Last week, Polygon ($MATIC) Co-Founder Mihailo Bjelic talked about the crypto space in general and Polygon in particular during an interview he had in Davos (Switzerland).
What is Polygon?
On 18 May 2021, Anthony Sassano, 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.“
Furthermore, Sassano 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 commented on 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.”
Mihailo Bjelic’s Trip to Davos
On May 24, Bjelic, who was in Davos to attend this year’s World Economic Forum (WEF) Annual Meeting, had a fireside chat with CNBC senior technology correspondent Arjun Kharpal.
Here is what he had to say about the recent crypto market cash, which was partly due to macro factors (such as high rates of inflation and the tightening of monetary policy by the world’s major central banks) and partly due to the Terra debacle:
“Everyone is talking about crypto. Crypto us the hot topic now, and we believe with reason, of course. Many funds from Andressen Horowitz medicine to other industry and technology leaders are recognising crypto and blockchain is the bleeding or the most important, most transformative technology probably besides artificial intelligence at this point of time in the world…
“What we’re seeing on the market side or on the prices side, it’s not necessarily correlated with what is actually happening in the in the technology sector when it comes to technology development adoption…
“Previously, we have seen a lot of hype when it comes to prices. Some valuations probably got overblown a little bit, and I think this is normal and in economy you always have these cycles and ups and downs, bull markets,and bear markets. And what we have seen with the collapse of Terra is probably or might be the Minsky Moment for this cycle of crypto. And it is how it is…
“These cycles are probably normal for better or worse, and at Polygon, we are kind of not paying attention to the prices and to these cycles. We are laser-focused on what we do, on technology, how it is changing the people’s lives, how we onboard more projects, more users.
“We are more strong than ever and industry in general, including Polygon. We are super super bullish when it comes to technology and adoption and long-term perspectives. But what we have seen with prices, it’s not necessarily correlated. We have seen the unfortunate incident with Terra and now this downturn in prices coupled with the uncertainty on the macro level that we are all seeing.
“Might be some tough times ahead of us, and what is the most important really for us is we hope that there will be mechanisms for retail investors to become protected. That is what we generally are most concerned about.“
As for how well Polygon is doing, on Sunday (May 29), on Sunday (May 29), Bjelic tweeted that all kinds of enterprises are considering using Polygon.
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.