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Polygon is a popular scaling solution for Ethereum. It provides a cheaper and faster alternative to Ethereum while still using the Ethereum main chain. Using optimistic and ZK rollups, Polygon is attempting to provide massive scalability to Ethereum, explaining why Polygon’s token MATIC is currently in the top 20 by market cap.
Polygon brought a number of decentralized applications(DApps) to its networks. Those looking to build on a blockchain without paying astronomical transaction fees are often attracted to Layer 2 solutions. Moreover, any dApp that implements a large number of transactions — GameFi, non-fungible tokens (NFTs), DAOs — are incentivized to migrate to Layer 2s. Polygon facilitates these migrations.
While Polygon is decentralized, it is far more centralized than the Ethereum mainnet – the Layer 2 is backed by Coinbase Global Inc. (NASDAQ: COIN) and Binance. Polygon is also dependent on the success of Ethereum.
Is Polygon Here to Stay or Just a Fad?
Polygon is no fad, and the project has successfully provided a scalability solution to over 19,000 DApps. While there are debtably better chains, Polygon’s first mover advantage has left the chain intertwined deeply into Web3. Unless a large number of superior Layer 2s come out, Polygon should be here to stay.
In October 2017, Polygon was officially launched by Janti Kanani, Sandeep Nailwal and Anurag Arjun. The three founders are a mixture of blockchain developers and business consultants. The blockchain was launched as a proof-of-stake (PoS) side chain to Ethereum.
Originally, Polygon launched as Matic. It was not until a rebranding in 2021 that the name was changed to Polygon. The token remains named MATIC, paying homage to its roots. The project aims to be one of several chains that helps Ethereum scale.
Pros and Cons of Polygon
Polygon provides a number of scalability solutions, but they do not come without key drawbacks.
- Polygon has a block confirmation time of < 2 seconds.
- Polygon can process up to 65,000 transactions per second.
- The standard fee on polygon is < $.01.
- Polygon faces a lot of competition from other scaling solutions.
- Further development of Ethereum could leave Layer 2s obsolete.
- Polygon transactions are more centralized than Ethereum, resulting in higher risk.
New Layer 2 solutions continue to hit the market, with the most recent being Optimism (OP). This project uses optimistic rollups to grant users a credit. This credit is granted immediately and is finalized on the main chain no challenges on the credit are issued within 7 days. This method provides a fast and cheap solution. Optimistic roll ups have shown promise, and the Optimism collective has received praise from Ethereum co-founder Vitalik Buterin.
Many more Layer 2 solutions exist, with a new one seemingly released each week. While some of these projects are just money grabs, there are some viable options on the market – notably Arbitrum and Boba Network.
How to Make Money With Polygon
The simplest way to make money with Polygon is to buy fear. When everyone is selling and markets are red, crypto is on sale. After all, profits are made in bear markets and realized in bull markets. Unless core issues arise with the Layer 2, look to buy cheap.
Another way to earn money is to stake your Polygon (MATIC). By helping to secure the network, you are rewarded yield. This yield varies depending on the amount you are willing to stake.
Finally, projects such as the decentralized social media, Lens Protocol, are built on top of Polygon. By learning the trends of Web3, development skills or otherwise providing value to Web3 projects, you could be at a great advantage. The majority of the companies operating today were started in bear markets; building on Polygon during this bear market may be your best investment.
How to Buy Polygon
To buy Polygon, an account on Crypto.com will suffice – the token is offered on most trading platforms. Another way to purchase the token would be through one of the many decentralized exchanges such as Uniswap. By connecting a non-custodial wallet to Uniswap and purchasing MATIC, you gain many more use options for your tokens, including staking, purchasing NFTs and interacting with the many DApps that Polygon supports.
So, Is Polygon Here to Stay?
Pending Ethereum’s survival, Polygon is likely to be a successful token. While there are a number of other solutions, Polygon has a head start on most by supporting many great DApps. The coin is one to keep your eye on as the crypto market continues to drop in bear territory.
Frequently Asked Questions
Can you make money with Polygon?
Yes, you can make money with Polygon, but you must measure your investments carefully, monitor your portfolio and exit positions safely.
Is Polygon safe?
Polygon is just like any other cryptocurrency. It has inherent risks, but you can protect yourself by using a secure exchange and wallet.
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