What Is Polygon? All You Need to Know About MATIC
What Is Polygon (MATIC)?
Cryptocurrency is on the rise with more people entering this digital space daily. There are many different platforms in cryptocurrency with bitcoin, Ethereum, and dogecoin being the most notable. Polygon is a network that is used in the Ethereum Blockchain.
Polygon is a layer-2 scaling solution that was created to transcend some of the common limitations associated with Ethereum Blockchain. Upon its release in 2017, it was initially known as Matic, a name many still associate it with to date. It was intended as a scaling solution but has evolved to be one of the most popular multipurpose ecosystems. To further understand Polygon, we may need to understand what a layer-2 scaling solution is.
A layer-2 Solution is a Blockchain on its own but runs alongside another mainnet to improve transactions. In the case of Polygon, the mainnet in question is Ethereum. Layer-2 solutions are essentially secure bridges that enable communications between two blockchains. While not the mainnet, a layer-2 solution is usually faster than the mainnet and requires less transaction (gas) fees.
With dApps in high demand, mainnets tend to be overcrowded, thus resulting in low throughputs. Ethereum has become particularly crowded thanks to security and innovation. One side effect of this traffic is slow transactions and exuberant transaction fees. In some cases, it can be as many as three digits in dollars. This makes trading in Ethereum somewhat limiting, especially to newcomers. Polygon, a Layer-2 solution, makes dealing on the Ethereum Blockchain both quicker and cheaper. Those who can put up with the fees can proceed, while others have an alternative in Polygon.
How Does Polygon Work? PoS Structure and Checkpoint Mechanism
On an entry-level, polygon simply gives you access to the Ethereum Blockchain. Polygon also benefits from the protocols, security, and innovativeness of Ethereum. Since its inception, Polygon has evolved into a platform capable of creating and launching interoperable Blockchains.
The Ethereum Blockchain is already impressive, but Polygon helps take it to a new level. By improving on the already impressive features in the marketplace, trading becomes more impressive.
Polygon network is a blockchain application platform that provides hybrid Proof-of-Stake and Plasma-enabled sidechains. A group of incentive-driven validators running Heimdall and Bor nodes are deployed on Ethereum (Polygon’s basechain) together with a set of staking management contracts to enable the PoS mechanism on the platform.
That said, we can already glimpse the three basic parts of Polygon’s structure:
- Staking smart contracts on Ethereum;
- Two types of validators, respectively called Heimdall and Bor.
Polygon smart contracts
The Polygon chain was created to work closely with that of Ethereum, i.e. to take advantage of its best features and functions, without affecting the scalability of the latter. For this reason, Polygon maintains a set of smart contracts on Ethereum, which handle the following:
- Staking management for the Proof-of-Stake layer;
- Delegation management including validator shares;
- Checkpoints/snapshots of sidechain state.
Heimdall
Also called ‘Proof-of-Stake validator layer’, Heimdall is a vital component of the Polygon protocol. It is responsible for maintaining the security and integrity of the network by validating and relaying transactions, maintaining the state of the sidechains, and ensuring that the network is operating in accordance with the protocol’s rules. Heimdall is basically the validator node that complies with Ethereum’s staking contracts in order to make Polygon’s PoS system functional, by acting as a sort of synchronizer. Heimdall validators play a crucial role in maintaining the network’s security and decentralization. They are also responsible for proposing and voting on upgrades to the protocol, so they get rewarded with transaction fees for their work.
Bor
Also called ‘Block Producer Layer’, Bor is responsible for creating new blocks in the sidechains and adding them to the blockchain, after aggregating transactions. Validators, who run the Heimdall service, are responsible for verifying transactions, relaying them to the basechain (Ethereum), and including them in new blocks, and this process is done by the Bor nodes. Anyone can participate as a Bor node and help secure the network, by becoming a validator, as long as they meet the required stake and reputation conditions.
Checkpoint Mechanism
The checkpoint system operated in conjunction with the basechain is vital, because it helps to prevent malicious actors from creating fake sub-chains on the Polygon network. It works by periodically recording the state of the sidechain on the main Ethereum blockchain, creating a “checkpoint” that can be used to verify the authenticity. To be more specific, when a checkpoint is established, a smart contract on the primary Ethereum blockchain is utilized to record the current block number and the Merkle tree’s root hash for the state of the sidechain. This information can then be used to verify that the sidechain is in a valid state and that it is being operated honestly. The creation of checkpoints occurs frequently, perhaps once each hour or day. The sidechain’s validators will vote on the proposed checkpoint when a checkpoint is made, and if it is approved, it will be added to the main Ethereum blockchain.
What Is the MATIC Token?
