Interview with Polygon Co-Founder: The Great Migration of Old and New Protocols and How the “Indian Crypto Unicorn” Was Made

What is the “magic” of Polygon that has gained so much popularity?

With the continuous tightening of regulation, cryptocurrencies have been badly hurt after the “519 crash”. Especially in the face of policies that have not yet been fully implemented, the market rebound is weak and the money-making effect is poor, so investor sentiment continues to be sluggish.

However, Polygon (formerly Matic), the “Swiss Army Knife of Ether”, has grown against the trend of the avalanche plunge. 196% rally since the “519 crash”, outperforming the majority of crypto assets. When we stretch the timeline, MATIC’s performance is equally impressive, with the price of MATIC surging up to 490 times since its initial release in 2019.

The surge in coin price has made Polygon’s co-founder a billionaire, and also made the once valued at only $26 million grow into a $10 billion Indian crypto unicorn. Recently, PANews interviewed Sandeep Nailwal, co-founder of Polygon, to see what is the real ability behind the explosion of this ethereum expansion superstar?

From Matic to Polygon, how is Layer 2 aggregator made?

Polygon, formerly known as Matic Network, is a self-proclaimed scaling solution to solve the congestion of Ether. 2017, when Ether was coming to a wider public view, it was criticized for its performance problems such as congestion and inefficiency, and users were suffering. To create a more open world, three techies with years of experience in technology and product development, Sandeep Nailwal, Jaynti Kanani and Anurag Arjun, came together to create Matic Network in 2017, followed by Mihailo Bjelic, a prominent contributor to the Ether ecosystem. Bjelic joined the team in 2020 as a co-founder, and the founding “Four Dragons” officially completed the team.

Interview with Polygon Co-Founder: The Great Migration of Old and New Protocols and How the "Indian Crypto Unicorn" Was Made

Jaynti (JD), born in Ahmedabad, India’s sixth largest city, is obsessed with scaling solutions such as Plasma and stateful channels, and is an active contributor to the Ether ecosystem, having made significant contributions to Web3, Plasma and WalletConnect.

Polygon adopted Plasma as a scaling solution in the early days, and even became the representative project of the solution at one time. 2017, due to the skyrocketing usage of Ether, its performance was overwhelmed by the growing demand, and developers and users became increasingly worried about the future of Ether applications, and finding a new scaling solution became an urgent need. Among them, Plasma, co-pushed by Vitalik Buterin, the founder of Ether, and Joseph Poon, the co-author of the lightning network white paper, quickly attracted widespread attention. Although Plasma was once treated as the main force for scaling, problems such as unusually complicated funding withdrawal and incompatibility with DeFi smart contracts made Plasma gradually “fall out of favor”.

With that, ZK Rollup, Optimistic Rollup, and other expansion methods that each have trade-offs are moving to center stage. Polygon is determined to break the silo effect caused by the current Layer 2 solution’s liquidity and technical fragmentation, and in February this year, it was reborn as Polygon. In February this year, Polygon was reborn as Polygon, and proposed the idea of “integration”, and started to develop various Layer 2 scaling solutions such as zkRollups, Optimistic Rollups, Validium, etc., in order to build a modular, universal and flexible scaling framework for Ether.

However, Sandeep Nailwal also said, “Polygon’s goal has always been to support developers and users with more preferred scaling solutions, and Plasma will continue to be actively supported by Polygon as one of the scaling solutions. Polygon hopes to become a Layer 2 aggregator by supporting multiple scalability solutions, including Plasma, so that developers can choose the solution that best meets their needs through easy-to-use products such as the Polygon SDK.”

Despite the buzz around the Layer 2 track, Layer 2 is seen by many as essentially a trade-off, serving only as a transitional solution for ETH 2.0’s temporary inability to get off the ground. And with the arrival of ETH 2.0 in the future, how should Polygon, as an aggregator of Layer 2 solutions on the ethereum chain, position itself for the role?

“The arrival of ETH 2.0 will allow Polygon to become more scalable and flexible, which is a scalable supply. The current demand for ETH 2.0 as it moves up on Ether already exists, and even if it grows rapidly, it will encounter the same bottlenecks, which is why Vitalik is proposing a Layer 2-centric roadmap for Ether. vitalik notes that ETH 2.0 will only have data availability shards, which means they only have data for the application, and the final execution still is still on Layer 2. In the future, ETH 2.0 will be 64 times more scalable than Ether now, but also 1000 times more demanding, so users will need a Layer 2 scalability solution provided by Polygon.” Sandeep Nailwal noted in an exclusive interview with PANews.

From Matic to Layer 2 aggregators, Polygon is using the aggregation mindset to push a new door open for the scalability track.

Ecology on the rise, DeFi and NFT to be future breakout points

Behind the strong price spike of MATIC, Polygon’s ecology continues to expand and prosper. In particular, mainstream applications such as Opensea, Aave, Sushiswap, Curve and 1inch have integrated Polygon in unison, and these applications have not only accumulated considerable lock-in funds as a result, but also further made Polygon’s reputation. SushiSwap, for example, tweeted that its total locked positions on Polygon had reached $1 billion in less than a month since launch. Aave has now attracted more than 30,000 users on the Polygon chain, as well as more than $7.5 billion in liquidity. However, these scaling solutions such as Optimism and Arbitrum, for example, are also being supported by headline projects such as Uniswap and Metamask as well, and neither has yet issued a governance token, so the momentum cannot be underestimated.

