Binance Research covered $MATIC on 4/1/19 and then updated the page on 4/1/21.
Link: https://research.binance.com/en/projects/matic-network.

 

1. What is Matic Network (MATIC)?

Matic Network is a layer-2 scaling platform that enables fast, easy, and secure off-chain transactions for not only payment transactions, but also generalized off-chain smart contracts.

Ticker MATIC
Issuing Price $0.00263 USD
Initial Circ. Supply 3,230,085,551 (~32.30% of Total Supply)
Total Supply 10,000,000,000 MATIC
Project Website https://polygon.technology/

Some of its key features include:

  • Scalability: fast, low-cost and secure transactions on Matic sidechains with finality achieved on mainchain and Ethereum as the first compatible Layer 1 basechain
  • High throughput: achieved up to 7,000 TPS on a single sidechain on internal testnet; Multiple chains to be added for horizontal scaling
  • User experience: smooth UX and developer abstraction from mainchain to Matic chain; native mobile apps and SDK with WalletConnect support
  • Security: Matic chain operators are themselves stakers in the PoS system
  • Public sidechains: Matic sidechains are public in nature (vs. individual dApp chains), permissionless and capable of supporting multiple protocols

Matic’s mission is to create a plasma-influenced Layer 2 scaling solution to “enable throughput capable of meeting the transaction demand for mass adoption of dApps”.

Matic is unique both in terms of its technical approach towards Layer 2 as well as its potential support for variety of use cases.

  • Matic Layer 2 is an account-based variant of MoreVP (More Viable Plasma). The Plasma framework is used to guarantee the security of assets on the main chain (such as ERC-20 and ERC-721 tokens for Ethereum), while generic transactions are secured by a Proof-of-Stake network, built on top of Tendermint. Matic sidechains are essentially EVM-enabled chains and are conducive to ready deployment of solidity smart contracts, essentially making it an easy tool for Ethereum Developers to use it for scaling their dApps/Protocols.
  • Commercially, Matic sidechains are structurally effective for supporting many Decentralized Finance (DeFi) protocols available in the Ethereum ecosystem.
  • Matic’s core philosophy is to enable dApps to compete with the user experience that is offered by centralized apps today.
  • Ethereum is the first basechain Matic Network supports, but Matic intends to offer support for additional basechains, based on community suggestions and consensus, to enable an interoperable decentralized Layer 2 blockchain platform.

Within the Matic Network, the MATIC token has three key use cases:

  • Participating in the Proof of Stake consensus: Matic sidechains enforce consensus using a Proof-of-Stake (PoS) layer in which network participants stake Matic tokens to participate as validators.
  • Paying for the transaction fees in the network: The transaction fees on Matic sidechains are paid in MATIC tokens. The more users onboard to use the apps on Matic Network, the more the transaction volume and hence the transaction fees. The Matic token is also used to pay staking rewards to the POS stakers
  • Having taken inspiration from Livepeer and its “protocol funding the ecosystem” model, Matic intends to enable a separate staking mechanism for supporting the ecosystem projects. This will help create a fund out of the “block rewards” that can help support developers working on features and dApps needed by the network to get a part of block rewards. This mechanism is funded by reserving a percentage of the transaction fees in-protocol to support the projects building for enhancing Matic Ecosystem.

2. Key products and features

One of Matic’s ecosystem products, Dagger, is a Zapier integration that allows any builder to gather real time ethereum updates to plug into their spreadsheets, apps, or other products. Today, more than 400 dApps and trackers are built using this trigger tool.

product1

To ensure smooth asset transition to sidechains and easy asset management for users, Matic will be releasing its own wallet with a WalletConnect integration.

