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Polygon A Liberal Cryptocurrency | Polygon Explained

Image by Stampf from Pixabay 
Every now and then i somehow manage to spot a cryptocurrency gem long before it really takes off, Matic is one example of such a gem. Why In less than two months, it's gone up more than 10X? Why it is the most liberal cryptocurrency ? Well simply because it promotes equality(which is explained in detail further) as it has answers to Ethereum layer two scaling problems . Today, I'm going to explain what Polygon is and what it could mean for the Matic token. Before we continue, there's a disclaimer I need to give you. I am not a Financial Advisor. This is blog post is only for educational purposes Sorry. If you're new here, you might be feeling a little bit lost right about now. My name is "MrCrypt "and I am your crypto geek here at the cryptolibrarynow . I pass on the knowledge of cryptocurrencies, exchanges, DeFi, protocols, NFTS and market analysis are just a few of the topics I tackle on the daily basis. Now enough with the intro. Let's get it on with Polygon. 

Polygon  Founders and history -:

If you missed my previous video about Matic, here's the TLDR. Matic Network was founded in 2017 by Jayanti Kanani , Sandeep Nailwal and Anurag Arjun. I hope I pronounce those correctly. All three are seasoned software developers and jayanti is one of the architects of more viable plasma. An improved version of the plasma scaling solution for Ethereum, originally proposed by Ethereum founder Vitalik Buterin in 2017. Without getting into the weeds, more viable plasma works by creating copies of the Ethereum blockchain called child chains, which periodically submits snapshots of their states to the parent chain. This parent chain is, of course, Ethereum, but Matic network was designed to be blockchain agnostic, meaning any other blockchain can serve as the parent chain. In addition, Matic network incorporates a second blockchain in its architecture, which submits snapshots of the matic plasma chain to the Ethereum blockchain. This second blockchain is called heimdall and it uses a delegated proof of stake consensus mechanism. Naturally, staking is done using the Matic token and staking rewards range between 4% to 420% per year depending on how much of matic's total supply is being staked. The Magic token is also used to pay for transaction fees on the plasma chain, which is called bore. I'll get back to the Matic token in a bit. It is worth pointing out that the bore layer only has a maximum of 10 validators compared to the 120 validator limit of the hiemdall layer and all the validators on the four layer seem to be run by the Matic team. He thinks that this centralization is why the Matic network can handle between 7 to 10. 1000 transactions per second. The Matic network main net launched in May last year, not long after India lifted its first cryptocurrency ban. On that note, you should know that Mattic cofounder Sandeep Nailwal thinks that all this FUD around a second cryptocurrency ban in India is straight up BS. This is because India has a constitution that is not all that different from the US Constitution, and passing such a law would be deemed unconstitutional. Moreover, Indian officials see Bitcoin in a different light now that companies like Tesla have begun holding BTC as a hedge against the relentless money printing by governments around the world, you could say.

Polygon Rebranding -:

Just two weeks after I covered Matic network, they rebranded to Polygon. This rebranding signalled Matic shift in focus from providing a single scaling solution to becoming quote Ethereum's Internet of blockchains. In other words, Polygon wants to become the one stop shop for everything ethereum in addition to their existing plasma chain . Polygon is developing other layer 2 blockchains for Ethereum, which leverage ZK rollups and optimistic rollups. The Polygon SDK will make it possible to deploy these blockchains with a single click. You'll also be able to create standalone blockchains using the Polygon SDK and all these blockchains will be interoperable. I'll explain how that works in a moment. Now, if this project sounds awfully similar to what projects like Cosmos and Polkadot are trying to do well, you'd be correct. The difference is that Polygon chains will be able to leverage the security. Robustness and network effects of the Ethereum blockchain in the same way the original Matic network has. This also means that Polygon is not a competitor to Ethereum like those other smart contract cryptos. To clarify, the matic network is still alive and well, it's just become the first of many blockchain networks that will make up the Polygon ecosystem. More importantly, the Matic token will continue to be the token, which powers not just the Matic network. But the entire Polygon ecosystem.

