What Is Polygon?

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The Ethereum ecosystem is the largest and most vibrant of smart contracts compatible Layer 1 blockchain. However, high transaction fees on the Ethereum network have alienated investors from this product. High gas fees on the Ethereum network have led to the development of rival blockchains — such as Cardano, Solana, Avalanche — sometimes referred to as ETH killers. Although these blockchains are often faster and cheaper than Ethereum, they lack the security and the network effect of Ethereum's massive user base. 

Layer 2 solutions are applications created to help scale a blockchain. Examples of Layer 2 solutions are the Bitcoin Lightning network, Arbitrum and Polygon Crypto. These Layer 2 solutions process transactions off the mainnet, or Layer 1, and post them back in groups using rollups. Layer 2 solutions help increase transaction speed and reduce gas fees while still providing the security and decentralization of the mainnet. Layer 2 solutions are also often referred to as sidechains.

Overview of Polygon

Polygon is a Layer 2 scaling solution for the Ethereum blockchain. Polygon acts as a faster blockchain running concurrently alongside the Ethereum blockchain that uses multiple sidechains. These sidechains operate using the following methods to help improve scalability methods.

• ZK-Rollups: ZK-rollups process multiple transfers off the Ethereum mainnet. These transfers are then bundled into a single transaction and posted to the mainnet.  This process reduces the volume of transactions and the amount of data being processed on the Ethereum mainnet, enabling cheaper and faster transactions. 

• Plasma chains: Plasma chains are blockchains that run alongside the Ethereum mainnet. The two blockchains can communicate with each other and allow assets to travel between them. Plasma chains have a consensus mechanism that creates blocks, and the root of each plasma chain block is published to the Ethereum mainnet. These roots are little pieces of information that can be used to prove the contents of those blocks.

• Optimistic rollups: Optimistic rollups are similar to ZK-rollups, except that they assume transactions are valid by default. They only run computations in the event the integrity of a transaction is challenged.

The MATIC token is Polygon’s native cryptocurrency. MATIC, an ERC-20 token, is used for staking, fees and governance.

Why Do People Use Polygon?

People use Polygon because of its fast transaction speeds and low gas fees. Gas fees on Polygon are often just a couple of cents, far lower than those charged on Ethereum. People also use Polygon because the network benefits from the strong security of the Ethereum blockchain, and it can benefit someone who wishes to be a contributor to the blockchain technology. 

Polygon History

Polygon was launched in October 2017 as the Matic Network. Polygon was co-founded in Mumbai, India, by developers Anurag Arjun, Jaynti Kanani and Sandeep Nailwal. Kanani was a former data scientist at Housing.com before helping found Polygon and serving as the company’s CEO. Nailwal was the previous chief technology officer (CTO) of Welspun Group. He also worked as a consultant at Deloitte and started another company known as ScopeWeaver. Arjun worked as a project manager at IRIS Business, SNL Financial and Dexter Consultancy. Matic was rebranded as Polygon in February 2021 to reflect its wide array of scaling solutions. 

Where To Buy MATIC

MATIC can be purchased from most centralized exchanges such as Voyager, Crypto.com and Binance. MATIC can also be purchased from decentralized exchanges such as Uniswap and MetaMask Swap. Polygon uses a proof-of-stake consensus mechanism. If you already own MATIC, you can earn more of it by staking and buy cryptocurrency to diversify your portfolio along with the Polygons you already hold.

Polygon vs. Other Blockchains

The Polygon blockchain fundamentally differs from other blockchains such as Bitcoin and Solana because it relies heavily on another blockchain for its security. Polygon is in effect a part of the greater Ethereum ecosystem. 

Arbitrum is another Ethereum Layer 2 scaling solution. Arbitrum is slightly more decentralized because it is secured by Ethereum’s large network of miners. Polygon, on the other hand, is secured by MATIC staking, which is a smaller pool of capital when compared to the miners who secure the Ethereum network. Polygon is slightly cheaper to use and has faster withdrawal times when transitioning your assets back onto the Ethereum Network. 

How to Store MATIC Safely

If you wish to purchase a large sum of MATIC tokens, it is crucial to take the proper precautions to store your cryptocurrencies safely. The best place to store your MATIC tokens is on the hardware wallet Ledger. 

Ledger is a hardware cryptocurrency wallet that stores access to your cryptocurrencies on an external device. Ledger wallets are not connected to the internet. This feature is beneficial because hot wallets that are connected to the internet are much more likely to be exposed to scams, hacks and private key leaks. Ledger wallets are currently priced at around $60 to $250 depending on the model you choose. 

Should You Use Polygon?

Polygon is a scaling solution for the growing cryptographer that aims to improve the speed and reduce the cost of using the Ethereum blockchain. The company not only helps bring new cost-conscious users into the Ethereum ecosystem, but it also retains existing users. Many Ethereum projects are in the process of deploying on Polygon, and the Polygon Labs ecosystem is only expected to grow and add scaling solutions over time. However, the Ethereum 2.0 upgrade risks rendering Ethereum’s Layer 2 solutions less valuable as the mainnet scalability improves. 

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