The team behind Polygon (MATIC) bets they can make money by fixing and upgrading the Ethereum blockchain.
To explain, Polygon is a protocol that connects Ethereum-compatible blockchain networks. They claim developers can use Polygon to build and scale multi-chain solutions on the Ethereum ecosystem.
I think Polygon’s goal is to turn Ethereum into a multichain ecosystem. To explain, a multichain ecosystem is an enormous blockchain on which many other blockchains can run. For example, a company could build a proprietary blockchain that operates on Ethereum.
Hence, they call Polygon (MATIC) “Ethereum’s Internet of Blockchain.” The hope is to turn Etheruem into a utility as large, as versatile, and as widely used as the internet.
How Polygon (MATIC) upgrades Ethereum
Additionally, they hope Polygon can increase the speed and capacity of Ethereum. In addition, they hope to create customizable Ethereum solutions that give builders more control over Ethereum.
Some of the purported advantages of Polygon (MATIC) include:
- One click deployment of blockchain networks.
- Growing modules you can use to build custom networks.
- An interoperability protocol that exchanges arbitrary messages between Ethereum and other blockchain networks.
- Modular and optional security as a service provided by Ethereum or other blockchains.
- Adaptor modules that enable interoperability on existing blockchain networks.
- Dedicated throughput resources that are fully customizable.
- A zero-gas user experience comparable to Web2 that enables instant transactions.
- Native support for arbitrary message passing (including fast transmission of tokens) to external systems.
- Native blockchains that are scalable.
- Scalable consensus algorithms.
- Full Ethereum compatibility.
The Polygon Ecosystem and DApps
They claim over 3,000 decentralized apps (DApps) are running on the Polygon Proof of Stake (PoS) ecosystem.
Some of the Polygon PoS DApps include:
Augur, SushiSap, Sportx, Gravity Finance, EasyFi, Aave, Polymarket, Curve finance, QuickSwap, 1inch, BeefyFinance, Ox, Frax Finance, Autofarm, Opium Detwork, Hop Exchange, pods, DODO, Slingshot Finance, WooTrade, Deri Protocol, Polkastarter, Tidal Finance, ForTube, PlotX, the Router Protocol, APWine, Dark Build, OxAPI, CyberFi, Rubic FInance, Trace Network, Nord Finance, Bondly Finance, Stater Finance, Oddz, Polkamarkets, JustBet, Blockpast, DeFi 11, Prosper, the Golem Network, Dark Matter, Mes Finance, and Aloha DeFi.
The hope is that Polygon PoS apps could operate on two blockchains at once. For example, Polkadot, Binance, and Ethereum. They claim Polygon Apps can operate on any Ethereum compatible blockchain.
What Value Does Polygon have?
I think Polygon (MATIC) has value because hundreds of DApps are running in its ecosystem. Additionally, Polygon seems to solve some of Ethereum’s problems.
In particular, Polygon could add scalability to Etheruem. To explain, scaling a blockchain means expanding the size and capacity of the blockchain to increase its speed of operation.
Currently, Coinbase estimates Ethereum processes around 15 transactions a second (TPS). That means an Ethereum could crash if tries to process 25 or 30 transactions at once.
Polygon’s potential Value is Enormous
Yet, Ethereum’s potential value is enormous because its the most popular blockchain. For instance, Coinbase estimates Ethereum had over $170 billion locked in its platform in November 2021. Moreover, yCharts estimates Ethereum was processing 1.218 million transactions a day on 14 January 2022.
Additionally, Ethereum (ETH) was the second largest cryptocurrency with a Market Cap of $400.516 billion, a Fully Diluted Market Cap of $399.471 billion, a 24-Hour Market Volume of $10.058 billion and a $3,360.63 Coin Price on 15 January 2021. Thus, Polygon can tap enormous value through Ethereum.
Finally, the potential user base for Polygon is vast. To explain, Investopedia estimates there were 442,647 ERC-20 (Ethereum Request for Comment) tokens operating on the Ethereum network in August 2021.
How Much is Polygon Worth?
Mr. Market believes Polygon (MATIC) could have value. For example, CoinMarketCap estimates Polygon was the seventh most trending cryptocurrency on 7 January 2022.
Moreover, CoinMarketCap estimates Polygon was the 13th largest cryptocurrency, with a Coin Price of $2.39 on 15 January 2022. Additionally, CoinMarketCap gave Polygon a $17.455 billion Market Capitalization, a $23.863 billion Fully Diluted Market Cap, and a 24-Hour Market Volume of $899.736 billion on the same day. They based those numbers on a Circulating Supply of 7.31 Billion MATIC, a Maximum Supply of 10 billion MATIC, and a Total Supply of 10 billion MATIC.
In contrast, Coinbase gave Polygon a Coin Price of $2.39, a Market Capitalization of $17.5 billion and a 24-Hour Market Volume of $901.7 billion on 15 January 2022. They based those numbers on a Circulating Supply of 7.38 billion MATIC. I consider Polygon a stable cryptocurrency because CoinBase gave it an all-time high of $2.92.
If you are looking for cryptocurrency with true value and genuine growth potential, I think Polygon is worth examining. I think Polygon has enormous value and growth potential because of the enormous number of Ethereum projects and users. I believe Polygon could grow as big as Ethereum at some point if its protocol becomes widely adopted.