Polygon Explained -:

Polygon actually has an architecture of its own that's divided into four layers. The first is the Ethereum layer, which all polygons layer 2 blockchains will rely on for security and consensus. The second layer is the security layer which will handle Polygon security as a service product. This service lets any Polygon blockchain tap polygon's core validators for security and consensus for a fee. If they don't want to leverage the Ethereum blockchain. Security as a service is also optional, meaning polygons first two layers are not mandatory per say. The third layer is the Polygon networks layer, which handles interoperability between all blockchains created using the Polygon SDK. The fourth layer is the execution layer, which hosts on chain and cross chain smart contracts. Now if this sounds complex, it's because it is. The Polygon White Paper is 70 pages long and I promise you that there is no beating around the Bush going on there. Thankfully, there is an image from that White Paper which explains how Polygon works much better than their website as you can see, polygons architecture is quite similar to polka dots. Again, the difference is that Polygon chains have the option of leaning on the Ethereum blockchain for security and consensus. This is important because layer two blockchains which use plasma and rollups may give possible to reclaim user funds if anything goes Wrong on these chains. This can be done by referencing the last snapshot or rolled up transaction left on Ethereum by that layer 2 blockchain. If something goes wrong on a para chain on Polkadot, something tells me you're going to be out of luck if anything happens to your tokens. That said, Polygon is still very much in its infancy and there don't seem to be any other solutions available besides the Matic network at the time of shooting. This is probably why Polygon has been enlisting heavy hitting ethereum developers as advisors since it revealed its master plan. Given all the developments and partnerships that have taken place since the rebrand, polygon seems to be right on track to be ethereum 's  Swiss army knife. 

Polygon Updates -:

In mid February, the graph added support for Polygon, making it possible for developers to index data from the Dapps built on polygons various blockchains. One week later, Polygon partnered with Chain Link to introduce verifiable randomness to the Polygon ecosystem. This is significant because it will introduce new use cases related to gaming and gambling, which rely on random number generation. I suspect the chain link VRF will come in handy for Polygon subsequent partnership with Atari. This is because Atari also partnered with Decentraland to build a virtual cryptocurrency casino that will be powered by yeah, you guessed it, Polygon. Polygon will also be supporting Atari ATRI token and will be hosting Atari's upcoming NFT platform. Speaking of NFTS, some of you might remember that      Avegotchi had announced in January that it was going to launch on Matic network because of Ethereum's insane gas fees. Avegotchi  , finally launched on March the 2nd, and all 10,000 of its pre minted NFTS sold out within 60 seconds. In contrast to regular NFT's Avegotchi  NFTS are actually made using interest bearing A tokens that lenders get from locking their crypto. On average, this means you can get a more realistic valuation of how much each  Avegotchi  is worth. It's also nice that Avegotchi  seemed to be destroyed to redeem these interest bearing a tokens. At least their holders will have something left if the NFT bubble does indeed burst. If you want to learn more about cryptocurrencies NFT market, be sure to watch my video about it by using that link in the top right when you get a moment. The last big announcement about Polygon is one you might have heard about, and that's Coinbase's listing of the Matic token in early March. This had a predictable effect on matic 's price action.

Polygon Mass Adoption -:

As I mentioned in the introduction, Matic has seen a 10X increase since the start of the year. The timeline of the various announcements I just detailed seems to coincide quite nicely with Mattix price action. It's not just hype that's had the Matic token on the move though. The dapps built on Polygon are seeing some serious adoption in February. Probably logged over 200,000 unique users on the Matic network. There are around 100 dapps built on the Matic network, though most of these don't seem to have very much engagement. The largest app on Polygon by TVL is currently Quickswap , a Uni swap clone which currently holds over $100 million in crypto. Now, that doesn't sound like much, but it's the highest TVL of any layer two decks by a wide margin. The fastest growing dapp on Polygon seems to be decentral games, which hosts gambling games in Decentraland. The Pride and joy of Polygon, however, is Poly Market, which I'm quite certain is the current leader in the decentralized predictions market. On Poly Market, you're able to bet on the outcomes of certain events such as elections, and can actually take profits at anytime. This is convenient because you don't have to wait for the actual outcome that you're betting on to make it quick buck. If you're wondering why these dapp's matter thematic, it's because the Matic token is used to pay for all the transaction fees on these Daaps given the surge in demand for NFTS and virtual worlds, it's only logical to assume that the demand for Matic will continue to grow, so this begs the question, how high could matic go? 

