tech and product roles in multiple companies.

Polygon, formerly known as the Matic Network, was created in 2017 to address Ethereum's scalability issues. The co-founders introduced Plasma sidechains and a Proof-of-Stake (PoS) consensus mechanism to enhance transaction speeds and lower costs. This project provided key solutions for Ethereum's challenges.

The team changed their name from Matic Network to Polygon in February 2021 to reflect their expanded goal of creating a multi-chain ecosystem centered around Ethereum. Polygon improves Ethereum and connects different blockchain networks, promoting integration and collaboration in the future of blockchains.

Under The Hood: Polygon

Polygon uses a modified proof-of-stake consensus mechanism, allowing consensus to be reached with each block. This is different from traditional proof-of-stake, where multiple blocks are needed for consensus. Participants stake their MATIC tokens in the proof-of-stake method and validate transactions on the Polygon network to earn MATIC tokens as rewards.

The Polygon network, as a secondary scaling solution, aims to address the limitations of the Ethereum platform. These limitations include high transaction fees and slow transaction processing speeds. Polygon offers the following benefits:

  • Deploy established blockchain networks and create customized blockchains.
  • Enhance communication between Ethereum and other blockchains.
  • Assist current blockchain networks in achieving compatibility with Ethereum.

Polygon Pros & Cons

If you're considering buying MATIC, it's important to understand the major strengths and weaknesses of Polygon. Read on to learn about the advantages and disadvantages of Polygon.

Pros:

  1. Scalability: Polygon enhances the scalability of Ethereum-based projects by using sidechains, thereby allowing faster and cheaper transactions.
  2. Interoperability: It provides a framework for different blockchains to interact seamlessly, fostering a more interconnected blockchain environment.
  3. Cost-Efficient: Transactions on Polygon are significantly cheaper compared to those on the Ethereum mainnet.
  4. Security: Leveraging the security model of Ethereum, Polygon ensures the protection of assets and transactions on its network.
  5. Flexibility: Developers have the freedom to choose their consensus mechanism and other blockchain parameters.
  6. Ecosystem Growth: With its growing adoption, there's a rapidly expanding ecosystem of dApps, tools, and community projects built around Polygon.
  7. ERC-20 Compatibility: Being an ERC-20 token, MATIC is compatible with a wide array of Ethereum-based applications and platforms.

Cons:

  1. Complexity: The multi-layered structure of Polygon might be complex for newcomers to understand and interact with.
  2. Centralization Concerns: Some critics argue that by relying heavily on a few validators in its PoS system, Polygon might introduce centralization risks.
  3. Network Overload: With increasing adoption, there might be concerns about the network's ability to handle a large volume of transactions in the future.
  4. Smart Contract Risks: As with all platforms that support smart contracts, there's a risk of contract vulnerabilities and potential exploits.
  5. Rebranding Confusion: The transition from Matic Network to Polygon might have caused confusion among some users and investors.
  6. Competing Solutions: There are other layer-2 solutions and alternative blockchains also aiming to solve Ethereum's scalability and cost issues, which might impact Polygon's dominance in the space.

Polygon vs. Ethereum

Since its inception, Ethereum has been a pioneering blockchain platform for dApps and smart contracts. Despite its success, the network has faced scalability, speed, and cost challenges. The ongoing Ethereum 2.0 upgrade aims to address these issues by transitioning to a PoS consensus mechanism, among other improvements.

Polygon is a multi-chain scaling solution for Ethereum. It enables faster and more affordable transactions by using sidechains while maintaining security through Ethereum. In essence, Polygon complements Ethereum by enhancing scalability and interoperability for dApps and transactions.

Polygons Future

Polygon's trajectory in the blockchain space is promising. With its faster transaction speeds and reduced costs, Polygon's framework is a preferred choice for developers and businesses. As Ethereum remains the leading platform for decentralized applications, the demand for solutions like Polygon will likely surge. Collaborations and partnerships with other platforms and DeFi projects could further establish Polygon's foothold in the ecosystem.

Although the blockchain landscape is changing rapidly, Polygon appears to have a promising future. Ethereum 2.0, with its shift to Proof-of-Stake and other scalability solutions, may impact layer-2 solutions like Polygon. However, the Polygon team's adaptability and continuous innovation indicate their readiness to handle these changes. By focusing on user-centric solutions and expanding capabilities, Polygon has the potential to shape the future of blockchain technology.

In November 2021, Polygon launched Polygon Studios, a subsidiary focused on blockchain gaming and non-fungible tokens (NFTs). The success of Polygon Studios has the potential to establish Polygon as a prominent technology provider in the decentralized gaming and NFT space.

MATIC Trading History

For the majority of its history, Polygon's MATIC tokens have traded for less than 5 cents. While the price of MATIC has appreciated significantly, it has still remained below the all-time high of $2.92.

There are currently 9,309,803,041 MATICs in circulation from a total supply of 10,000,000,000 — in other words over 93% of the total supply are in circulation.

MATICs market cap stands at around $6,000,000,000 and at the time of writing this, 24 hour trading volume was $580,000,000.

Polygon (MATIC) is the #12 cryptocurrency according to CoinMarketCap.

How Can I Buy MATIC?

The easiest way to buy Polygon's MATIC tokens is through a major cryptocurrency exchange. We highly recommend that you store you MATIC in a non-custodial digital wallet like Savl Wallet, for example. Savl supports both the ERC-20 and BEP-20 varieties of MATIC token.

In Conclusion

Polygon (MATIC) is a groundbreaking blockchain solution that tackles the scalability and interoperability challenges faced by Ethereum. With its adaptive framework, it enables faster and more affordable transactions, paving the way for a seamless and interconnected blockchain future. Initiatives like Polygon Studios demonstrate its dedication to bridging mainstream industries and blockchain technologies. In essence, Polygon is at the forefront of shaping and redefining next-generation blockchain applications as the digital landscape evolves.

Note: Polygon (MATIC) is fully integrated into Savl Wallet where users can send, receive, swap and hold MATIC.

DISCLAIMER: All cryptocurrencies are high-risk investments and you should not expect to be protected if something goes wrong. Don't invest unless you're prepared to lose all the money you invest. The contents of this blog post do not constitute financial, legal or investment advice of any nature and are simply a reporting of publicly available facts and data. Savl does not and will not make financial or investment recommendations EVER. Your capital is always at risk.

Recent publications

Jun 11, 2024
Educational
DeFi (Decentralized Finance)

4 min.
Savl
May 30, 2024
Educational
Bitcoin Runes

6 min.
Savl