When we were starting imagining our V.2 in September, it was the peak of the first DeFi season. Prices were rising and enthusiasm was peaking. But under the ebullient surface, a storm was brewing.
Gas prices had spiked to levels not seen since 2017 and the famous CryptoKitties launch. Smaller players, unable to afford the expensive transactions, were being pushed to the sidelines as large holders cashed in on all the latest yield farming opportunities.
Mr. Sandeep Nailwal of Polygon (which was called Matic Network at the time) was invited to join on a channel in a Discord server of a decentralized project. He was invited for one specific purpose: to answer rigorous questions about how his project can solve the issue of scalability.
A debate ensued in that channel, as arcane terms like “rollups”, “validators” and “sharding” were tossed around. The server quickly grew to include channels for every scaling solution: Ethereum 2, Avalanche, Cosmos, Flow Blockchain, Polygon/Matic, NEAR, OMG Network, Polkadot, Skale, Solana, Starkware, xDAI, Rollups, and many more.
As quickly as it had started, the conversation died off. October came, and gas fees dropped back to earth. Developers collectively sighed in relief as their average transaction fees returned to under $50, and went back to doing what they do best. After four months, however, the gas fees skyrocket again, bringing the problem back!
WHAT IS POLYGON? (FORMERLY KNOWN AS MATIC NETWORK).
Polygon offers a Layer-2 (L2) scaling solution that achieves scalability by utilizing sidechains for off-chain computation while ensuring asset security using the Plasma framework and a decentralized network of Proof-of-Stake (PoS) validators — although the project plans to become a full-blown L2 aggregator that supports other L2 solutions such as Optimistic Rollups (OR), zkRollups (ZKR), and Validium.
“Polygon is fully compatible with the Ethereum Virtual Machine (EVM), meaning users from Ethereum can easily transfer their assets to Polygon, and developers can deploy existing Solidity contracts without any major changes.”
SEED VENTURE DISCUSSION.
Our original plan was to still launch SEED Venture (a set of smart contract that the Startup needs to have to raise digital money) on Ethereum, but the last two month we face the problem of insane ETH (gas) fees. In some community AMAs (Ask Me Anything) discussions, Sandeep answered many important questions from the community pertaining to security, developer experience, and roadmap. These answers convinced us that Polygon was a perfect fit for SEED Venture platform, so Startups will be able to deploy SEED’s smart contracts on L2 and play their game.
Does It mean Startups need to have senior developers? No! It’s an update of the platform… and both Startups and “decentralized” investors will be thankful!
This decision is just the start of a developing journey! In the next future we aim to allow Startups to choose different so called “second layers”, as well as different blockchains like BSC (Binance Smart Chain), Avalance and so on. New projects are coming up, like Arbitrium and Optimistic: the second one seems to be a very promising one, considering that Uniswap has recently announced the Alpha launch of Uniswap v3 on the Optimistic Ethereum (OΞ) mainnet!
The point is that “layers” or “blockchains” mean community of participants: every choice made by Startups will be a potential strategy of visibility and engagement.
So here are some detailed reasons why we chose Polygon.
EVM-Compatibility.
One of our criteria for picking a viable L2 option is that it must be compatible with the Ethereum Virtual Machine and the contracts that run on it. Most L2 solutions do not fit this criteria. Some solutions have created their own languages, or required rewriting into languages like Rust.
Production readiness.
We aim that SEED Venture will be ready to launch in Autumn. Delaying our launch to wait for a solution like ETH Phase 2 to come fully online would hurt community morale and weaken our momentum.
So at the end, like the majority of crypto projects looking to have the best of both worlds by enjoying Ethereum’s huge network effect, while avoiding the network congestion, we were left with few options.
These options are both viable competitors for the throne of “EVM-compatible sidechain”. Like siblings, they sometimes squabble and bicker, but at the end of the day, they are family and they share the same goal of helping to scale Ethereum. We did some through researches on both protocols, but at the end we decided that Polygon met our needs better.
Interoperability with other projects.
Polygon has a growing list of dApps launched or planning to launch soon. According to statistics, there are currently more than 350 projects in the Polygon ecosystem, of which games, NFT, and DEFI are the leading ones. This includes nearly 200 + DEFI projects, 150 + games and digital collections, and other categories.
Growing Decentralization.
Unlike many projects, Startups’ tokens contain real financial value, distinct from the speculative value of the other tokens. Each tokens will likely be 1:1 convertible with USDT, USDC, DAI and etc.
In order to ensure the security of our players’ funds, our primary consideration when selecting the L2 home for SEED Venture was a sufficient security framework and decentralization of the network.
Polygon has made great strides in terms of gradual decentralization. There are currently over 100 validators staking MATIC (Polygon’s native asset) to secure the network, most of which are run by community projects with significant funds staked. They are daily growing. Validators require a ⅔ majority consensus to validate transactions and create checkpoints on Mainnet.
Polygon uses a dual strategy of Proof-of-Stake at the checkpointing layer and Block Producers at the block producer layer to achieve faster blocktimes. It also ensures a high degree of decentralization by achieving finality on the main chains via the checkpoints and fraud-proof mechanisms.
Growing network effects.
The total volume locked (TVL) on Polygon is growing quickly. As of today, it has already reached $ 9.5B !!! High gas costs are forcing projects on Ethereum to seriously consider migrating to L2, and as Polygon’s network effect grows, the incentive to migrate to Polygon will become ever stronger.
Great Developer Ecosystem.
Polygon’s mechanism for bridging is extremely flexible. More and more developer tools such as Chainlink are also launching on Polygon, giving existing Ethereum developers powerful building blocks in the new gasless environment.
CONCLUSION.
We think that Startups, Investors, and our Community will be satisfied with our decision to start launching on Polygon and is eagerly awaiting for the ecosystem to go live! The new user experience will be different from SEED V.1 and more user-friendly.
With the adoption of a L2 users will barely notice the transition due to the familiar experience: the process of bridging tokens from Ethereum to Polygon will be intuitive and user-friendly as much as we can. So there will be just one noticeable difference that will truly catch the eye: the transactions will be virtually free and much faster!
By using Polygon SEED Venture will enter in a larger community that will boost the project in terms of challenges, helping It to become international player.
Looking back to the past, SEED Venture was born with the aim to embrace a lot of challenges: since inception, we also looked at projects/protocols on top of the king of the blockchains: Bitcoin.
So we started to keep trace of RGB protocol project in 2018, and today we are also following pretty closely the Mintlayer sidechain! Both projects have strong teams, we personally know some people.
If some conditions will be reached, maybe one day we will land on the king of blokchains!
Stay tuned guys!
Blog Link: www.seedventure.io/Post/the-reasons-why-seed-venture-allow-startups-fundraising-to-run-on-polygon-avoiding-pretty-insane-eth-fees