MATIC is the native token of the Polygon network, and it is used to pay for transaction fees and to participate in the network’s consensus mechanism. It has a maximum supply of 10 billion, of which just over 75% is already in circulation.
Transaction fees on the Polygon network are paid in MATIC, and they are used to cover the costs of running and maintaining the network. When a user sends a transaction on a Polygon chain, they must include enough MATIC to cover the cost of that transaction. The fees are then paid to the validators who are responsible for processing the transaction and maintaining the integrity of the chain.
MATIC is also used for the network’s consensus mechanism, which is based on a modified version of the Proof of Stake (PoS) algorithm. In this consensus mechanism, holders of MATIC can stake their tokens and become validators on the network. These validators are responsible for verifying transactions and creating new blocks. In return for this work, they receive a portion of the transaction fees collected by the network. As the use of the Polygon network increases, the demand for MATIC is also expected to increase, and as demand increases, so does the value of the token.
Pros Of Using Polygon
Polygon has several advantages to offer, making it valuable for anyone who wishes to enter the world of Ethereum. Some of the pros associated with Polygon include:
Transactions are faster
There is nothing more frustrating in the cryptocurrency market. With the volatility of the market, every second counts. Due to overcrowding in the mainnet, transactions can sometimes take longer, which can cause losses. Polygon on the other hand operates faster, seeing as transactions occur outside the mainnet. Fast transactions on Polygon are possible thanks to the consensus mechanism which makes confirmations easier. On average, completing a transaction on Polygon takes just over 2 seconds.
It Minimizes Costs
One of the biggest limitations of trading on the mainnet is the risk of transaction fees running high. Transaction fees are typically dependent on the transaction amount, but can still prove to be too much. On Polygon, you will not have to worry about high transaction fees, with transaction fees usually less than $1. On average, the transaction fee is around $0.01, making polygon ideal for small transactions. As a newcomer to the Ethereum Blockchain, Polygon will prove to be more favorable.
It has a Unique Token
Polygon has its unique crypto-token, Matic, which is the central currency used here. You will still be transacting in the Ethereum marketplace, but not in Ethereum. A rise in the value of Matic will also mean a rise in the value of your holdings.
What Can You Do With Polygon?
Polygon can do anything you can do on the Ethereum mainnet. Thanks to its continuous rise in popularity, different marketplaces already recognize Polygon. While you will still be trading in the Ethereum mainnet, all your transactions will be processed through Polygon. You should however note that you may still have a few limitations. Some Ethereum protocols do not yet have counterparts on Polygon. With Polygon constantly evolving, however, the protocols are sure to expand.
First Of Its Kind
With so many Blockchain platforms available, it is easy to get drawn to popular names. Polygon is a unique platform in many ways, making it ideal especially for newcomers. One of the most impressive features of Polygon is its optional security protocol. While it has an impressive security protocol, Ethereum’s security protocol is still in use. Ethereum retains its self-sovereignty, but can still use Polygon’s security protocols. Seeing as Polygon improves on Ethereum’s protocols, it makes the security all the more impressive.
Is MATIC a Good Investment?
Polygon may still be a majorly unknown platform, but it is surely on the rise. Thanks to the rise of Matic and its newfound attention, the future is bright for Polygon. Matic also happens to be one of the most stable coins, even surviving market crashes. When coupled with all its impressive features, Polygon is an excellent platform.
How to Own MATIC?
You can own MATIC via a centralized crypto exchange, so you can begin by creating a Gate.io account. Once the account is verified and funded, find out the steps to buy MATIC. In a nutshell, you can do this via flash swap, trading the spot market or even using leverage.
News on Polygon
As announced in the Polygon blog in November 2022, Instagram users will soon be able to utilize the platform to create, display, and sell digital collections powered by non-fungible tokens (NFTs) on Polygon. This will provide creators with a new channel for connecting with and making money from their fan bases. Instagram’s parent company, Meta, revealed that it will begin testing these new capabilities with a select set of American creators before rolling them out to more users and nations.
In the meantime, the world’s largest bank, JPMorgan, utilized Polygon to execute its first live deal on a public blockchain, valued roughly $71,000, which was a significant step toward integrating cryptocurrencies into established financial systems.
It is now visible how Polygon’s list of high-profile partners is getting longer, with big players starting to explore Web 3.0 and its integrations with blockchain technology.
Useful References
For the latest updates about Polygon, you can visit:
Take Action on MATIC
Check out the MATIC price today and start trading your favourite currency pairs.
Related articles
What Are Altcoins?
What Is Ethereum 2.0? Understanding The Merge
What Is Dogecoin?
What Is Polygon? All You Need to Know About MATIC
What Is Polygon (MATIC)?
How Does Polygon Work? PoS Structure and Checkpoint Mechanism
What Is the MATIC Token?
