The cryptocurrency market is an unregulated market that runs 24×7 globally and hence it is very volatile. We have witnessed recently how a tweet from Elon Musk took a meme-based DOGE coin to the moon. And it is not only for DOGE coin but the first and most valuable cryptocurrency by market cap bitcoin (BTC) has been a victim of this many times. I am very sure you must be aware of the current DIP in the market after Elon suspended bitcoin payment over energy mining and environmental concerns.
In all this havoc, there is one cryptocurrency that is growing steadily and seems completely isolated from the recent market volatility. At press time, Polygon (MATIC) is currently trading at $1.97 with a market cap of ~$12 billion.
What is Polygon (previously Matic Network)?
Polygon is a Layer 2 solution for any blockchain. It works on top of any blockchain in order to increase scalability and reduce gas fees. It has been currently implemented on the ethereum network but will allow different blockchains to talk and transfer funds and information in a universal language. It is the internet of blockchains that solves the following core problem of the ethereum network –
- Low Throughput
- Poor UX (gas, delayed PoW finality)
- No sovereignty (shared throughput/clogging risk, tech stack not customizable, governance dependence)
Any developer who has tried to build a decentralized application used by the masses, on Ethereum layer-1 blockchain, knows that in its current manifestation, it isn’t quite ready. Transactions take a long time to clear and paying for every basic function is expensive and creates a poor user experience. It all boils down to a general ‘scalability’ problem. Both poor throughput and cost have been massive barriers to any meaningful adoption.
The main reason behind Ethereum’s scalability bottleneck is that each node in the network has to process each transaction. Remember that nodes perform the job of verifying that the miners’ work is valid. They play an integral role within the network as they’re the main check on the miners if they decide to act maliciously. Similarly, each node keeps an accurate copy of the current network state, meaning they don’t need to rely on a third party to confirm the balance of every account and smart contract.
Reasons for Polygon’s (previously Matic Network) steady growth
There are a couple of sticking points for Polygon that are the main drivers for its growth: lower gas fees, fast transactions, and platform usability. It’s not surprising to see Ethereum gas fees slowing down the motivation for DeFi applications recently. However, unlike other Ethereum-based ecosystems, Polygon looks to bring other advantages to the table too.
Major features include validation system security, scalability by way of joint PoS consensus and Heimdall architecture, and PoS chain Plasma.
Polygon’s supported leading DApps in DeFi include QuickSwap, Aave, and ParaSwap – Aave made the expansion over to Polygon in March. QuickSwap reported a 210% user increase last week, and a 240% increase in transactions over the same period.Tweet
As per DappRadar materials, the top twenty Polygon DApps interacted with more than 75,000 active user wallets in just the past week. Finally, in the past month, Polygon-tracked DApps on DappRadar increased from 61 to 93; 46 of those fall in the DeFi and Exchange categories.
Bitly, the company behind the Ethermine pool, also announced today that they will onboard their 300,000 miners to Polygon on June 1st. They also feel that it is a better experience for miners & more block space for the ethereum community and have requested smaller miners to use Polygon / Matic to receive prompt payouts.