Matic Price Prediction-:

Matic Price
Image by Gerd Altmann from Pixabay 

The interesting thing about the Matic token is that even though it's used for staking, it has a fixed supply of 10 billion. If you watched my previous video about Matic, you'll recall that 22% of this supply was sold between the private sale and IEO, 12% of the supply was reserved for staking rewards, and the rest was allocated to the Matic network team. Advisors and foundation. These tokens are subject to a three-year vesting schedule with six month unlock periods. Almost half of these tokens have been set aside for staking rewards and Polygon hopes that the network will be busy enough to reward validators and delegators using fees alone. In the meantime, though, there are a lot of tokens coming on the market every six months. We seem to be right at the start of one of these six month cliffs and this flood of supply could seriously suppress the impressive price action we've recently seen in the short term. In the long term, I think it's pretty clear where Matic is headed. Given that Matic has a fixed supply, a low market cap, and underpins a network that is increasing in utility by the day, I think a 10X move from its current price point is a realistic expectation. However, this all depends on what happens to the demand for Polygon when a theorem implements its own native scaling solution. Later this month.

Ethereum 2.0 is a Polygon Killer ?

In case you didn't hear the news, Ethereum is scheduled to release an update to its network by the end of March. That could solve many of its scaling issues overnight. Optimism has been in the works for well over a year, and unlike other layer two scaling solutions, it does not have a token and was conceived essentially with the express purpose of scaling Ethereum. Leading Ethereum dapps like     Uni Swap and Synthetics are already preparing to launch on optimism and exchanges like Coinbase are ready to support deposits and withdraws directly from the optimism layer. Once optimism goes live. I think this is going to put a dent in Polygon and other layer twos. This is because the main selling point for these crypto projects is that they alleviate issues related to slow speeds and high gas fees on the Ethereum blockchain. Optimism does that too and seems to have the edge when it comes to network effects and adoption, even though it hasn't technically launched yet.To make matters worse for Polygon, cofounder Sandy Naliwal noted in a recent interview that they're having a really hard time finding developers to build out their new ecosystem. In his words, quote there are 2000 blockchains and 50 developers in the cryptocurrency space. There's one thing I think could protect Polygon, however, and it's something I mentioned in my previous video about matic. As you might have guessed, the Avegotchi NFT game was funded by AAVE one of the largest decentralized borrowing and lending protocols on Ethereum. Given the incredible success Avegotchii have had so far, this might just entice Aave to launch a version of its protocol on Polygon. This wouldn't be very hard to do, since a special bridge for interest bearing tokens already exists between ETHEREUM and the Matic network. Although I've yet to see any evidence of RA's intentions to launch on Polygon, I think that it's very much within the realms of possibility. Not only that, but if anything goes wrong with optimism, you can bet that Polygon is going to be the first layer 2 Ethereum dapps we'll go to. Oh, and if India somehow does ban cryptocurrencies, Sandeep Naliwal says. It will have zero effect on Polygon since the nodes the team is running are geographically decentralized. Something tells me the Matic token wouldn't do too well, though if that would happen. Good thing I'm in this for the tech eh.

Will Polygon make you rich ?

Believe it or not, Polygon might just be one of the most promising projects in the cryptocurrency space. Besides the incredible technology its team has developed, Polygon also has deep roots in Ethereum history. I've lost count of the number of projects polygons partnered with since it rebranded much less all of the partnerships it had announced before it rebranded. The thing is, I haven't really heard about these partnerships in the crypto media, nor have I even seen them disclosed on polygons or matics blog posts on medium. Almost all these updates are coming from Twitter, which is probably why they have a lot of followers. The bigger problem though, is that I haven't really seen any progress for many of these partnerships. I suspect this has something to do with the dev shortage. The cryptocurrency space is experiencing. As someone who's analysed the cryptocurrency job market in the past, I can sympathize with Sandy when he says they're facing a labour shortage. When I put on my thinking cap, it makes me wonder why Matic would rebrand to Polygon if they knew they would have a hard time getting enough hands on deck for such a massive project. Now I might be wrong, but I think the rebrand might just have been a marketing tactic. Give the project enough momentum to spark with Ethereum's incoming inhouse scaling solutions. I remember that many cryptocurrency projects rebranded during the last bull market, just so they could stay in the spotlight. If this is the case with Polygon, it wouldn't surprise me and I wouldn't blame them either. There are over 8000 cryptocurrency projects competing for attention and investment. For context, there were just over 1000 cryptocurrency projects during the last bull market. Luckily for Polygon, they are an objectively valuable project with a lot of potential. I think that this will reflect in the price of the Matic token, no matter what happens with optimism or other competing layer two projects. If you enjoyed this article, give the google search algorithm a hint by sharing this blog post. Thank you for reading this article, and I'll see you all sooner than you think.

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