What is Polygon (MATIC)? Learn More About MATIC Crypto
What is Polygon crypto, also known as MATIC? What chain is it based on? And what are the actual use cases of the Polygon crypto?
As we move slowly into a more mature era of cryptocurrency, and hence blockchain technology as a whole, it becomes easier to understand the differences between the many cryptocurrencies.
We will cover these topics (and more) in this article, giving you a better understanding of Polygon and MATIC. We will also cover if and how you can trade the Polygon crypto at Admirals.
Table of Contents
- What is Polygon MATIC Crypto? How Does It Work?
- What’s the Difference Between Polygon and MATIC?
- What is Polygon Crypto (MATIC) Used for?
- Advantages and Disadvantages of the Polygon Crypto (MATIC)
- Is the Polygon MATIC Crypto a Good Investment?
- How Much Could Polygon MATIC be Worth?
- Can You Trade Polygon (MATIC) at Admirals?
- What is Polygon Crypto? Conclusion
What is Polygon MATIC Crypto? How Does It Work?
The Polygon Network, formally known as the Matic Network, is a secondary scaling solution based on the well-known and popular Ethereum Network.
To put it in simplest terms, the Polygon Network solution operates in conjunction with, or on top of, an existing blockchain network (opposed to operating as a proprietary chain) - In this case, as mentioned, on Ethereum.
It is also known in blockchain industry terms as a ‘layer 2 solution’.
Depending on your extensiveness of knowledge within the crypto space, you may be well aware that Ethereum's transactions have become not only slow but expensive.
While Ethereum has a great reputation and is considered the second-largest cryptocurrency by market cap, the speed and cost of the network, especially in peak transaction times, poses many challenges for the crypto’s future.
So, where does the Polygon crypto fit into all of this?
The Polygon Network is an ideal solution for not only Ethereum but for the crypto community as a whole.
Considering Polygon is a scaling solution, having this kind of overlay network on the Ethereum blockchain makes the payments made both cheaper and faster; the Polygon Network assists in processing part of these transactions, lessening the congestion which would exist otherwise.
And how does Polygon assist in the processing and hence scalability of these transactions?
Polygon processes these batches of transactions on their own proprietary proof-of-stake blockchain.
What’s the Difference Between Polygon and MATIC?
This is an important but simple query to cover while we cover more details on what is Polygon crypto.
Simply put, the Matic Network (launched in 2017) rebranded in 2021, changing to the name ‘Polygon Network’.
However, the original ticker, MATIC, did not change during the rebrand – also maintaining its original utility and use case.
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What is Polygon Crypto (MATIC) Used for?
As we have covered the most important question of, what is the Polygon crypto, a brief history, how it works and why it’s important, let’s go further in defining what Polygon MATIC is used for.
Given that Polygon is a layer 2 scalability network solution to Ethereum, the network’s token known as MATIC is an ERC-20 token (the technical standard name for Ethereum’s smart contract token).
Let’s review some of the use-cases of MATIC, below:
- Proprietary Platform Currency; MATIC tokens run the entirety of the Polygon platform, including paying the ongoing transaction fees.
- Staking; Earn percentage-based rewards by staking, or holding, the Polygon crypto on the network, with the option to Validate or approve transactions.
- DeFi Protocols; Integrate and utilize various DeFi projects using both the Polygon Network and MATIC.
- Purchase NFTs and Digital Assets; MATIC can be used in conjunction with a Web 3.0 Wallet (like MetaMask) to purchase NFTs and digital assets based on its ERC-20 token function.
While the above use-cases are quite broad in their reaches, these capabilities only scratch the surface in regards to the future potential of the Polygon crypto, or MATIC.
Given the relatively young age of the Polygon Network, and Web 3.0 as a whole, it is fair to assume that the year 2022 will see much more traction in this area.
