Deep Dive 3 - Polygon
Once a week I will find a coin with a real purpose, do some research on it, and write up a Lean Letter for you to view. I will not be schilling coins without a purpose. Only real coins that I see fit into this innovative, ever-changing space.
I was planning on talking about this one anyway, but the social sentiment is very high. Polygon, previously known as Matic Network, received some news- pushing it to all-time highs.
What is Polygon?
Polygon, with the ticker MATIC, is a platform created to help solve some of the issues on Ethereum. Ethereum is well-known for its bad interface, high gas fees, and lots of failed transactions. This is where MATIC comes to help. MATIC’s end goal is to create an “Internet of blockchains'“ which is an easier way to describe a multi-chain ecosystem of Ethereum-compatible blockchains.
MATIC was originally introduced to be a layer 2 scaling solution for the Ethereum network but turned into the infrastructure for a massively scaling blockchain system.
MATIC is being developed by a team led by the four co-founders; Jaynti Kanani, Sandeep Nailwal, Anurag Arjun, and Mihailo Bjelic.
How can you obtain Polygon?
MATIC uses the token for governance, staking, and gas fees via a Proof of Stake mechanism. This means you cannot mine MATIC. You will have to buy the token from Coinbase, or any others, and then stake your coin somewhere for rewards.
During the private sale in 2017, 3.8% of the maximum supply was issued. In April 2019, 19% was sold at 0.00263 per token at the launchpad sale. The remaining tokens are distributed in the following manner:
Team tokens: 16% of the max supply.
Advisor’s tokens: 4% of the max supply.
Network operations tokens: 12% of the max supply.
Foundation tokens: 21.86% of the max supply.
Ecosystem tokens: 23.33% of the max supply.
According to the official release schedule, all tokens will be released by December 2022.
What is Polygon’s role?
Like we mentioned before, MATIC is a layer 2 scaling solution for Ethereum. MATIC uses a Proof of Stake system of validators for asset security. It is unique in the market because it is the only scaling solution that will run on the Ethereum Virtual Machine.
Scaling solutions on the Ethereum network tend to work by boosting the number of transactions that can fit into each block. This is one of Ethereums biggest flaws- its transaction throughput. This means, how many transactions the network can process simultaneously. This is done by bundling a bunch of transfers into a single optimized transaction or by handling some of the transaction logic off the Ethereum mainchain.
MATIC is up 15,065% YTD.
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