The most popular cryptocurrency, Bitcoin, along with Ethereum, Solana, and dozens of those coins, are entering the cryptocurrency market every day or growing in terms of value and how popular they are.
It is hard to follow this market for the same reason: You never know which one will be the next bitcoin in price and profitability.
Overall, cryptocurrencies are becoming huge resources based on the world we are in today, which highly relies on the Internet, and everything is digital; let’s just face this.
Thus, investing in those coins is only natural and will become a necessity even if you don’t wish to handle them for now. The big question is, how can you learn about what coin is the best? How can you use them? And all the details surrounding this market.
The best advice we can give you is to take the time to know all the currencies on the market, at least the most relevant ones, and then focus on the not-so-popular yet are influencing in the market.
Since we have covered the important ones so far, we found it crucial to go over some that many people are ignoring, and yes, Polygon (MATIC) is included here, which is why it will be our topic today.
By the end, you should be able to decide whether this option is the next you need, or if there are better opportunities and alternatives to invest your money instead of choosing this new cryptocurrency.
What Is Polygon? – Learning the Basics
Before we start, you should know that these cryptocurrencies are more than the coins everyone knows about.
Instead, they are blockchains, protocols and have other main functions and purposes besides the simple fact of being an alternative for payments.
With this in mind, we can start the introduction to Polygon and then focus on MATIC because, yes, they are dancing together but not sleeping on the same bed.
Polygon, formerly known as Matic Network, is a framework designed to interconnect blockchain networks, provide multiple tools to improve transactions and address all the problems the networks present.
To be specific, it seeks to address some of Ethereum’s major limitations since it was created by the same developers involved with it: Jaynti Kanani, Sandeep Nailwal, and Anurag Arjun with the help of Mihailo Bjelic.
Although it has been recently launched, Polygon was created in 2017 in India and was then changed to this name from Matic Network.
What are Ethereum’s major limitations? For those who have traded on the platform, the answer is obvious. For those that haven’t, the issues include its throughput, poor user experience that involves speed and delayed transactions, and lack of community governance.
Originally, Matic Network was designed as a scaling solution that uses a technology called Plasma to process transactions off-chain and then finalize them on the Ethereum mainchain.
However, the developers changed this for Polygon and decided to focus on it as a platform that can be used to launch interoperable blockchains.
Developers can use Polygon to launch pre-made blockchain networks that have attributes that are tailored to their requirements.
They can also further customize these networks with a growing number of modules to create sovereign blockchains with more specific functionality.
Then, What Is MATIC?
All blockchains, protocols, systems, or programs related to the market and industry you know today have their own token or “coin,” as many people call them.
In the case of Polygon, MATIC corresponds as its token.
The token’s name comes from Matic Network despite the fact this has expanded beyond the original protocol, but developers found it functional to maintain the same virtual currency.
What you need to know about this token is that it is used, mainly, on the Polygon ecosystem for many purposes:
- To participate in network governance by voting on proposals.
- Contribute to security using skating in addition to the usual online ledger.
- Paying gas fees.
Others are included based on the ecosystem’s growth. However, there are doubts about its functionality since, as of 2021, so far, there haven’t been details if the token will have a broader utility.
Now, this doesn’t mean MATIC is a bad option when it comes to investing or accessing it.
In fact, MATIC is one of the best cryptocurrencies according to the cryptocurrency market cap and has excellent liquidity many decide to enjoy.
The good part about it, which other popular and top currencies don’t tend to share, is that there is a big supply. You can purchase or trade it on many decentralized cryptocurrency exchanges, including Coinbase Pro, Binance, Huobi, and Polina.
Uniswap, which is the most popular decentralized exchange, is included on the list.
In our case, we recommend using Binance since cryptocurrency transactions are quite simple and fast, especially for beginners who don’t know much about purchasing and trading.
The supply is capped at 10 billion, and currently, about 6 billion are available on the decentralized market.
By the end of 2022, all the tokens should be released according to the developers.
How Does Polygon (MATIC) Work?
Since we’ve cleared the main part, we can start focusing on the general topic and follow both the ecosystem and token on this.
It can be a bit hard to understand the architecture of the blockchains, protocols, and tokens if you are not familiar with certain terms.
However, we will do our best to keep this simple.
Polygon is based on a four-layer structure: the Ethereum, security, Polygon networks, and execution layers.