Pros Of Using Polygon
What Can You Do With Polygon?
Is MATIC a Good Investment?
How to Own MATIC?
News on Polygon
Useful References
Take Action on MATIC
What Is Polygon (MATIC)?
Cryptocurrency is on the rise with more people entering this digital space daily. There are many different platforms in cryptocurrency with bitcoin, Ethereum, and dogecoin being the most notable. Polygon is a network that is used in the Ethereum Blockchain.
Polygon is a layer-2 scaling solution that was created to transcend some of the common limitations associated with Ethereum Blockchain. Upon its release in 2017, it was initially known as Matic, a name many still associate it with to date. It was intended as a scaling solution but has evolved to be one of the most popular multipurpose ecosystems. To further understand Polygon, we may need to understand what a layer-2 scaling solution is.
A layer-2 Solution is a Blockchain on its own but runs alongside another mainnet to improve transactions. In the case of Polygon, the mainnet in question is Ethereum. Layer-2 solutions are essentially secure bridges that enable communications between two blockchains. While not the mainnet, a layer-2 solution is usually faster than the mainnet and requires less transaction (gas) fees.
With dApps in high demand, mainnets tend to be overcrowded, thus resulting in low throughputs. Ethereum has become particularly crowded thanks to security and innovation. One side effect of this traffic is slow transactions and exuberant transaction fees. In some cases, it can be as many as three digits in dollars. This makes trading in Ethereum somewhat limiting, especially to newcomers. Polygon, a Layer-2 solution, makes dealing on the Ethereum Blockchain both quicker and cheaper. Those who can put up with the fees can proceed, while others have an alternative in Polygon.
How Does Polygon Work? PoS Structure and Checkpoint Mechanism
On an entry-level, polygon simply gives you access to the Ethereum Blockchain. Polygon also benefits from the protocols, security, and innovativeness of Ethereum. Since its inception, Polygon has evolved into a platform capable of creating and launching interoperable Blockchains.
The Ethereum Blockchain is already impressive, but Polygon helps take it to a new level. By improving on the already impressive features in the marketplace, trading becomes more impressive.
Polygon network is a blockchain application platform that provides hybrid Proof-of-Stake and Plasma-enabled sidechains. A group of incentive-driven validators running Heimdall and Bor nodes are deployed on Ethereum (Polygon’s basechain) together with a set of staking management contracts to enable the PoS mechanism on the platform.
That said, we can already glimpse the three basic parts of Polygon’s structure:
- Staking smart contracts on Ethereum;
- Two types of validators, respectively called Heimdall and Bor.
Polygon smart contracts
The Polygon chain was created to work closely with that of Ethereum, i.e. to take advantage of its best features and functions, without affecting the scalability of the latter. For this reason, Polygon maintains a set of smart contracts on Ethereum, which handle the following:
- Staking management for the Proof-of-Stake layer;
- Delegation management including validator shares;
- Checkpoints/snapshots of sidechain state.
Heimdall
Also called ‘Proof-of-Stake validator layer’, Heimdall is a vital component of the Polygon protocol. It is responsible for maintaining the security and integrity of the network by validating and relaying transactions, maintaining the state of the sidechains, and ensuring that the network is operating in accordance with the protocol’s rules. Heimdall is basically the validator node that complies with Ethereum’s staking contracts in order to make Polygon’s PoS system functional, by acting as a sort of synchronizer. Heimdall validators play a crucial role in maintaining the network’s security and decentralization. They are also responsible for proposing and voting on upgrades to the protocol, so they get rewarded with transaction fees for their work.
Bor
Also called ‘Block Producer Layer’, Bor is responsible for creating new blocks in the sidechains and adding them to the blockchain, after aggregating transactions. Validators, who run the Heimdall service, are responsible for verifying transactions, relaying them to the basechain (Ethereum), and including them in new blocks, and this process is done by the Bor nodes. Anyone can participate as a Bor node and help secure the network, by becoming a validator, as long as they meet the required stake and reputation conditions.
Checkpoint Mechanism
The checkpoint system operated in conjunction with the basechain is vital, because it helps to prevent malicious actors from creating fake sub-chains on the Polygon network. It works by periodically recording the state of the sidechain on the main Ethereum blockchain, creating a “checkpoint” that can be used to verify the authenticity. To be more specific, when a checkpoint is established, a smart contract on the primary Ethereum blockchain is utilized to record the current block number and the Merkle tree’s root hash for the state of the sidechain. This information can then be used to verify that the sidechain is in a valid state and that it is being operated honestly. The creation of checkpoints occurs frequently, perhaps once each hour or day. The sidechain’s validators will vote on the proposed checkpoint when a checkpoint is made, and if it is approved, it will be added to the main Ethereum blockchain.