Expected DAU

Several dApps are actively being developed on Matic to provide a better user experience with lower transaction costs:

  • Decentraland:
    • Full data
    • Confirmed DAU: 79
    • Current Daily Transactions : 402
    • Expected DAU with Matic Marketplace with low txn fee and better user experience games should be much higher. May be a 100 times higher than this as it is expected to compete the user experience of centralized games and apps
  • Cryptostaw – Venmo using DAI:
  • Pocket full of Quarters – Game that raised funds on Republic.co
  • Chainbreakers – Game built on Decentraland Universe

Fee Abstraction

Below is a flow chart to understand the fees abstraction mechanism to be implemented on Matic sidechains.

fee

Source: Matic Network Management Team

The dApps will use their native dApp tokens on the Matic chain for in-app transactions while also using them to pay network fees to consensus enablers in MATIC.

As shown in the flowchart above, the dApps operating on Matic chains will help maintain a reserve of Matic Tokens with the liquidity providers, this will ensure that their customers can transact freely without having to worry about holding Matic Tokens in their own wallets.

Blockchain and network data

Matic Network has validators who will stake their assets for the right to participate in the PoS consensus mechanism on the sidechains.

The transaction fees will be determined by the users on the network as they do on Ethereum, but given the high transaction throughput that is possible, the transaction fees are expected to be significantly lower than those of Ethereum due to supply and demand of “gas fee” markets.

network

The blue boxes in the diagram above represents the sidechain and the human icons show the staking layer. Multiple sidechains can be added below this staking layer, with more blue colored sidechains attached below the staking layer.

Block Producers Validators (Checkpointers)
# of Slots ~7-10 ~100-120
Stage Involved Blocks produced on Side Chain Checkpoints pushed to main chain
Block Period Need to produce ~1-second blocks Need to push block hashes from block producers to the ETH mainchain every ~5 minutes (256 blocks)
Risk/Resources needed – Higher uptime requirement as downtime is severely punished – Need higher end hardware and ancillary services to prevent DOS attacks – Relatively lower uptime required as penalties for missing signing is relatively not that severe – Cost of checkpoint submission goes up with ETH price increase
Nodes to maintain Plasma VM Tendermint + Plasma VM
Throughput Upto 2^16 TPS Achieved 6000-10000 in the testnet 1 checkpoint per ~5 minutes

3. Economics and supply

3.1 Key metrics (as of April 1st 2019)

Token Name MATIC
Token Type ERC-20 (as of TGE)
Total Private Sale Allocation 3.80%
Seed Allocation 2.09%
Seed Sale Token Price $0.00079USD / MATIC
Early Supporters Allocation 1.71%
Early Supporters Token Price $0.0026USD / MATIC
Launchpad Sale Allocation 19%
Launchpad Sale Price $0.00263 USD / MATIC
Launchpad Sale Date April 2019
Amount Raised Public Sale $5.00 MM

3.2 Token supply distribution

  • Private Sale tokens comprise 3.80% of the total supply:
    • Seed Round: Sale conducted at a rate of 1 MATIC = 0.00079 USD and raised a total of USD 165,000, selling 2.09% of total token supply
    • Early Supporters: sale conducted at a rate of 1 MATIC = 0.00263 USD and raised a total of USD 450,000, selling 1.71% of the total token supply.
  • Launchpad sale tokens comprise 19% of total supply. It was conducted in April 2019 for a total raise of ~$5,000,000 USD worth of BNB at ~$0.00263 per token for 19% of the total token supply. The BNB to MATIC rate will be determined on the day of the sale.
  • Team tokens comprise 16% of the total supply.
  • Advisors tokens comprise 4% of the total supply.
  • Network Operations tokens comprise 12% of the total supply.
  • Foundation tokens comprise 21.86% of the total supply.
  • Ecosystem tokens comprise 23.33% of the total supply.

###### MATIC token supply distribution

 

3.3 Token governance and use of funds

As of February 26th 2019, Matic Network has used approximately 7% of TGE funds according to the allocations below:

  • 1% Partnerships.
  • 9% Marketing.
  • 15% Legal.
  • 75% Technical Development.

