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Polygon Blockchain Explained: A Beginner’s Guide To MATIC

8 minutes 5 months ago

The Ethereum ecosystem is one of the biggest and most vibrant Layer 1 blockchains compatible with smart contracts. However, when the Ethereum network encounters high levels of traffic, there can be expensive transaction costs. These costs have alienated some of its users and led to the development of competitors, such as Cardano, Solana, and Avalanche. Though these blockchains can be quicker and less expensive than Ethereum.

Layer 2 solutions assist a blockchain in scaling. They process Layer 1 transactions off the mainnet or Layer 1 network and publish them back in groups using rollups, a rollup is a collection of transactions. Layer 2 solutions (also referred to as sidechains) such as Polygon boost transaction speed and decrease gas expenses while maintaining the mainnet’s security and decentralisation.

What is Polygon (MATIC)?

Polygon is one of the first well-structured “layer two” or “sidechain” scaling solutions that operates concurrently with the Ethereum blockchain, enabling fast transactions and low fees. The Polygon network solves some of Ethereum’s issues by processing transactions on a second blockchain that is compatible with Ethereum.

Polygon returns transactions to the regular Ethereum network post-processing. This reduces Ethereum’s network load, thus expediting transactions and reducing transaction costs. In other words, Polygon, previously known as the Matic network and initially developed in 2017, offers a simple architecture for blockchain applications to build on Ethereum without traditional scalability difficulties.

Users can interact with any decentralised application (DApp) using Polygon without worrying about network congestion.

How Polygon works

Polygon is a multi-tiered platform designed to grow Ethereum through a multitude of sidechains, each of which tries to unclog the main platform cost-effectively.

Sidechains are distinct blockchains connected to the main Ethereum blockchain and capable of supporting several Decentralised Finance (DeFi) protocols present on said blockchain. Polygon can be compared to other networks such as Polkadot, Cosmos, and Avalanche.

At the heart of the network is the Polygon software development kit (SDK) used to build Ethereum-compatible decentralised applications as sidechains and link them to the network’s main blockchain.

Polygon’s main chain is a Proof of Stake (PoS) sidechain in which network members stake MATIC tokens on their platform to verify transactions and vote on network enhancements.

Special Features of Polygon

What distinguishes Polygon from its layer 2 competitors? Polygon is the only network that permits MATIC tokens to be staked on its blockchain. Staking enables its users to earn yearly interest for helping authenticate blockchain transactions.

Polygon offers solutions for individuals, developers, and businesses. The major purpose of Polygon is to develop an Internet of Things (IoT) on the Ethereum blockchain. Without losing decentralisation or security, the project seeks to grow Ethereum and ensure it has scalability.

Polygon’s methodology distinguishes it from other Layer 2 options. Polygon delivers a suite of solutions on a single network to developers. This provides them with more flexibility and customisation when selecting the optimal scaling option for their application.

In May 2021, the Polygon network announced the release of the Polygon Software Development Kit, which simplifies the process of creating a multichain network for developers. Using the Polygon SDK, developers can build decentralised networks solely responsible for their own security. These independent sidechains will be connected to Ethereum through a specialised PoS bridge network.

Polygon features other scalability strategies, such as its PoS commit chain, which is referred to as Polygon. The Polygon PoS sidechain has been the most popular product of the project. The Polygon blockchain is estimated to have completed about one billion transactions and counting.

The PoS commit chain is EVM (Ethereum Virtual Machine) compatible and fully interoperable with most Ethereum protocols. Consequently, it is straightforward for developers to port DApps between platforms.

Polygon, in contrast to other EVM sidechains, adds checkpoints to the Ethereum network. Specifically, each time Polygon executes a transaction, it adds a few Ethereum checkpoints. These checkpoints guarantee that all data handled on Polygon up to that moment is legitimate and secure for the Ethereum blockchain.

MATIC Token and Wallet

The Matic token (MATIC) is Polygon’s native token. MATIC tokens power the protocol via a gas-based mechanism used to pay network fees generated from the network’s computing power to move data. This enables developers and ecosystem participants to create decentralised applications (dApps) on Polygon by paying MATIC tokens to access the platform and its development framework.

In addition, MATIC functions as a governance token by allowing its holders to vote on which of the several proposed scaling solutions to be implemented. If the community loves a new layer-2 scaling solution and wants Polygon to include it, token holders can vote on whether the solution will be added to the company’s product range. Consequently, governance voting enables MATIC token holders to decide on Polygon’s destiny.

MATIC tokens can be kept in the Matic Wallet, the Matic Wallet utilises Polygon’s MoreVP technology to provide MATIC token holders with a simple way to manage their crypto assets. The wallet is designed to be fast and integrates with WalletConnect to safeguard a user’s private keys and enable access to other Polygon features. The wallet allows users to connect to other dApps, stake their MATIC tokens, and store other ERC-20 tokens.

You can buy, sell, and trade MATIC right here on CoinSpot.

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