What is Polygon?

Polygon is a decentralized platform that was primarily developed to enable blockchain networks to connect and scale. It is categorized as a secondary scaling solution, not a replacement for a primary blockchain network, based on Ethereum. It gives decentralized applications (DApps) the opportunity to take advantage of additional features while enjoying the benefits of Ethereum.

Polygon has its own cryptocurrency, and as of February 2023, it has a total market value of more than $12.2 billion. This makes Polygon the ninth-most valuable cryptocurrency project on the planet ahead of Dogecoin, Solana, Polkadot, and Litecoin — which is especially impressive when you consider that Polygon made its official debut only five years ago.

In this AAG Academy guide, we’ll explain in detail what Polygon is, who invented it, and how it works. We’ll also look at how the Polygon network can be used, cover its many pros and cons, and answer some frequently asked questions about the project.

What is Polygon cryptocurrency?

The Polygon network is a secondary layer that can be used on top of the Ethereum blockchain. It offers developers a number of advantages over using Ethereum by itself without losing the numerous benefits Ethereum has become famous for, including its flexibility, security, and widespread compatibility with a large and growing catalog of popular DApps.

Polygon was originally developed by four software engineers — Jaynti Kanani, Sandeep Nailwal, Anurag Arjun, and Mihailo Bjelic — based in Mumbai, India. It first launched as the Matic Network in 2017 before being rebranded as Polygon in February 2021, at which point it began to put more emphasis on being a leading Web3 and Metaverse company.

Polygon’s primary objective is to address the limitations that come with using the core Ethereum network by itself, especially its high transaction fees and slow transaction times. It uses the same proof-of-stake (PoS) consensus mechanism as Ethereum, but it is a modified version that enables consensus to be achieved with every block, rather than with many blocks.

This significantly speeds up the process of confirming transactions. The average processing time on Polygon is just 2.1 seconds, however, on Ethereum itself, it can take anywhere from five minutes to four hours. Its speed also allows Polygon to keep its transaction fees affordable at just $0.01 on average, whereas Ethereum fees are currently just under $6.

What is MATIC?

MATIC is Polygon’s native cryptocurrency token, and it is used to govern and secure the network, as well as pay transaction fees. There are currently around 8.73 billion MATIC tokens in circulation, and it has a maximum supply of 10 billion. MATIC is an ERC-20 token, which means it is fully compatible with the Ethereum blockchain and other ERC-20 currencies.

As things stand, a single MATIC token is worth $1.40. Its all-time high, which was reached in December 2021, was just over $2.72. Following the cryptocurrency crash in 2022, MATIC’s value — and therefore the overall market value of Polygon — has continued to increase steadily. Like all cryptocurrencies, however, MATIC is volatile and its price fluctuates all the time.

How does Polygon work?

As we touched on above, Polygon is a secondary scaling solution, also known as a Layer 2 or “sidechain,” that sits on top of the Ethereum blockchain. In other words, Polygon cannot function without Ethereum as its foundation or “mainnet,” but Ethereum can function without Polygon. 

If we imagine the Ethereum blockchain as a highway, Polygon would be a separate road that runs alongside it. The highway carries more cars, and it tends to get congested and bogged down as cars are continually entering and exiting it. The secondary road does not have this problem, so it runs quickly and smoothly at all times.

What makes these roads special is that they are tightly connected, so at any time, cars can switch from one road to the other. Furthermore, Polygon isn’t the only secondary road; there are lots of these — each with their own benefits and attributes — that traffic can freely move in and out of. Loopring, Arbitrum, and Skale are all Layer 2 scaling solutions for Ethereum.

What’s more, there are multiple flavors of Polygon that developers can take advantage of. In addition to the original PoS system, which operates primarily through commit chains that bundle batches of transactions en masse before confirming them and then returning them to the Ethereum mainnet, there are also systems like Miden and Zero that use zk-rollups.

Zk-rollup, also known as zero-knowledge rollup, is a system that also bundles batches of transactions before confirming them, but rather than submitting them to the mainnet individually, it turns them into a single transaction. Instead of having to worry about a large number of transactions, which would require a lot of time and resources, it only has to deal with one.

Pros and cons of Polygon

Using Polygon as a secondary layer gives DApps three key benefits, which are:

• Ethereum: By using the largest open-source blockchain in the world as its base layer, Polygon DApps are fully compatible with all things Ethereum, including established coding languages, its reliable tech stack, and the ETH token.

• Scalability: The sheer size of Ethereum means that scalability is an issue, which is why the network gets bogged down and fees become incredibly expensive when it is busy. Polygon doesn’t have this problem because it works a lot faster.

• Security: Developers have the option to use either Ethereum’s own security protocols, or those offered by Polygon and its pool of professional validators.

In a nutshell, Polygon allows for a smoother experience, and most importantly faster, more affordable transactions. It is capable of processing up to 65,000 transactions per second, which is significantly greater than the 14 per second that Ethereum can support. What’s more, Polygon charges very low fees, while those on Ethereum have been known to exceed $80.

However, Polygon does have its cons as well. The fact that it relies so heavily on the Ethereum mainnet — and it’s a standalone blockchain — means that if Ethereum ever experiences an outage or disruption of any kind, it would affect Polygon, too. In addition, it’s worth noting that there are limited use cases for the MATIC token as things stand.

As we mentioned above, the primary purpose of MATIC is to govern and secure the Polygon network, and to pay for gas fees. However, MATIC is typically not used for more general purposes, such as paying for goods and services.

How do I use the Polygon network?

You can use the Polygon network yourself by acquiring MATIC tokens, which are available from a wide range of centralized and decentralized exchanges, including Binance, Coinbase, and Uniswap. These can then be accessed via your centralized or decentralized wallet, and can then be used to pay transaction fees when sending assets via the Polygon network.

References

• Polygon matic definition
• What is polygon
• What is polygon matic and why it matters for ethereum
• Polygon blockchain explained a beginners guide to matic