A Brief Dive into Polygon
With a market cap of $13 billion and an active users of 500k+ surpassing that of Ethereum’s as of last year in October — this project seems…
With a market cap of $13 billion and an active users of 500k+ surpassing that of Ethereum’s as of last year in October — this project seems to keep getting better and better with every new development.
So what exactly is Polygon and how does it function and what is it used for?
You’ll get to know this in simpler terms in this article. Stay tuned!
We can’t talk about Polygon without mentioning Ethereum. Ethereum is a decentralized open-source blockchain that uses smart contracts (it’s a self-executing coded agreement between two parties). Ethereum handles 30 transactions per second which are low compared to other crypto blockchains, making Ethereum slow and expensive.
This is what Polygon has come to solve, a cheap and fast blockchain while also leveraging Ethereum’s tech.
Polygon is a layer2 platform that allows Ethereum applications to tackle the difficulties of Ethereum (mentioned above) while also leveraging Ethereum’s security.
Polygon uses EVM code which makes it similar to Ethereum allowing developers to move to the Polygon chain easily. EVM stands for Ethereum Virtual Machine, it’s a software that allows developers to build on Ethereum.
Polygon currently has 7,000 dApps (decentralized applications).
The Polygon POS (Proof of Stake)
It’s a side chain to Ethereum which utilizes a Proof of Stake consensus mechanism.
Polygon is a series of blockchains that can help scale Ethereum, that’s why Polygon devs have created a different Ethereum scaling solutions ie ZK roll-ups and side-chains like Polygon Hermez, Polygon Avail, Polygon Edge, Polygon Nightfall, Polygon Miden, Polygon Zero, and Enterprise chain — most of these aren’t yet live, currently in development.
These side-chains and rollups bundle up data and save space on the Ethereum chain.
How exactly does Polygon work?
Polygon is a commit chain (a transaction network that works close to the real chain, Ethereum) that works alongside Ethereum using its Polygon POS and other scaling solutions.
But how exactly does it work? Well-in details Polygon groups clusters of transactions and processes them together before sending them to the main chain: Ethereum. Instead of Polygon sending the whole transaction data, it does this by taking a snapshot and sending it to the Ethereum chain — the Ethereum chain will understand the whole data without processing it. This makes Polygon very fast, handling 65,000 transactions per second.
We can’t talk about Polygon without getting to know its architecture.
The Ethereum Layer: This layer is made up of Eth smart contracts which are responsible for staking, transactions, and the interaction between Eth and other polygon chains.
2. The Security Layer: It works alongside Ethereum to provide validator services to give polygon an additional layer of security.
3. The Polygon Layer: This is the community of projects that are developed in polygon.
4. Execution Layer: This layer is the EVM layer. This layer’s function is to execute the smart contracts in a suitable way for both the developers and users.
The Tokenomics
The coin used in the Polygon chain for transactions is Matic. It has a total supply of 10 billion Matic tokens and a circulating supply of 7.6 billion Matic tokens. Matic is currently deflationary after it implemented Ethereum’s EIP1559 (Matic base transaction fees will be burned) upgrade.
The AWS of Web3 is aimed at scaling Ethereum and onboarding institutions to Defi through its numerous scaling solutions and roll-ups; some never seen before tech: Polygon Zero, Polygon Nightfall, Polygon Avail, Polygon Hermez, etc. In August 4, 2021 Hermez joined Polygon on $250million merger in which Polygon paid from its treasury. Also in December 9th of last year Polygon acquired an Eth scaling startup MIR protocol for $400m — this shows how dedicated Polygon is at scaling Ethereum. In the future, I’ll write on each of these out-of-the-world tech solutions. Stay tuned!
If you enjoyed this write-up and would like to reach out to me. This is my twitter handle —twitter.com/0xSalazar
Please remember to do your research. None of this is financial advice.