Part 11 of my deep dive research series will be on $MATIC.
Is Polygon the superior L2 scaling solution?
Let’s dive in…
Price = $1.15
Proof of Stake
Market cap = $10.4b – Rank 10
All time high = $2.92 (-60.6%)
All time low= $0.00314376 (36,492%)
Polygon is a blockchain scaling solution that aims to provide faster and cheaper transactions and is built on the Ethereum network. Several technical methods that can be used to scale a blockchain (Layer 2s)
Optimistic rollups (Optimism, Arbitrum)
ZK rollups
Sidechain
Polygon’s PoS chain is a sidechain that runs parallel to the Ethereum blockchain. It can process around 7000 transactions per second with transaction fees as low as 1 cent. In development is also the Polygon zkEVM chain- more on that later.
There is a lot of buzz around Polygon, so I recommend reading @Route2FI 's thread to catch up on the latest.
Revenue
Polygon comes in 6th overall (7-day revenues) and 2nd only behind Ethereum for blockchains. Daily numbers are
Revenue = $49.2k
Fees = $90.4k
Both fees & revenue are in a strong uptrend since the start of the year.
9 for Revenue.
Treasury
In a statement made in Feb, Nailwal noted that the Polygon treasury “remains healthy” with a balance of more than
$250 million and
1.9 billion $MATIC = $2.1b
TOTAL = $2.4b
If this is true, that is a sizeable war chest.
9 for Treasury.
Tokenomics
The initial distribution of $MATIC was:
12% - Staking Rewards
23.33% - Ecosystem
21.86% - Foundation
4% - Advisors
16% - Team
3.80% - Private Investors
19% - Binance Launchpad
The native token of Polygon’s PoS chain is $MATIC. In a similar fashion to most other PoS chains, it is used to
Pay for transaction fees
Validators lock MATIC to power nodes
Stakers are paid in MATIC (Validators & delegators)
Currently you can earn a healthy APR by staking your MATIC. Although when adjusted for inflation of token supply, this is reduced to around 2.5%.
4.78% APR- Delegators
5.15% APR- Validators
8.5 for tokenomics.
Locked up funds
According to coingecko, these are the current supply stats
Circulating supply = 9.05b
Total supply = 10b
Market cap = $10.4b
FDV = $11.5b
Market cap/ FDV = 0.91
This means that around 91% of all MATIC tokens have been unlocked, with the remainder to be fully vested by April 2025.
9 for locked up funds.
Use case
Polygon has cemented itself as one of the leading scaling solutions on Ethereum. TVL is sitting at $1.23b which is well down from its peak ($9b), but keep in mind we are at the tail end of a bear market.
Daily transactions have been flat for the past year- down from a peak of 9m in June 2021. But sitting at 3m daily transactions during a bear market is pretty impressive.
Polygon are kicking some serious goals in terms of real-world use cases & partnerships.
Reddit digital collectibles
Robinhood Web3 wallet
Starbucks Odyssey rewards
8.5 for Use case.
Roadmap
One of the most anticipated upcoming features is the launch of the Polygon zkEVM Beta Mainnet- scheduled for 27th March. Here is a great thread from @rektfencer to get you up to speed.
The Polygon ecosystem continues to grow, with the following products in development or recently launched.
Polygon zkEVM (March)
Polygon Supernets
Polygon Miden
Polygon ID (now live)
8.5 for Roadmap.
Team & funding
Polygon (formerly Matic) was founded in 2017 by @jdkanani , @sandeepnailwal , @anuragarjun & @MihailoBjelic. In April 2019, the team raised $5.6m during an IEO on Binance launchpad to fund development. Matic mainnet was launched in Q2 2020.
In one of the largest crypto funding rounds of recent history, Polygon raised $450m in Feb 2022. Led by Sequoia Capital India and over 40 venture funds.
In February 2023, Polygon announced a 20% headcount reduction (100ppl) as part of organisational restructuring.
Polygon has been absolutely crushing it with partnerships and business development recently.
Reddit
Starbucks
Disney
NFL
Robinhood
9 for Team & Funding.
Summary
TLDR summary for each category’s score out of 10.
9 - Revenue – $50k daily revenue
9 - Treasury– $2.4b in treasury
8.5 - Tokenomics – Fixed supply, staking rewards
9 - Locked up funds – 91% of tokens in circulation
8.5 - Use case – 1.23b TVL, 3m+ daily transactions
8.5 - Road map – zkEVM- 27th March launch
9 – Team & funding – Huge funding, excellent BD
TOTAL- 8.8 weighted avg. score
You can view all my previous deep dive ratings for free below. https://docs.google.com/spreadsheets/d/1mPGbrsSEqBCN4lTVIIfdu3UzhZVqGP6LWMXlJrWJ5RE/edit?usp=sharing
Polygon has established themselves as one of the leading blue-chip altcoins. They continue to develop products and nail their business development. With a mcap of 10b, you might not see 100x gains, but I still believe MATIC is poised for some nice growth next bull.
The purpose of this thread is for education and research- not financial advice. Always DYOR before Apeing in. Here is a framework I prepared earlier.
The current macro conditions are still very choppy so stay safe out there frens.
Tagging some accounts to follow for all the Polygon alfalfa.