The first layer (Ethereum) is quite simple to understand since it is a set of smart contracts implemented on the main platform of the blockchain.
If you aren’t familiar with these smart contracts, they basically handle transactions, staking, and make the communication between Polygon chains and Ethereum possible.
The security layer is just as its name suggests and works with the main Ethereum security system. However, this and the previous layer are optional and aren’t necessarily required to operate on the ecosystem, but we do suggest following the entire architecture.
The remaining two layers, starting with the Polygon networks, are mandatory.
The latter is basically the entire ecosystem of the blockchain networks built on it, so there wouldn’t be a point in excluding it since there wouldn’t be an ecosystem in the first place.
Finally, the execution layer also follows its name and allows the execution or implementation of smart contracts.
Polygon allows the simple yet crucial communication with Ethereum and allows new elements to take place like decentralized applications and speeds up the exchange between networks.
Another explanation we must add to how it works is the fact that Polygon uses a Proof of Stake (PoS) system of validators for security and staking.
The people taking roles in the ecosystem are able to stake MATIC as collateral to take part in the PoS consensus. When they join, then they receive tokens in exchange.
Polygon (MATIC) Purpose & What Makes It Special
Finally, the part we usually find to be the most interesting one: Knowing why you might need this ecosystem and token.
All ecosystems and chain networks have their purposes and, believe it or not, tokens too. Though we already mentioned what we needed about the latter, so let’s focus on the entire picture.
To keep it simple, Polygon was designed to speed everything, make Ethereum and the exchanges safer, and address the general issues as we mentioned.
However, this doesn’t explain what it offers.
Specifically, Polygon offers tools and technology that allow improving the blockchain performance, thanks to the sidechain product.
This sidechain connects to the blockchain and improves its performance greatly, including lowering fees and making transactions faster.
Although Polygon is dedicated to Ethereum, this option works for all blockchain technology available.
Other solutions and benefits include:
- The future goals: The owners want it to provide a framework for blockchain networks.
- The protocol is compatible with the Ethereum Virtual Machine, which developers use to create decentralized apps.
- Going back to the token, it can be used (overall) for fees, governance, and staking.
What you might not understand unless you go a bit deeper into the general topic of chains, cryptos, and all, is that Polygon is more than the current structure and project you see.
This attempt at blockchain interoperability and scaling is also designed to handle the current issues with other networks like Polkadot and Cosmos.
Making a Decision: Invest or Skip?
With so many cryptocurrencies and options out there in terms of functionality and purposes of the ecosystem, is it actually worth investing in Polygon or starting to use it?
The thing about this very recent system is the fact it isn’t entirely complete. Instead, it is aiming to be the first interoperability solution to be reliable and completely available.
This means you need to focus on this as a future investment in every single aspect since everyone agrees Polygon is more a bet than a current option.
Considering that competitors like Polkadot and Cosmos are also launching their interoperability solutions only makes this decision harder.
Also, it is hard to tell someone what to do with their money and time, but to keep this simple: Only invest depending on what you need or are looking for.
If you focus on Polygon as a token (MATIC), the alternative isn’t bad. Still, you must know that among this volatile market, this one is part of the toppers when it comes to lower or higher prices in digital currency.
Just keep in mind its use continues to be limited as well, and the previous three uses are the only ones you can expect and just a piece of good investment advice: You should go for other cryptocurrencies as well.
Finally, if you plan to enter this world, going over terms like a digital ledger, blockchains, and more, is the best way to start.
But what if you are trying to invest in cryptocurrencies overall in order to have a long-run investment or place your money somewhere? Then, we highly recommend you don’t put all your eggs on this. Instead, bet for actual businesses.
Cryptos are way too volatile to rely on them. Thus, it is better to focus on business opportunities like lead generation.
This business can be done from home, with the Internet, a computer, and some investment but will lead you to a major benefit: Passive income.
The best part is that it isn’t too difficult:
- You choose a niche in the market.
- Find clients in it.
- Offer your lead generation services (build a website for the client, rank it on Google, and generate leads).
- When they accept, you start working on it.
- Make money for each lead you generate.
It does require effort and time, and training is needed to have the knowledge about web design and other aspects, but it can be solved with the right training program.
Interested in the offer? Here are the details of the program!
Here’s Our #1 Recommended Online Business Model:
Interested in starting an online business to build passive income? Check out the local lead gen business model. Click here to learn more.
