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Polygon ($MATIC) Eclipses ‘Ethereum L1 in Daily Active Addresses for the First Time’

Polygon ($MATIC) Eclipses ‘Ethereum L1 in Daily Active Addresses for the First Time’


Polygon ($MATIC) Co-Founder Mihailo Bjelic says that on Monday (September 27) Polygon’s number of unique daily active addresses surpassed that of layer 1 blockchain Ethereum for the first time.

Last month, crypto influencer “Coin Bureau” (“@coinbureau” on Twitter) talked about $MATIC, which is one of the few cryptoassets that he regrets “not buying sooner.”

In a video (titled “TOP Altcoin Picks 2021 Q3”) released on YouTube channel “Coin Bureau“, the show’s pseudonymous host told the channel’s over 1.2 million subscribers why he is so bullish on $MATIC and gave his year end price target.

He had this to say about $MATIC:

  • Polygon is “the preferred layer 2 scaling solution” for Ethereum.
  • Some of the very popular decentralized applications (Apps) that have built on Polygon include Ave ($AAVE), Decentraland ($LAND), and SushiSwap ($SUSHI).
  • Its 300+ DApps hold over $9 billion in total value locked (TVL).
  • Both Coinbase and Binance have recently completed Polygon wallet integration.
  • Number of active users (which is growing very rapidly) is more than that for some layer one (L1) blockchains.
  • $MATIC not only powers the Polygon blockchain but it is important for Polygon’s expanding set of layer two (L2) blockchains for Ethereum.
  • Since the start of 2021, $MATIC has had “a magnificent run.” Although the crypto market crash in the second half of Q2 2021 brought the $MATIC price down from its all-time high (ATH) of $2.44 (reached on May 18), with “mass adoption”, the price of this cryptoasset has a “realistic” chance of hitting $5 by the end of this year.

Back on May 18, Anthony Sassano, who joined Polygon as an advisor this year, took to Twitter to clear up some of the confusion around Polygon (e.g. some people refer to Polygon as a sidechain to Ethereum, while others call it an L2 blockchain). Below are a few highlights from that Twitter thread:

  • There is the Matic Plasma Chain and the Polygon PoS chain. The vast majority of the activity is happening on the PoS chain.
  • The PoS chain is what people refer to as a ‘sidechain’ to Ethereum because it has its own permissionless validator set (100+ who are staking MATIC) which means it doesn’t use Ethereum’s security (aka Ethereum’s PoW).
  • The PoS chain goes beyond a standard sidechain and actually relies on and commits itself to Ethereum (what some people may call a ‘commit-chain’). It relies on Ethereum because all of the validator/staking logic for the PoS chain lives as a smart contract on Ethereum.
  • This means that if the Ethereum network went offline, the Polygon PoS chain would also go offline. Secondly, the PoS chain actually commits/checkpoints itself to Ethereum every so often.
  • This has 2 benefits: it provides Ethereum-based finality to the PoS chain & it can help the chain recover in case of catastrophic event. This also means that Polygon is paying Ethereum to use its blockspace (in ETH) & paying for it to secure the contracts & checkpointing.




Sassano also took this opportunity to talk about the two bridges that exist between Ethereum and Polygon:

  • There are 2 bridges – the Plasma bridge which is secured by Ethereum and the PoS bridge which is secured/operated by the PoS chain validator set.
  • Of course, for the PoS bridge, 2/3 of the validators could theoretically collude and try to steal the bridge funds but there’s $3.4 billion at stake so this is risky. If this attack did happen, the checkpointing & social coordination could be the only recourse.

He also talked about the multi-sigs for Polygons contracts:

  • The multi-sigs exist to allow the contract to be upgraded in case of a bug/exploit which is a practice used by many existing projects (especially those within DeFi).
  • However, Polygon’s multi-sigs are 5 of 8 which is definitely not ideal and not decentralized and the plan is to greatly improve this in the near future.

Finally, he said that Polygon is “committed to building & deploying L2 solutions like rollups in the future” and this is what he is “most excited about.”

According to data by TradingView, currently (as of 09:35 UTC on September 29), on crypto exchange Coinbase, $MATIC is trading around $1.0826.

Disclaimer

The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.

Image Credit

Image by “Tama66” via Pixabay





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