Learning the differences when talking about Polygon (MATIC) vs Ethereum (ETH) is a great way to better understand the market. Interestingly, these protocols are not necessarily competition, but rather options to consider within the same ecosystem. Here is an insight into what makes Polygon and Ethereum two projects to watch in 2022.
What is Polygon?
Polygon works as a layer 2 scaling solution created to provide Ethereum developers with more functionality and lower fees. The developers behind the platform envision the protocol as an internet of blockchains. Part of this strategy is to speed up the creation of new blockchains. Polygon offers multiple options for developers ranging from standalone chains to sub-chains that take advantage of Ethereum’s security.
What is Ethereum?
Ethereum is one of the most successful cryptocurrencies of all time. Ethereal is the chain of blocks that houses the cryptocurrency Ether (ETH). These items are often confused as the same thing. However, Ether is used to pay nodes for smart contract executions on the blockchain. It can also be used to send value internationally without friction.
What problems was Polygon built for?
Polygon was built in retrospect of Ethereum. It was designed to help reduce some of the common pain points that Ethereum developers experience. The protocol specifically addresses developer restrictions and high gas fees caused by congestion. Polygon offers gas-free transactions, which is a great advantage for both developers and users.
Ethereum developers have run into many limitations due to network configuration. Ethereum was one of the first competitors in the market, which means that it lacks many of the most advanced features of today. Polygon features a highly customizable infrastructure combined with a scalable consensus algorithm to improve interoperability.
Lack of security
Dapp developers have suffered from security issues since day one. Polygon is an open source network that allows users to build on top of their network. The protocol provides developers with access to modular security features to enhance their operations. It makes it easy for corporations to upgrade their security using blockchain options.
What problems was Ethereum built to alleviate?
Like Polygon, Ethereum was created to improve on its predecessor. In the case of Ethereum, this predecessor is Bitcoin. Ethereum added functionality to the blockchain ecosystem and improved the sustainability and scalability of Bitcoin. Bitcoin is capable of around 7 transactions per second. By comparison, Ethereum can handle 15-30 in its current state.
Ethereum developer Vitalik Buterin wanted to simplify the creation and management of decentralized applications. dapps they are special programs that are designed to operate in decentralized networks. As such, they leverage network nodes to handle network calculations and validation. Ethereum is home to thousands of Dapps today.
How does the polygon work?
Polygon’s architecture is made up of multiple components. There are four layers that operate in tandem to complete network operations. The first layer is the Ethereum layer. This component handles the deployment of EVM instances. This layer is responsible for staking, DeFi, and inter-blockchain communication.
The security layer is another component that developers can take advantage of to improve their creations. Security protocols allow users to select the ones that fit their specific network needs. These validation services can be configured to handle management and other vital functionality.
Independent chains are a critical part of the Polygon ecosystem. These networks are designed to serve enterprise-grade customers and businesses. These systems are scalable and secure. As such, they are perfect for startups looking to take advantage of blockchain technology.
One of the best components of Polygon is its community governance system. MATIC token holders can stake their tokens for voting rights in the community governance system of the network. In particular, subchains and blockchains created on Polygon can choose to use the community governance option or create their own alternative.
How does Ethereum (ETH) work?
Ethereum is a second generation proof-of-work (PoW) blockchain. This designation means that it relies on community members called miners to remain valid. Miners accept gas payments to run EVM (Ethereum Virtual Machine) instances. They also ensure returns for approving transactions.
Ethereum miners do not use the same SHA-256 algorithm as Bitcoin. Instead, the Etash algorithm is used, which requires less power to maintain network security. It also helped Ethereum avoid centralized mining in its early days. However, today, there are high powered ASIC miners built specifically for the network.
Ethereum 2.0 Update
Ethereum is in the midst of its biggest upgrade to date. The network will be converted from a PoW network to a Proof of Stake (PoS) network. This upgrade will reduce gas costs and provide the network with much more scalability. According to Ethereum reports, this upgrade will boost Ethereum’s tps to 1,000 tps.
The move will also open the door for ETH participants. Currently, there are already ETH staking options available for users interested in securing the upgraded network. To qualify for an Ethereum staking node, you must have 32 ETH. Those who don’t have that many tokens can always join a mining pool to share the rewards.
How to buy Polygon (MATIC) and Ethereum (ETH)
Currently, both Polygon (MATIC) and Ethereum (ETH) are available for purchase on the following exchanges.
bit stamp – Founded in 2011, Bitstamp is one of the oldest and most trusted exchanges in the world. This exchange currently accepts residents of Canada, UK and USA. excluding the states of Alabama, Hawaii, Idaho, Louisiana, Nevada and New Jersey.
Defend – This is one of the best exchanges for United States and United Kingdom residents offering a wide range of cryptocurrencies. Germany and the Netherlands are banned.
Disclaimer: Assets available on Uphold are subject to region. All investments and transactions are risky and may result in loss of principal. Crypto assets are largely unregulated and therefore not subject to protection..
Binance – Best for Australia, Canada, Singapore, UK and most of the world. US residents are prohibited to buy most of the tokens. Use discount code: EE59L0QP for a 10% cash back on all business fees.
Driving adoption for ETH users
Both Ethereum and Polygon are popular projects that can help improve your portfolio. Ethereum is the reigning champion in the DeFi market, but has seen its crown taken away by competition due to congestion. Polygon helps alleviate these issues for Ethereum users, thereby strengthening the entire ecosystem. As such, there is room for both networks to thrive.