- Polkadot is a layer Layer 0 protocol while Polygon is a layer 2 built alongside Ethereum
- Polkadot allows for multiple chains to be built alongside it
- Polygon fixes Ethereums scalability problems
- Both blockchains boast impressive transaction speeds and low fees
Polkadot Vs Polygon
What is Polkadot?
Polkadot is a layer 0 blockchain which allows users to build blockchains, dApps and smart contracts that run alongside the main Polkadot chain which is called the relay chain. These side chains are called relay chains. Polkadot allows the communication between different blockchains making it essential if we are dealing with a multi chain future.
Polkadot was built and designed for its speed, scalability and security.
How Polkadot boasts such fast transactions
Due to Polkadot having the ability to run parachains alongside its relay chain, Polkadot can handle an enormous amount of traffic and transactions. With the ability to spread network traffic across multiple chains Polkadot is able to boast up to transaction speeds of 1,000 transactions per second, compared to Ethereums 30 transactions per second this is quite impressive.
Theoretically as Polkadot becomes bigger and more developers emerge building more parchains Polkadots transaction speeds could potentially reach the millions per second. Polkadot is designed to get faster as the network gets bigger.
Polkadot currently has a handful of parachains such as Kusama, Moonbeam, Moonriver and more. You can check out a full list of the Polkadot ecosystem over at CoinGecko.
Polkadots native token – DOT
Polkadots native token is DOT and is used for stalking and governance votes. As a DOT holder you have a say in future plans for the network in the way of a voting system. Staking your DOT earns you rewards while also helping the network process transactions.
Polkadot uses a Nominated Proof of Stake (NPOS) system which allows for the low transaction fees and fast speeds. This system encourages users to participate as nominators which may back Polkadot up to 16 validators. Both the validator and nominator lock their DOT and receive staking rewards in return.
To read more in depth about Polkadots staking system and how NPOS works read this article here.
Polkadot price chart on CoinGecko
What is Polygon
Unlike Polkadot Polygon is a layer 2 blockchain built to run alongside the popular cryptocurrency Ethereum. Polygon was built to help solve Ethereums scalability problems and high transaction fees. During the height of Ethereums transaction volume some users were experiencing gas fees in the hundreds of dollars, this is where Polygon comes along. While Ethereum is still running the Proof of Work consensus Polygon uses Proof of Stake which allows the network to boast lower transaction fees.
Polygon was founded in 2017 and was originally known as the Matic Network. It was built by experienced Ethereum developers, Jaynti Kanani, Sandeep Nailwal and Anurag Arjun.
Polygon also offers an alternative chain to Ethereum to trade NFTs on, while the Polygon NFT ecosystem hasn’t quiet taken of like Ethereums and Solana it still has a handful of good projects and marketplaces that are worth exploring to take advantage of the low fees and fast transaction times for trading NFTs.
How Polygon works
Polygon uses what are called commit chains which are networks that run alongside the main network, in Polygons case the main network is Ethereum. The commit chains allows transactions to get bundled together and confirm them in bulk before sending them back to the main chain.
This allows Polygon to offer much cheaper transaction fees as transactions are bundled in bulk before being sent through.
Polygon boasts an impressive transaction speed of 72,000 transactions per second, compare this to the layer 1 Ethereums 30 transactions per second and you can see how impressive this scalable layer 2 is.
With Polygon running proof of stake they can offer translation fees as low as $0.0005 but can range up to $0.2 per transaction. This is a vast improvement from Ethereums gas fees which can range from $8 per transaction right up to $100. All transaction fees on Polygon are paid with their native token MATIC.
The one large risk that Polygon faces is Ethereum 2.0. With Polygons sole purpose being the scalability of Ethereum, if ETH 2.0 comes out as does indeed fix the scalability issues then this may cause Polygon to become obsolete. This is of course assuming that Ethereum 2.0 comes out and works as intended. Ethereum 2.0 was recently pushed onto the test net so they are gaining some momentum.
Ethereum 2.0 will be switching Ethereum from a Proof of Work consensus to a Proof of Stake system. This is eradicate the need for miners hence pushing the translation fees down.
Polygons native token MATIC
Polygons native token is MATIC which can be used to pay transaction fees and staking. MATIC is currently the 19th biggest Cryptocurrency by market cap sitting at $4.6 billion. MATIC has a capped total supply at 10 billion tokens with 8 billion of them currently in circulation.
Polygons token MATIC is available on most centralized exchanges such as Binance, Coinbase and Kucoin. MATIC is also available to trade on decentralized exchanges such as Uniswap and Sushiswap. At the time of writing this the MATIC token price is at $0.57.
Is Polkadot Still A Good Investment?
To round things up we can see that both Polkadot and Polygon are impressive blockchains that can scale and give the users a cheap and smooth process.
With Polygon being a side chain of Ethereum it has its benefits helping take the load of Ethereum and giving people a way to participate in the Ethereum ecosystem without having to pay the high gas fees.
Polkadot on the other hand is its own set of chains that allow users to build and scale protocols and dApps by using parachains that run alongside of the main relay chain. This allows for low transaction fees and fast transaction fees.
Both Polkadot and Polygon boast impressive scalability. If Polkadot keeps building and more high quality parchains are built Polkadot has a good chance of being more scalable than Polygon.
With a future that is most likely going to be multi chain, Polkadot will play a big role in connecting and allowing multiple blockchains to communicate.
Interested in other Blockchain comparisons?
As always you should do your own research and decide what to invest in yourself. Both chains have their pros and cons.