Michaël van de Poppe - 19 July 2022
Polygon: The Swiss Army Knife of L2’s
There’s a decent chance you have already heard of Polygon. Polygon is a layer 2 scaling solution for Ethereum. It helps offload transactions to a faster and cheaper network than Ethereum. $MATIC, which is Polygon’s native token, has seen an increase of 12000% to-date since its mainnet launch in March 2020, and continues to show relevance and strength despite the overall market downturn. With the big announcement coming up in 2 days we thought it would be a good time to go over Polygon’s current state and their future plans.
Polygon PoS is a Proof of Stake scaling solution for the Ethereum blockchain. It enables faster and cheaper transactions compared to Ethereum.
Polygon was able to gain the first-movers advantage by spinning up a sidechain of Ethereum which now is called Polygon PoS. While it was not the most decentralized or correct way of doing things, it certainly was the fastest. This first-mover advantage enabled Polygon to gain a decent chunk of market share and grow a strong warchest, because there were no true contenders around.
The Polygon team has been expanding heavily over the past year and has announced multiple new products. Through strategic focus on ZK technology they have diversified themselves by having exposure to every single type of layer 2 that is being developed at the moment (except optimistic rollups).
“We consider ZK cryptography the single most important strategic resource for blockchain scaling and infrastructure development, and we have a clear goal of becoming the leading force and contributor in this field for years to come.” Polygon co-founder Mihailo Bjelic.
MATIC is the token native to the Polygon network. It serves multiple purposes:
It is a unit of payment on the network
It is the token required to participate in Polygon’s consensus protocol (Staking)
It is used as a means of settlement between users of the network
It is used to reward people who contribute to the network
The token was available for $0.00263 per MATIC token during the ICO in April 2019. Currently it trades at $0.91, which is a 175% increase MoM and 65% off its ATH of $2.87.
Polygon is well positioned as the go-to carbon-neutral blockchain scaling solution and has managed to land some impressive partnerships as a result. Let’s go over the three most recent and biggest ones.
Firstly, Reddit has announced the launch of their NFT avatar marketplace which will be built on Polygon. Initially there will be 90 designs that will be launched, which will be limited editions with the option to use them outside of Reddit as profile pictures. Notably the NFT’s will not be available to the general public but only to members of the Collectible Avatars subreddit.
Secondly, Polygon has partnered with Nothing, which is a brand new London based smartphone and tech developer.
Initially, the partnership will be an NFT membership club, with Polygon NFTs provided to people who helped crowdfund Nothing’s launch, as well as those who pre-ordered the Nothing Phone.
Ultimately the plan is to infuse the Android based smartphone with easy access to apps and games on Polygon’s platform, as well as payments and even features such as Polygon ID, which is a zero-knowledge proof based identity solution.
Finally, the Walt Disney Company has announced that Polygon is one of the six companies that will be joining the 2022 Disney Accelerator. The accelerator is a yearly business development program designed to accelerate the growth of innovative companies from around the world.
This year’s accelerator is focused on the future of immersive experiences and technologies such as augmented reality, non-fungible tokens and artificial intelligence.
Interestingly Polygon is the only blockchain that has been selected for the program. Disney did not directly specify why it picked Polygon but they did highlight its Web3 attributes.
It will be interesting to see what will come out of this accelerator.
These are some of the reasons why the long-term outlook of Polygon remains positive as it has been continuing to grow its adoption by mainstream entities. We expect Polygon to continue its conquest to become THE number 1 scaling solution for Ethereum and continue to partner up with more high profile companies much alike Disney and Reddit. With Polygon’s colossal warchest and aggressive expansion strategy, they are expected to perform well as an all-round scaling platform and ecosystem with a focus on Ethereum.