What Is the MATIC Token?
MATIC is the native token of the Polygon network, and it is used to pay for transaction fees and to participate in the network’s consensus mechanism. It has a maximum supply of 10 billion, of which just over 75% is already in circulation.
Transaction fees on the Polygon network are paid in MATIC, and they are used to cover the costs of running and maintaining the network. When a user sends a transaction on a Polygon chain, they must include enough MATIC to cover the cost of that transaction. The fees are then paid to the validators who are responsible for processing the transaction and maintaining the integrity of the chain.
MATIC is also used for the network’s consensus mechanism, which is based on a modified version of the Proof of Stake (PoS) algorithm. In this consensus mechanism, holders of MATIC can stake their tokens and become validators on the network. These validators are responsible for verifying transactions and creating new blocks. In return for this work, they receive a portion of the transaction fees collected by the network. As the use of the Polygon network increases, the demand for MATIC is also expected to increase, and as demand increases, so does the value of the token.
Pros Of Using Polygon
Polygon has several advantages to offer, making it valuable for anyone who wishes to enter the world of Ethereum. Some of the pros associated with Polygon include:
Transactions are faster
There is nothing more frustrating in the cryptocurrency market. With the volatility of the market, every second counts. Due to overcrowding in the mainnet, transactions can sometimes take longer, which can cause losses. Polygon on the other hand operates faster, seeing as transactions occur outside the mainnet. Fast transactions on Polygon are possible thanks to the consensus mechanism which makes confirmations easier. On average, completing a transaction on Polygon takes just over 2 seconds.
It Minimizes Costs
One of the biggest limitations of trading on the mainnet is the risk of transaction fees running high. Transaction fees are typically dependent on the transaction amount, but can still prove to be too much. On Polygon, you will not have to worry about high transaction fees, with transaction fees usually less than $1. On average, the transaction fee is around $0.01, making polygon ideal for small transactions. As a newcomer to the Ethereum Blockchain, Polygon will prove to be more favorable.
It has a Unique Token
Polygon has its unique crypto-token, Matic, which is the central currency used here. You will still be transacting in the Ethereum marketplace, but not in Ethereum. A rise in the value of Matic will also mean a rise in the value of your holdings.
What Can You Do With Polygon?
Polygon can do anything you can do on the Ethereum mainnet. Thanks to its continuous rise in popularity, different marketplaces already recognize Polygon. While you will still be trading in the Ethereum mainnet, all your transactions will be processed through Polygon. You should however note that you may still have a few limitations. Some Ethereum protocols do not yet have counterparts on Polygon. With Polygon constantly evolving, however, the protocols are sure to expand.
First Of Its Kind
With so many Blockchain platforms available, it is easy to get drawn to popular names. Polygon is a unique platform in many ways, making it ideal especially for newcomers. One of the most impressive features of Polygon is its optional security protocol. While it has an impressive security protocol, Ethereum’s security protocol is still in use. Ethereum retains its self-sovereignty, but can still use Polygon’s security protocols. Seeing as Polygon improves on Ethereum’s protocols, it makes the security all the more impressive.
Is MATIC a Good Investment?
Polygon may still be a majorly unknown platform, but it is surely on the rise. Thanks to the rise of Matic and its newfound attention, the future is bright for Polygon. Matic also happens to be one of the most stable coins, even surviving market crashes. When coupled with all its impressive features, Polygon is an excellent platform.
How to Own MATIC?
You can own MATIC via a centralized crypto exchange, so you can begin by creating a Gate.io account. Once the account is verified and funded, find out the steps to buy MATIC. In a nutshell, you can do this via flash swap, trading the spot market or even using leverage.
News on Polygon
As announced in the Polygon blog in November 2022, Instagram users will soon be able to utilize the platform to create, display, and sell digital collections powered by non-fungible tokens (NFTs) on Polygon. This will provide creators with a new channel for connecting with and making money from their fan bases. Instagram’s parent company, Meta, revealed that it will begin testing these new capabilities with a select set of American creators before rolling them out to more users and nations.
In the meantime, the world’s largest bank, JPMorgan, utilized Polygon to execute its first live deal on a public blockchain, valued roughly $71,000, which was a significant step toward integrating cryptocurrencies into established financial systems.
It is now visible how Polygon’s list of high-profile partners is getting longer, with big players starting to explore Web 3.0 and its integrations with blockchain technology.
Useful References
For the latest updates about Polygon, you can visit:
Take Action on MATIC
Check out the MATIC price today and start trading your favourite currency pairs.
Related articles
What Are Altcoins?
What Is Ethereum 2.0? Understanding The Merge