Are you interested in investing in cryptocurrencies, as are many other people globally? Then chances are, you’ve probably looked into Bitcoin. However, at over $20,000 per coin, it’s just not feasible for you to get in on the action.
Luckily, there are other more affordable cryptocurrencies to invest in. For example, there’s Ethereum, which comes in at around $1,500 per coin.
Want to go even lower, but stay on the Ethereum blockchain network and infrastructure? Then consider Polygon.
We’ll give you a comprehensive guide on this crypto so you can see if it’s the right one for you.
What Is Polygon?
Polygon was first Matic Network when it was first launched in 2017. It was created by four software engineers in Mumbai.
It wasn’t until 2021 that the company changed names to Polygon Technology. Later that year, it acquired the Mir blockchain network.
You might’ve heard about Polygon in the news in December 2022. This was when Donal Trump got into NFTs on the Polygon network. Each NFT went for $99.
The network itself is an Ethereum-compatible blockchain network. It aims to provide both fast and low-cost transactions to its users. This makes it a layer 2 scaling solution for Ethereum.
Developers are able to build and run decentralized applications (dApps). These allow for user privacy and no censorship, which makes these apps extremely appealing to some.
What Is MATIC?
MATIC is the Polygon network’s own cryptocurrency. You might wonder, “how much can I make staking MATIC,” but it’s best if you learn more about the Polygon network first. That way, you won’t make costly mistakes.
MATIC is considered a gas token. Gas tokens are used to pay transaction fees on blockchain networks.
This crypto is used for smart contracts on the Polygon network. These are self-executing computer programs that you can find on a blockchain network. They automatically go through when certain conditions and rules are met, which makes things very convenient.
What’s cool is if you invest in these coins, you can also be part of the governance decisions. This means you can help decide the future of this crypto’s network.
How Does Polygon Work?
Earlier, we said that Polygone is a layer 2 scaling solution for Ethereum. Essentially, it takes an already-established blockchain network and improves it. Mainly, it addresses two things: scalability and performance limitations.
Because Polygon is compatible with Ethereum, it can use the existing infrastructure and security features. That way, developers don’t have to start from scratch. In fact, they can build and deploy their dApps quickly this way.
In addition, there’s a modified version of the Ethereum consensus mechanism. As a result, there are faster block times, and more importantly, lower transaction fees.
To improve scalability, Polygon utilizes sidechains. The transactions are distributed between them, so there’s greater parallelism.
Perhaps one of the best achievements of the Polygon network is that it has interoperability. You can create complex dApps that span multiple networks, so long as they’re all Ethereum-compatible.
One of the most notable differences between Polygon and other well-known cryptos is that it uses a proof-of-stake (PoS) system. Its transactions are validated through investors holding their assets. They’re then rewarded with part of the unlocked blocks.
Cryptos like Bitcoin use proof-of-work (PoW) systems, which validate transactions with complex calculations. This means you can’t stake these cryptos.
How Can You Use the Polygon Network?
What’s fantastic about the Polygon network is that it’s pretty much the same thing as the main Ethereum network, but better. It also allows you to diversify your portfolio if you already have other investments, whether it’s in Ethereum, other cryptos, or stocks.
Here’s how you can use the Polygon network to your advantage.
Use a Trustworthy Exchange
Cryptocurrency exchanges are platforms you use to buy and sell your cryptos. You’ll have to search carefully; not only does the one you choose need to support Polygon, but it needs to be reliable and trustworthy too.
On the bright side, it’s easy to Google reviews and see what people have to say. Go with an exchange that has fast transaction times, as well as excellent security. An exceptional customer service department is good too. If you ever run into issues, you want them resolved quickly.
Sign up for an Account
To sign up for an account on a crypto exchange, you’ll need your full name, addresses (both email and physical), phone number, and payment information. To remain compliant with laws, many will also require you to provide a government-issued ID to prove your identity.
Once you’ve signed up, you can then add funds to your account. While you can do so in traditional ways (such as bank transfer or credit card), you can also transfer your other cryptos.
Buy MATIC Coins
When your exchange account has funds, you can buy MATIC coins. There are two ways: a market or limit order.
Market orders allow you to immediately buy MATIC, while limit orders wait until the value hits the price you set it at.
Store Your MATIC Coins in a Wallet
Cryptocurrency exchanges conveniently let you store your assets on their servers. However, it’s highly recommended that you transfer them to a crypto wallet instead.
Exchanges are prone to shutting down due to government actions. Hackers also target them often. In both cases, you’d lose everything you have.
Whether you choose hardware or software, cold or hot, a crypto wallet is a must.
Make an Investment in Polygon
Now you know what the Polygon network is, what its native cryptocurrency is (MATIC), and how you can use this entire system.
As you can see, it’s an innovative way to invest your money, as you’ll use PoS systems instead of PoW ones. It’s a more energy-efficient process, so if you’re into eco-friendly investing, then this is the ideal path for you.
Don’t wait any longer; it’s time for you to make an investment in Polygon with this newfound information. You’ll get a slice of the crypto pie and possibly make big profits in the future!