As per their risk management strategy, Matic plans to perpetually hold sufficient fiat reserves to fund their operational costs for at least 12 months. The rest of any funds held in crypto will be stored in cold wallets with multisig support.

3.4 MATIC token release schedule

The following chart represents the number and breakdown of all MATIC tokens that are intended to be released into circulation on a monthly basis.

MATIC release schedule (%)

 

4. Roadmap, updates, and business development

4.1 Communicated vs. completed milestones

PLANNED DATE MILESTONE ACTUAL DATE TIMING COMMENTS
2018: Q3 Matic testnet released to developers (closed alpha)
Plasma MVP contracts on testnet Full ERC-20 support for fast and cheap transfers Plasma exits tokenized for fast exits
2018: Q3 On Time Matic Network Github
2018: Q3 Dagger (real-time Ethereum events notifications engine) released Dagger integration with Zapier (ERC-20 transfers) 2018: Q3 On Time Matic Network Github Dagger Ethereum Integration
2018: Q4 Matic.js Javascript SDK released for testnet Matic mobile app (with Plasma support) 2018: Q4 On Time Matic Network Github Matic wallet is in private repo currently
2018: Q4 Quarters (games platform integrated with Matic testnet)
WalletConnect support on mobile app (Ethereum & Matic testnet)
2018: Q4 On Time Quarters Wallet
2019: Q1 ERC-721 support on Matic testnet PoS implementation for Staker nodes for sidechain – internal release Matic testnet v2 released to developers (closed beta) Asset swaps PoC on Matic testnet (for Decentraland marketplace) Tokenized staker slots for PoS implementation 2019: Q1 On Time PoS implementation in private repo Matic Network Github Asset swaps in private repo
2019: Q1 Dagger integration with Zapier (generic contract events)
Cryptostaw (Burner wallet) integrated with Matic testnet
Hermione (realtime, scalable Ethereum data processor) – internal release
2019: Q1 On Time Zapier Cryptostaw Hermione in private repo

By Q1 2019, some of the projects built on top of Matic included:

  • A Burner wallet (i.e., a friction-free mechanism to move tokens quickly through a web browser interface and withdraw out to cold storage when complete) implementation for onboarding users to dApps with one-use wallets.
  • An upcoming games platform.
  • A marketplace for NFT assets.
  • A VR game.
  • An advertisement exchange.
  • Others (still in development).

4.2 Updated roadmap

Q2 2019

  • Matic Network Mainnet release (alpha)
  • Allow Deposits and withdrawals of Ethereum-based assets using the Matic Plasma implementation in alpha
  • Plasma – Cross-asset swaps between ERC721-ERC20, ERC20-ERC20, ERC721-ERC721) on testnet
  • Proof-of-Stake Validator onboarding
  • dApps developer program
  • Matic Wallet – WalletConnect for dApps (Ethereum & Matic Network transactions)

Q3 2019

  • Matic Network Mainnet release (beta)
  • Plasma – Asset swaps (ERC721-ERC20, ERC20-ERC20, ERC721-ERC721) support on mainnet
  • Generic smart contract support (with PoS guarantees)
  • Plasma Fast exits implementation on testnet
  • Plasma Watcher nodes

Q4 2019 & Q1 2020

  • Matic Network Mainnet release
  • Plasma Fast exit services on mainnet
  • Transaction relay pool (perform transactions without ETH) – for enabling easy asset/state movement from Ethereum to Matic
  • Generic smart-contract support (with Plasma guarantees) – Proof-of-Concept
  • Plasma – NFT Marketplace platform release for Ethereum assets

4.3 Commercial partnership and business development progress

Matic has already partnered with several blockchain projects, including the following:

