Polygon (MATIC): Could It WIN The ETH Scaling Race??
👨🏫Matic Network Recap👨🏫
Matic Network uses More Viable Plasma. MVP involves creating copies of the Ethereum blockchain called child chains which periodically submit 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.
💱Matic Polygon Rebrand💱
In February 2021, Matic Network rebranded to Polygon. This marked the project’s shift in focus from providing a single scaling solution to becoming ‘Ethereum’s Internet of Blockchains’. The Matic Network is still alive and well – it has 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 has an architecture of its own that is divided into four layers. The first is the Ethereum layer, which all of Polygon’s layer 2 blockchains will rely on for security and consensus. The second layer is the security layer which will handle Polygon’s security as a service product. 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.
Polygon has partnered with dozens of cryptocurrency projects including The Graph, Chainlink, Atari, and Aavegotchi. The Matic token was also recently listed on Coinbase.
In February, Polygon logged over 200 thousand 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 dApp on Polygon by TVL is currently Quickswap, a Uniswap clone which currently holds over 100 million dollars in crypto.
🤑Matic Price Potential🤑
The interesting thing about the Matic token is that even though it is used for staking, it has a fixed supply of 10 billion. A substantial portion of this supply has been set aside for staking. The issue is that many of the tokens which have yet to be issued are being unlocked every 6 months, which could suppress price action in the short term. However, given Matic’s low market cap and the utility of the token combined with the uptick in usage, it is very likely that Matic could still increase by another 10x before the bull market is over.
👀Optimism vs. Polygon👀
Optimism has been in the works for well over a year and unlike other layer 2 scaling solutions, it does not have a token and was essentially with the express purpose of scaling Ethereum. Ethereum projects like Uniswap and Synthetix are already preparing to launch on Optimism, and Coinbase will support deposits and withdrawals directly from Ethereum’s Optimism layer. Once Optimism goes live, this could put a dent in Polygon and other layer 2s.
📜 Disclaimer 📜
The information contained herein is for informational purposes only. Nothing herein shall be construed to be financial legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading cryptocurrencies poses considerable risk of loss. The speaker does not guarantee any particular outcome.