And according to DeFiPulse data, as of this writing, Polygon TVL (total locked-in assets) is over $7.5 billion, ranking fifth. Meanwhile, The Block statistics show that the Polygon ecosystem has now attracted up to 356 projects and companies across 13 sectors.

Interview with Polygon Co-Founder: The Great Migration of Old and New Protocols and How the "Indian Crypto Unicorn" Was Made

Source: The Block

Sandeep Nailwal explains that Polygon is the first structured, easy-to-use platform for Ether scaling and infrastructure development, with Polygon SDK as its core component, a modular and flexible framework that supports building and connecting two-tier chains. In addition to Plasma, Optimistic Rollup, ZK Rollup and Validium are supported, as well as sidechains such as Matic POS, to provide better independence as well as flexibility. This has led to Polygon’s Ether Scaling solution being widely adopted by over 350 DApps, approximately 11.2 billion transactions, and approximately 9.72 million users.

Among other things, Polygon SDK can provide a framework for further rapid development of multi-chain Ether, turning Ether into a full-fledged multi-chain system. Sandeep Nailwal explained to PANews that multi-chain Ether will be similar to other popular multi-chain systems, such as Polkadot, Cosmos, etc., but as a blockchain Internet for Ether Polygon SDK has differences, including the ability to benefit from the network effects of ETH, higher security (Polygon SDK chains can inherit the security of Ether), and more flexibility and power.

“Top DeFi protocols, the hottest gaming and NFT projects, and enterprises or organizations that can apply blockchain to real-world use cases will be where Polygon is focusing its attention.” Sandeep Nailwal noted as much in the face of the growing demand for migration of projects.

To attract and support more DeFi projects, Polygon also launched a $100 million DeFi-specific fund, DefiForAllFund, in April to support DeFi projects over the next two to three years to increase adoption, accessibility and cost effectiveness of DeFi without the high fees and costs.

The future of Polygon’s ecosystem will be even more imaginative.

Financial security is controversial, and the future is to be a one-stop “store”

Polygon’s fame has been accompanied by questions about the safety of its funds. In Polygon, the security of funds is achieved by the Plasma framework and the PoS verification mechanism. Plasma relies on the underlying ethereum blockchain to achieve its security, but it requires a 7-day waiting period for withdrawals, which means that the user’s funds are frozen and cannot be used during this 7-day period.

PoS Bridge, on the other hand, is more flexible, with withdrawals taking only about three hours, but its security is guaranteed by the same set of verifiers and pledged MATIC. Node verifiers can earn newly minted MATIC token rewards by pledging MATIC tokens, and when verifiers pledge MATIC to a smart contract hosted on the Ether main chain, they must go through a bridge to migrate funds from Ether to Polygon to do so. This fund extraction process can be understood as the unlocking of funds from Ether is completed when the tokens sent by the verifier to Polygon are destroyed for extraction.

However, Polygon’s multi-signature wallet-controlled agent is responsible for all pledging and bridging contracts. It is well known that the transfer of funds from multi-signature wallets requires authorization from multiple keyholders, and Polygon’s multi-signature wallet has eight signatories, including Polygon co-founders, as well as members from the Polygon DeFi project, which has raised questions about its over-centralization. However, Polygon’s multi-signature wallet has also upgraded from 2/3 multi to 5/8 multi-signature to reduce outside concerns about the security of its funds.

As of this writing, there are 100 verifier nodes, pledging nearly 1.64 billion MATIC tokens, or 16.4% of total supply, and distributing over 268 million MATIC rewards, currently valued at $380 million. It is worth mentioning that about 30.9% of the pledged MATIC tokens are entrusted to Binance nodes, which also reflects the centralization of MATIC token pledges from the side. However, in response to the mischief of verifiers, Polygon has taken to forfeit the pledged MATIC tokens, thus reducing this phenomenon.

In addition, Polygon has concerns about 51% attacks. For example, Vitalik Buterin, the founder of Ether, has also questioned that the supply of MATIC tokens is not widely distributed and that 51% of MATIC token holders could launch an attack. polygon is not protected by Ether, but by its own PoS consensus, which places more emphasis on functionality than security, which is itself a drawback of its network.

But this security skepticism about 51% attacks is not shared by EtherFoundation developer Dankrad Feist. In his opinion, what a 51% attack can do is prevent users from using the blockchain and rolling back blockchain transactions, etc., but it cannot change the rules of the system, which means that attackers cannot simply issue new tokens outside of the blockchain system’s regulations, while if they do not have the private key of a certain address, they cannot use the tokens of that address, etc.

Although Polygon still has imperfections, it has helped Ether evolve into a highly scalable and mature multi-chain system with a developer-friendly SDK that may become the technological backbone of the Web3 application revolution.

Sandeep Nailwal told PANews, “Next, Polygon will continue to focus on developer and user adoption, and help more users around the world engage more deeply with DeFi and Ether. In particular, with the launch of the Polygon SDK, developers, projects and enterprises can launch sidechains for a variety of application needs. We will soon be integrating other Layer 2 scaling solutions such as zK and Optimistic rollops into the Polygon SDK, making it a one-stop ‘store’. In addition, Polygon could even launch shared security chains, such as Polygon’s Commit Chain (Submission Chain), which is backed by Ether security.”

All in all, at a time of surging market demand for Ether scaling, although Polygon’s ecological layout is taking shape, it is still early days, especially as competitors are eyeing and fist-pumping. As its co-founder Mihailo Bjelic said, “The cake is very big, don’t rush.”

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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