Advantages and Disadvantages of the Polygon Crypto (MATIC)
Various cryptocurrencies on the market come with their advantages and disadvantages. The Polygon crypto (MATIC) is no different. These basis points can affect how you trade on the market, so we will highlight some of these below:
Advantages of the Polygon Crypto:
- Very low transaction fees (typical fee around $0.01)
- Fast transaction speed (average processing fee around 2.1 seconds)
Disadvantages of the Polygon Crypto:
- Not a proprietary blockchain (since it is a layer 2 on top of the Ethereum blockchain)
- Not used for everyday purchases (main use case is to be used within the Polygon network and its direct transactions)
Is the Polygon MATIC Crypto a Good Investment?
Depending on how much exposure you want to have to the cryptocurrency market will define if you consider the Polygon crypto (MATIC) to be a good investment or not.
As with any trade or investment, you want to first ensure that you understand how an instrument or currency works – which is the aim of this article.
What is to come in the year 2022 for the Polygon crypto (MATIC)? We summarize some upcoming points which can help you decide if you consider Polygon to be a good investment in 2022:
- As of January 2022, the new Chief Executive Officer (CEO) of the Polygon Network is Ryan Watts (former Head of Gaming at YouTube). This is a promising step forward for the success of Polygon.
- The price prediction for Polygon is generally positive for 2022, with a forecast of $4.75 by the end of the year.
- A main potential downfall for the Polygon crypto is increased competition in 2022, with the possibility of more scaling solutions coming onto the market.
How Much Could Polygon MATIC be Worth?
As with any currency or instrument, there is no sure way of knowing what it may be worth in the future, but you can always make a prediction based on both fundamental and technical analysis.
With data from Changelly on March 3, 2022, Changelly being a reputable cryptocurrency exchange, the following price predictions have been made, from the year 2022 until 2025. See the table below:
|Year||Polygon Price Prediction|
Naturally, there is no certainty that these prices can or will be reached, which is why it is always important to monitor your trades on an ongoing basis. Please be sure to always trade responsibly and use a risk management strategy.
Can You Trade Polygon (MATIC) at Admirals?
As you may be aware, Admirals offers over 30+ cryptocurrency CFDs to trade using our innovative Trade.MT5 platform.
Currently, you can trade the Polygon crypto or MATIC CFD against the US Dollar using our Trade.MT5 platform.
You have the option to trade the MATIC CFD with no commission applied, a minimum/typical spread of 3%, and a minimum margin of 0.5.
See the chart example, below, taken directly from the Admirals Trade.MT5 Web Trader; this chart gives some insight on the performance from late 2021 up until now, March 2022.
MTCUSD Daily chart taken from Admirals Trade.MT5, captured on March 8, 2022. MACD indicator with EMA of 12 and 26, SMA of 9 (Daily Timeframes). Performance dates from 24 November, 2021, until 8 March, 2022. Past performance is not a prediction of future results.
With the above chart image, you can see the red line fluctuating above and below the signal line – showing both Bulling and Bearish trend characteristics in this given timeframe.
Ideally, when analysing the price charts for MATIC, or any instrument in general, it is important to reference various indicators in conjunction with each other, in order to have the clearest overall view possible.
The Moving Average Convergence/Divergence (MACD) is a popular indicator for cryptocurrency trading, as it is both user-friendly and generally provides strong signals, given it is based on trends and suitable for both short- and long-term price momentum.
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What is Polygon Crypto? Conclusion
If you’re reading this article, it is highly likely that you are fascinated by the developing world of cryptocurrency, blockchain, and the many use cases it continues to build on.
Although crypto has been around for a decade or so at this point, it is fair to believe that the year 2022 will bring more developments than what we have seen yet.
As we continue as a globe to move towards a cashless society, increased regulation, and mass adoption to the blockchain, only time will tell how the markets respond to such.
The Polygon crypto (MATIC), along with the many other cryptocurrencies, will most likely take a part in the financial future of most individuals, to come.
If you’re yet to register with Admirals in order to take part in live trading, you can do so by clicking the banner below:
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