Polygon is a layer 2 scaling solution built on the Ethereum blockchain that aids in the acceleration of transactions performed by Ethereum-based Dapps. It is likely that the Polygon network will provide a solution to Ethereum’s scalability issues.
Polygon aims to increase cryptocurrency acceptance globally by addressing scalability issues across multiple blockchains.
- Polygon is a crypto sleeping giant about ready to wake up in 2022
- It is the Ethereum blockchain’s leading layer two solution
- Whatever you do on Ethereum, you can do on Polygon-but for a fraction of the price (see low gas fees on OpenSea NFT transactions)
- Polygon is also faster than Ethereum
Here are a few reasons you may want to add Polygon to your portfolio.
Rapid Expansion
Polygon has been growing at an exponential rate. They recently purchased two zero-knowledge rollup projects (Hermez Network for $250 million and startup Mir for $400 million) that will aid in the scalability of Ethereum’s blockchain.
This ZK rollup technology allows hundreds of transactions to exit the main chain (layer 1) at the same time by combining (or “rolling”) them into a single transaction. In other words, Polygon is taking on the role of Ethereum on steroids. Polygon is not only faster, but also much less expensive.
Polygon’s Nightfall solution, developed in collaboration with multinational consulting firm Ernst & Young, will address two issues: privacy and costs. Enterprises and institutional investors require greater privacy when transacting on the Ethereum blockchain, and Nightfall can deliver on that promise. Furthermore, it will reduce gas fees between ERC20 token transfers by up to 86 percent.
Cross-Chain Transactions are Booming
Polygon bridges have seen $500 million inflows over the last 7 days [29th of December, 2021] and more than $28 billion all time, dwarfing all other blockchain bridges — illustrating the network’s utility for cross-chain users.
The Polygon bridge allows users to connect the Ethereum and Polygon blockchains more easily, transferring assets between the two networks with minimal fees. With this type of activity, you can see Polygon’s utility in the cryptocurrency space and how much money is flowing into its ecosystem. Consider how much more money will flow in once Polygon integrates with metaverse projects like Sandbox and Decentraland.
Polygon Had a Banner Year in 2021
This is what you should be looking for if past performance is any indication of future success.
Polygon achieved the following incredible goals in 2021:
- Polygon’s unique addresses surpassed 100 million
- More than 3,000 apps are now available on the Polygon chain, an incredible increase from just 30 apps in 2020
- Polygon is growing two times faster than Eth at this stage in its development, according to Alchemy, a blockchain development platform
- SDK, Avail, Hermez, Nightfall, Miden, Mir, and Zero are the seven new solutions they’ve created
- Aave , Uniswap, and OpenSea were among the top Web3 projects to join the Polygon
Massive brand partnerships were formed, including Dolce & Gabbana (which launched its NFT collection on the Polygon-powered NFT marketplace UNXD), the National Football League (which released their NFT ticketing collection on the Polygon network), Macy’s (which launched its NFT collection on Polygon), and many more.
How’s this for optimism?
Polygon Added 7,000 Developers in December Alone
Cathie Wood has a mantra: “Stay with the developers”. She recommends developer activity and migration as things to track when looking for a valuable crypto project. Polygon has that in spades.
Invest in the technology that developers are working on, that they enjoy, and that they use. Polygon is experiencing a massive migration. In December 2021, more than 7,000 developers joined their team.
Why is this important? More smart contracts can be deployed on the network as there are more developers. Polygon developers, for example, deployed over 1.8 million smart contracts in the last week of December, compared to 105,000 on Ethereum.
Numbers and activity like this make Polygon’s current price of $2.05 appear massively undervalued.
Final thoughts
The success and adoption of the Ethereum network is also one of the reasons Polygon gained significant traction in 2021. Although Polygon currently only supports Ethereum base chains, the network intends to add support for additional base chains in the coming years.
Polygon may explode by the end of 2022, attracting more partnerships and projects worldwide, given all of its brilliant features, current price rally, and plans to expand its network. These are just a few of the reasons why Polygon could be a Top 10 crypto in 2022 and beyond.
This article is provided for educational purposes only. As always, do your own research and invest only what you can afford to lose as cryptocurrencies can be volatile investment instruments. The writer holds Polygon (MATIC).
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Jay Speakman is a technology writer based in San Francisco, California. He writes on the topics of blockchain, cryptocurrency, DeFi and other disruptive technologies. Clients include Avalanche, Be[in]Crypto, Trust Machines and several blogs devoted to blockchain gaming. He will not rest until fiat currency is defeated.
