Kryptolesson #14

What is Polygon?

Polygon ↗ is a multi-chain scaling solution for Ethereum which aims to provide faster and cheaper transactions using Layer 2 sidechains – separate blockchains that are attached to the Ethereum main chain. The protocol addresses the current limitations and pain points of Ethereum including the poor user experience from low throughput and high gas fees as well as the dependence on Ethereum governance decisions. Polygon is also focused on infrastructure development through its framework that allows developers to build, deploy and connect blockchains that are compatible with Ethereum. So far, common fallback options to mitigate the above-mentioned limitations (e.g. using other blockchains and bridges) have come with significant friction or additional costs, also weighing on the user experience. Polygon proposes another solution to these constraints: a protocol and framework for building blockchains that are compatible with Ethereum without sacrificing scalability, security or sovereignty. At the heart of it is its Polygon SDK ↗, a developer-focused feature set that enables building and connecting secured chains such as Plasma, Optimistic Rollups and zK Rollups. Polygon supports two major types of Ethereum-compatible blockchain networks: 1. stand-alone networks and 2. networks that leverage “security as a service”. The former are sovereign networks that are fully in charge of their own security, ​ that is, they have their own pool of validators. The second group does not have its own validators but is secured by Ethereum. Its security can be provided either by Ethereum directly (via fraud proofs or validity proofs) or by a pool of professional validators (similar to Polkadot’s shared security model).

Technically, Polygons’ architecture is made up of four layers. Ethereum acts as its bottom layer that are available to Polygon chains, although its use is merely optional (as outlined above). The same applies to its second layer, its security layer, which performs validator management and validation of Polygon chains. In contrast, the third layer – or Polygon Networks Layer – is a mandatory layer that consists of sovereign blockchain networks that each are in charge of vital functions such as block production, transaction collation and data ordering. The top layer – or Execution Layer – includes smart contract functionality and interprets and executes transactions that are agreed upon and included in Polygon’s network blockchains. Polygon’s Layer 2 chains have seen significant adoption with more than 350 Dapps ↗ including major DeFi protocols as well as NFT platforms and games. When using a Dapp, users can lock up their Ethereum tokens via a Polygon bridge smart contract, use them within a Polygon sidechain and withdraw them back to the Ethereum main chain at any time. The Polygon Network’s native token is called MATIC , an ERC20 token. Its holders own and govern the protocol. MATIC ↗ is used to pay transaction fees and to participate in proof-of-stake consensus through staking ↗.

Photo by Mithul Varshan