What is Polygon?
The Polygon Blockchain: Revolutionizing Decentralized Finance
Blockchain technology has been around for over a decade, but it's only in recent years that it has gained mainstream attention. Polygon, a Layer-2 scaling solution built on the Ethereum network, is among the most promising and innovative blockchain projects. In this blog post, we'll explore what Polygon is, how it works, and why its founders believe it's a game-changer in the world of decentralized finance (DeFi).
Polygon is a Layer-2 scaling solution that addresses the scalability issues of the Ethereum network. Founded in 2017 by Jaynti Kanani, Sandeep Nailwal, and Anurag Arjun, the project was initially named Matic Network and rebranded to Polygon in February 2021.
The founders of Polygon are experienced developers and entrepreneurs in the blockchain space. Jaynti Kanani previously worked at Housing.com, a real estate platform, and has also founded other blockchain projects. Sandeep Nailwal is the co-founder of Polygon and also the founder of Matic Network, which was acquired by Polygon in 2020. Anurag Arjun is a blockchain developer with experience in smart contract development and decentralized applications.
Polygon provides a framework for building and connecting Ethereum-compatible blockchain networks. It is an open-source platform that offers faster and cheaper transactions, making it ideal for DeFi applications. Polygon's architecture is designed to support multiple interconnected chains, allowing developers to create customized blockchains that suit their needs.
How Polygon Works
Polygon uses a unique Layer-2 scaling solution called Plasma to increase the scalability of the Ethereum network. Plasma is a framework for creating sidechains that are connected to the Ethereum mainnet. These sidechains are designed to process transactions faster and more efficiently than the mainnet.
When a user makes a transaction on the Polygon network, it is first processed on the sidechain. Once the transaction is verified, it is committed to the mainnet. This process, known as checkpointing, allows Polygon to achieve higher throughput and lower transaction fees.
Polygon also uses a modified version of Ethereum's Proof of Stake (PoS) consensus algorithm called Proof of Stake-Checkpointing (PoS-C). PoS-C is a hybrid consensus mechanism that combines the security of PoS with the scalability of Plasma. It allows Polygon to process thousands of transactions per second while maintaining high security.
Why is Polygon Important For DeFi?
DeFi has exploded in popularity over the past year, with the total value locked (TVL) in DeFi protocols reaching a record high of $157 billion in May 2021. However, the high transaction fees and slow transaction times on the Ethereum network have become a major obstacle to DeFi's growth.
Polygon's Layer-2 scaling solution addresses these issues by providing faster and cheaper transactions. It allows DeFi protocols to operate more efficiently, making them more accessible to a wider audience. With Polygon, users can interact with DeFi protocols without having to pay exorbitant gas fees.
Polygon has already attracted many DeFi projects to its network, including Aave, SushiSwap, Curve Finance, and QuickSwap. These projects have migrated to Polygon to take advantage of its scalability and lower transaction fees. As more DeFi projects join the network, Polygon is likely to become a dominant player in the DeFi space.
Polygon is a game-changer for the blockchain industry, especially for the DeFi space. Its founders, experienced developers, and entrepreneurs created a Layer-2 scaling solution that addresses the scalability issues of the Ethereum network. The platform's architecture supports multiple interconnected chains, making it ideal for developers looking to create customized blockchains.
As more DeFi projects migrate to the Polygon network, we expect to see increased platform adoption. Polygon can potentially attract a wider audience beyond DeFi, as the network's scalability benefits could also be applied to other industries. This could include gaming, supply chain management, and even social media platforms that require high transaction throughput.
Polygon's success has also led to increased interest from investors. In May 2021, the project raised $15 million in a funding round led by billionaire investor Mark Cuban. This funding will further develop the Polygon ecosystem and attract more developers to build on the platform.
As Polygon grows and attracts more users, it will likely face competition from other blockchain projects. However, with its unique Layer-2 scaling solution and experienced team of founders, the platform is well-positioned to maintain its dominance in the DeFi space and beyond.