What is Polygon (MATIC)?

Polygon is a proof-of-stake blockchain running alongside the main Ethereum blockchain – with its own coin called MATIC.

Created in 2017 as an energy-efficient scaling solution for the Ethereum network, it aims to provide faster transactions at lower fees while enabling developers to build scalable dApps without sacrificing security.

A little bit of background

Polygon launched as The Matic Network in 2017 to tackle one of the biggest issues facing the Ethereum blockchain: scalability.

As dApps, NFTs and the DeFi ecosystem grew in popularity, more transactions were being processed on the Ethereum blockchain. As a result, transaction fees, called gas, got higher while simultaneously making the blockchain slower. Soon enough, there was too much traffic on the Ethereum blockchain – stalling its growth and making it very frustrating to use.

Here’s where the scaling solutions came in. Polygon, much like Avalanche, was born as a sidechain that runs parallel to the Ethereum blockchain and acts as a link for users to access everything on the Ethereum blockchain with much lower transaction fees and at higher speeds. Essentially, if the Ethereum blockchain is a highway then Polygon is the express lane. Both move in the same direction, but one makes the journey more convenient.

What makes Polygon unique?

Polygon uses a slightly different proof-of-stake model to secure the network. Their method allows validators to reach consensus with every new block, unlike traditional proof of stake, which processes many blocks to reach consensus more slowly. This new proof-of-stake method still requires validators to stake their MATIC, in exchange for the right to validate transactions and be rewarded with more MATIC.

How much faster and cheaper is it exactly? Well, currently Ethereum is only able to process roughly 15-30 transactions per second while Polygon can support up to 7,200 transactions per second at a fraction of the cost. Keep in mind, though: Polygon is not trying to compete with Ethereum. Its purpose is to make the Ethereum ecosystem faster and cheaper to encourage greater mass adoption.

Polygon supports more than 7,000 dApps and provides a large technological platform for developers to easily build more. It also offers a framework for blockchain networks that would allow users to create interconnecting blockchains – dubbing itself as Ethereum’s “internet of blockhains.”

What is MATIC?

Originally, Polygon was known as The Matic Network. After it rebranded to Polygon in 2021, the name MATIC was passed on to its native cryptocurrency.

MATIC holders use it for paying transaction fees, for staking to earn more MATIC, and as a governance token for voting on proposed changes to the network. It can also be bought and sold just like any other cryptocurrency.

Like many other cryptocurrencies, the supply of MATIC is limited and the max amount of coins will be capped at 10 billion.