Polygon’s ‘Ethereum Killer’ Status Will Push It Even Higher
InvestorPlace - Stock Market News, Stock Advice & Trading Tips Polygon looks set to move significantly higher. Polygon crypto could keep rising based on its popular appeal as a viable...
Polygon (CCC:MATIC-USD) crypto is a layer-two Ethereum (CCC:ETH-USD) blockchain. It was known as Matic until it changed its name in February, keeping the MATIC token name. The backers of Polygon wanted to highlight its new features as an interoperable and scaling network. This makes it useful for decentralized finance (DeFi) applications.
Polygon now bills itself as “Ethereum’s Internet of Blockchains.” It functions as a software development kit (SDK), or a platform that enables developers to launch preset blockchain networks. As such, it is a multichain system.
Polygon is the 21st largest cryptocurrency with a market capitalization of $12.5 billion as of Nov. 9. So far this year, the MATIC token has done quite well. For example, it ended last year at 1.781 cents per token. But as of Nov. 9 mid-day, it was at $1.83.
Moreover, in the last three months, Polygon crypto has risen 58% from $1.1576 on Aug. 9. This is even after the crypto peaked at $2.4544 on May 18.
In other words, Polygon has been quite volatile — like many cryptos this year — but it is clearly on an uptrend.
Polygon’s Team and Focus
One of the most important aspects of analyzing a blockchain is reviewing its team. Polygon has a decentralized team of contributors from all over the world that continue developing the open-source network.
Polygon has four co-founders: Jaynti Kanani, Sandeep Nailwal, Anurag Arjun and Mihailo Bjelic. They all have extensive software experience. For example, Sandeep Nailwal, the COO of Polygon, was also the co-founder and CEO of ScopeWeaver.com. That company produces decentralized apps (dApps) for businesses.
The company’s name change to Polygon was to highlight, among other things, its ability to reduce transaction fees for users of Ethereum-based applications. In other words, it allows an alternative scaling solution for Ethereum.
For example, Polygon both increases transaction speeds and dramatically lowers transaction fees. So, it has multifaceted (hence, “poly”) approach to the blockchain issues that presently plague Ethereum. In fact, some called it one of the original “Ethereum killer” blockchains.
Polygon has a way of getting around Ethereum’s scalability problem. It builds “snapshots” of various chains and uses them in the blockchain network. This is important for high-speed and large-scale transactions, especially in the DeFi arena.
What to Do With Polygon Now
Earlier this year, Polygon announced via Twitter (NYSE:TWTR) that it had secured an investment from Mark Cuban. He is a major proponent of cryptocurrency investments, as he sees these assets as an indelible part of investing in the future.
The point here is that if an investment in Polygon is good enough for Mark Cuban, who is well-known as one of the original Shark Tank investors, it should be good enough for others. However, he does feel that some regulation should come into play — especially with stablecoins.
But Polygon is not a stablecoin. It will be volatile. It will grow in value in scale with Ethereum, which it is designed to compete against.
So what should investors do now? The fact that Polygon has risen so much this year might put some off. After all, most cryptos took a big hit during the spring. Could this happen again?
The answer is yes, it will definitely happen again. That is because it is quite clear MATIC tokens are highly volatile.
But the crypto has been on an upward trend. The total value locked up (TVL) in Polygon applications has also been growing, as can be seen at Defi Llama. As of Nov. 9, it showed that $5.16 billion was in deposit as MATIC tokens, either in exchanges or dApps. Moreover, the chart shows the trend in TVL is rising over time.
That implies the value of Polygon will continue to rise, especially as its role as a viable alternative to Ethereum grows.
On the date of publication, Mark R. Hake did not own any security mentioned in the article, directly or indirectly. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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