Table of Contents
Introductions
What is Polygon MATIC, one of the most exciting projects in the cryptocurrency space. It attempts to solve a very deeply-rooted problem in the industry.
Scalability is a significant problem that has plagued the Ethereum ecosystem and all cryptocurrencies. Scalability refers, in simple terms, to the ability for a Blockchain and its consensus algorithm to increase transactions per second (or the TPS) as the number users joins the network. This is an issue that the major cryptocurrencies (e.g. Bitcoin and Ethereum) are currently addressing. However, these protocols must deliver significantly more outstanding performance as retail adoption increases, and institutional adoption grows.
Lightning Network exists only for Bitcoin. The discourse around Ethereum is different. A much more accessible and flexible ecosystem makes it easier for researchers and developers to find solutions to allow ETH scaling globally. It is expected that Ethereum 2.0 will be released in a manner in 2022. The community is currently looking for layer two solutions to allow the community to address today’s issues while still being able to build a partnership with the next project.
What is Polygon (MATIC)?
Polygon is a fascinating project in this space. In recent weeks it attracted the interest of DeFi’s most prominent protocols and many users seeking an escape from high gas fees. Its token MATIC, which has an average capitalization of $15 billion, has seen its value increase by +350% during recent months. In 2017 a group of Indian developers started the project. They wanted to create two leading solutions for Ethereum’s scaling issue. The token was distributed via IEO through the Binance Exchange in April 2019. This raised over $5.5million and saw the project take shape around mid-2020.
Despite being a young protocol, developers, investors and users began to notice it due to the steady rise in the Ethereum Blockchain transaction cost. Polygon created a stand-alone ecosystem that could adapt to all the protocols. This was the team’s idea. Polygon suggests a Layer 2 system that is simpler than the “simple” Layer 2. It also includes Layer 2 (with Plasma Rollup and Optimistic Rollup algorithms), as well Sidechains. Blockchains with Ethereum one, but using different consensus algorithms and rules ).
The architecture of the ecosystem has many parts that interact with each other.
* Ethereum Layer 1: This is designed to communicate and stake between Polygon network and the Ethereum Mainnet
* Security Layer, which is used to validate content that has been added to multiple chains, can take many forms and have internal structures to adjust to eventualities.
* Polygon Network Layer. This is a collection of chains that are governed by their own rules. It can be used to handle block production, transactions, and consensus.
* Execution Level, where transactions are actually executed.
The strength and uniqueness of this project is its ability to adapt to any protocol or situation in Ethereum. A DeFi protocol like Aave, in which billions are invested in Smart Contracts, will interest this project more than a DeFi protocol like Aave. They will therefore be more likely to seek out Sidechains and security solutions. A marketplace or application for NFT will, on the contrary, be interested only in the speed of transactions as well as the low gas fee.
Polygon Ecosystem
Projects can thus improve the essential parts of their project by focusing more on security, transaction time, sovereignty, or the cost of fees to be paid. This solution is excellent for current scaling issues. It integrates seamlessly with Ethereum and promises an exciting future for Ethereum, the second-largest cryptocurrency in terms of capitalization.
