As the Ethereum blockchain has grown in popularity, the need for scaling solutions has risen simultaneously. That is exactly what Polygon does, and this time, it raised $450 million in fresh funding.
The round was led by Sequoia Capital and included participation from over 40 major VC firms, including Tiger Global, Elevation Capital, Accel Partners, and Steadview Capital, as well as SoftBank’s Vision Fund II, Galaxy Digital, Maker’s Fund, Republic Capital, and others. The funds were raised through a private sale of Polygon’s Matic token. One token was sold for about $2, and Polygon’s market cap has reached about $13 billion.
The proceeds from the funding round will be utilized towards cementing its position as the leader in the race for scaling Ethereum.
Founded by Jayant Kanani, Sandeep Nailwal, and Anurag Arjun in late 2017, Polygon is building scaling solutions such as Polygon PoS, Polygon Edge, and Polygon Avail, and provides a framework for building decentralized apps off-chain that have fortified security, scalability, and speed. In fact, over 7000 decentralized apps are currently building on Polygon.
Today, it has over 130 million unique addresses and more than 2.67 million monthly active users, who generate nearly 3 million transactions per day. Polygon POS has recorded over a billion transactions last year. It has also spent $1 billion in recent quarters to make acquisitions.
In a press statement, the company said, “With this warchest, the core team can secure Polygon’s lead in paving the way for mass adoption of Web3 applications, a race that we believe will result in Ethereum prevailing over alternative blockchains. The funds will also allow Polygon to continue investing in cutting-edge zero knowledge (ZK) technology that will be key to onboarding the next billion users to Web3.”
It also aims to solve some of the fundamental issues on the Ethereum blockchain like the network’s capacity to handle more transactions, congestion due to decentralized finance (Defi) and non-fungible tokens (NFTs), and rising fees. This can be made possible to move transaction information off the blockchain, something that will allow Polygon to pack more transaction details on an Ethereum block and increase the number of transactions it can process.
If that is not enough, Polygon is also making investments ($1 billion as of now) in zero-knowledge (ZK) technology to onboard the next billion users to Ethereum. As of January 20, it has processed over 23 million blocks and 1.3 billion transactions.
Polygon is also building a complete suite of solutions that is similar to what Amazon Web Services offers Web2 developers — a tool for every possible use case and scaling at a click of a button. For Web3, Polygon PoS already offers an execution layer with low fees and high transaction throughput secured by the Ethereum mainnet. With Polygon Edge, projects are building custom blockchains from scratch. In the near future, Polygon Avail will deliver the general-purpose, scalable data availability piece of the puzzle and ZK solutions will make network congestion a thing of the past first and then tackle applications around privacy.