Summary

So far, it is reasonable to assume that the future trend is multi-chain. It is likely that the future will not be dominated by a single blockchain, but rather a large number of interconnected networks, each with unique properties, trust assumptions, performance, and security.

Polygon is working to make the future a reality by providing a framework to create scaling solutions compatible with Ethereum. Its proof-of-stake sidechain has attracted attention from the Bitcoin and cryptocurrency community. Let’s take a closer look.

Introduction

The long-awaited Ethereum scaling roadmap is finally coming to fruition, and the Polygon project has made an indelible contribution to this.

You may have heard of Cosmos and its vision of an “Internet of Blockchains” where information can be transferred between different blockchains implementing the Inter-Blockchain Communication protocol (IBC).

Polygon’s vision is similar, but it has chosen to tailor the concept specifically for the Ethereum ecosystem, hoping that developers can easily launch scaling solutions that are compatible with Ethereum, or even independent blockchains.

The project initially started out as the “MATIC Network” and was eventually renamed “Polygon” as the scope of the project expanded from a single Layer 2 (L2) solution to a “network of networks”.

What is Polygon (MATIC)?

Polygon is a framework for creating Ethereum-compatible blockchain networks and scaling solutions. It is more of a protocol than a single solution. Therefore, one of the main products in the ecosystem is the Polygon SDK. It helps developers create Ethereum-compatible networks.

The Polygon network, which you may have heard of, is a proof-of-stake (PoS) sidechain and one of the first products to go live in the Polygon ecosystem. The essence of a sidechain is a parallel chain connected to another blockchain.

Sidechains have many advantages, the most significant of which is increased transaction throughput and low fees. Users who have used the Polygon network must have a deep understanding: compared with Ethereum, its transaction speed is amazing and the cost is extremely low. Even so, there are some trade-offs in some areas to achieve such performance. We will introduce it later.

Polygon supports the Ethereum Virtual Machine (EVM), and existing applications can be migrated to it relatively easily. In addition to obtaining an experience comparable to Ethereum, users can also enjoy the high throughput and low fees mentioned above.

So, what can users do with Polygon? The answer is undoubtedly to get an Ethereum-like experience with lower fees and faster speeds. Polygon has deployed some of the hottest decentralized finance (DeFi) DApps, such as Aave, 1INCH, Curve, and Sushi. Of course, there are also some native applications unique to Polygon, including QuickSwap and Slingshot.

Polygon has grown to where it is today under the leadership of founders Jaynti Kanani, Sandeep Nailwal, Anurag Arjun and Mihailo Bjelic.

How does Polygon work?

The Polygon framework supports two main types of Ethereum-compatible networks: secure chains and independent chains. For example, a rollup is a secure chain, while a sidechain is an independent chain.

Secure chains rely on the chain infrastructure they are attached to, so there is no need to apply a proprietary security model. In contrast, independent chains must ensure their own security. Therefore, secure chains usually have a higher level of security, while independent chains can provide greater flexibility based on specific needs.

What's going on with the Polygon network? The Polygon sidechain is secured by a dedicated set of validators (validator pool), which must submit checkpoints to Ethereum from time to time. Therefore, some argue that sidechains are not a "pure" Layer 2 solution. They must be responsible for their own security and will not rely on Ethereum's security. This is probably its most significant difference, and we’ll get into more detail later when we discuss “aggregation”.

In the future, the Polygon platform hopes to support a wider range of expansion solutions, including: zero-knowledge rollup (ZK Rollup), optimistic rollup (Optimistic Rollup) and Validum chain. As expansion solutions come out, developers will have more tools to continue to develop innovative applications, solutions and products. In addition, we expect all solutions to be compatible with existing Ethereum tools and wallets (such as MetaMask).

Use Cases of MATIC Token

Although the MATIC network has been renamed, the name of the MATIC token is still used today. Through the MATIC token, users can pay for gas fees in the network and participate in governance. To stake MATIC tokens, you can do so through Binance Finance or the MATIC network wallet developed by the Polygon team.

Polygon Bridge

The Polygon Bridge is the most convenient way to transfer funds from other blockchain networks to the Polygon sidechain. Please note that bridge transactions are conducted on the mainnet, so the mainnet transaction fees still need to be paid.

However, as long as the bridge transaction is completed, you can enjoy the low fees and fast transactions brought by Polygon. In addition, some centralized trading platforms (CEX) also provide direct withdrawal services to the Polygon network.

Sidechains vs Rollups

Overall, it is still unclear whether sidechains can be classified as Layer 2 solutions like rollups. If you want to navigate the multi-chain world and balance the various pros and cons, you must understand the difference between the two.

The two have different trust assumptions, security, performance, and user and developer experience. As a secure chain, Rollup inherits most of Ethereum's security and is the most promising Layer 2 expansion solution.

However, this is not the case with other solutions such as Polygon sidechains. This is not to say that sidechains are unsafe, but it is still possible (at least in theory) to control the entire network if bad actors collude. We certainly don't want this to happen, but it is indeed something we should prevent. Using sidechains will raise trust issues, in addition to the network validators, there is also the bridge between the two chains involved.

Other pros and cons are worth weighing. When using the Ethereum mainnet, although transaction fees are high and transaction speeds are slow, it is the most secure and there is almost no need to worry about trust between the parties.

If you use rollups, you pay less fees, have relatively high security, and have shorter transaction times. If you use sidechains, you pay a fraction of the fees of rollups, but you don’t get the same security.

Which solution is better? There is no simple answer to this question. Each solution has its own specific use cases, and they complement each other to form a valuable ecosystem.

For example, a social media reputation system needs to achieve extremely high transaction throughput at ultra-low fees, but it is not an important infrastructure and therefore does not require the highest level of security. In this case, it is worth sacrificing a certain level of security to achieve performance.

On the other hand, if a country’s treasury funds are stored on a blockchain, the highest level of security should be provided at all costs, regardless of lightning-fast transaction speeds.

Developers and project teams are constantly experimenting and investigating how all of the building blocks fit into the big picture. Scalability is definitely a focus, as scaling solutions are needed for many different use cases across a wide range of industries.

Summarize

Polygon is a framework for creating blockchain expansion solutions compatible with Ethereum. The Polygon Network is a proof-of-stake (PoS) sidechain that has attracted a considerable number of users in the market due to its fast transactions, low costs, and compatibility with the Ethereum Virtual Machine (EVM).

Polygon hopes to provide more expansion solutions in the future, including zero-knowledge rollups (ZK Rollup), optimistic rollups (Optimistic Rollup), and independent blockchains, which will help create a more vibrant Layer 2 interconnected ecosystem for Ethereum.