  • Decentraland: Decentraland is a virtual reality platform powered by the Ethereum blockchain. Users can create, experience, and monetize content and applications using a developer toolkit that works on any platform (all VR headsets and web browsers) and is designed to create virtual environments and applications. Matic is collaborating with Decentraland to scale the transactions that will occur as a result of user interactions within the virtual universe. This will include payments, NFT sales and eventually general game states and other data.
  • Quarkchain: QuarkChain is an innovative permissionless blockchain architecture that aims to provide a secure, decentralized, and scalable blockchain solution. Matic Network and Quarkchain intend to collaborate on L2 scaling research by exploring and developing Plasma sidechain solutions on top of Quarkchain. Matic will also be working with Quarkchain to build notification services like Dagger and Mobile Wallet capabilities for Quarkchain.
  • Ankr Network: Ankr is a distributed computing platform that aims to leverage idle computing resources in data centers and edge devices. Matic will collaborate with Ankr to explore building a decentralized Web3 stack in which Ankr can provide Distributed Cloud Computing services for Decentralized Application Development on the Matic Network.
  • Portis: Portis is a technology company that wants to make sure any person in the world can use decentralized applications, just as easily as they use “regular” apps. Matic is working with Portis to help these dApps using Portis achieve scalability and an enhanced user experience.
  • MakerDAO: Maker is the organization behind the DAI stablecoin. Matic Network is partnering with MakerDAO to explore and jointly support teams for the development of dApps which use DAI on Matic Network sidechains. Matic Network intends to integrate DAI as the first ERC-20 token on Matic sidechains.
  • Ripio Credit Network: Ripio Credit Network is a peer-to-peer credit network that connects lenders and borrowers located anywhere in the world. Matic is working with Ripio to enable micro loans on its Plasma sidechains. Matic, along with RCN, is also researching faster Plasma exits where exit NFT’s will be used as collateral for loans on the RCN platform.

5. Project team

The Matic team has 12 total employees, with 3 technical co-founders, 6 additional developers, two marketing specialists, and a product manager.

Jaynti Kanani
CEO
Core contributor for the first Plasma MVP implementation. Wrote the first Node implementation of the original Walletconnect protocol. Contributed to Web3 and developer ecosystem tools like sol-trace. Previously Data Scientist with Housing.com
Sandeep Nailwal
Co-Founder
Ex-CTO (Ecommerce) of Welspun Group. Previously ran a Blockchain services & product firm working with various clients to design and implement their Decentralized app architectures. An ex-Deloitte Technology consultant and comes from a top B-School in India.
Anurag Arjun
Co-Founder
Previously AVP (Product Management) with IRIS Business, a leader in software products for Regulatory bodies across the globe. He is also a serial entrepreneur and has had an exit with his previous firm named Dexter Consultancy. Previous at Cognizant Technologies and SNL Financial.
Siddhartha Jain
VP – Operations & Marketing
Previously Project Manager at EXL, and Data Analyst at Mu-Sigma.
Delroy Bosco
Project Manager
Previously Scrum Master, served Business Analyst roles at IRIS Business.
Nirbhik Jangid
Community Manager
Finalist in Google OMC (Ad Grants Challenge) 2016
Bhavir Shah
Head, Engineering
Vaibhav Chellani
Blockchain Engineer
Ashish Rajpurohit
Blockchain Engineer
Sayli Patil
Application Engineer
Arpit Agarwal
Blockchain Engineer
Vishal Gupta
Dev Ops

6. Matic’s activity

6.1 Social and community data

Community strategy overview

Matic’s main community focus has been to attract more and more dApp developers to build on the network. Thus, Matic wants to build a developer community, and tap into the immense potential of developers who have yet to dive into crypto. To achieve this, Matic is collaborating with top universities in India and the rest of the world to ensure that budding developers are aware and use Matic as a platform to scale their dApps.

Matic’s primary geographical focuses are detailed as below:

  • India – Matic has sponsored, mentored, and judged several hackathons in India such as ETHIndia, and also organized a DApp training course in India’s leading engineering institution IIT Bombay that introduced 80 developers to building and maintaining decentralized applications. The team has continued to support and provide guidance to some of the projects from this cohort. Matic has also addressed students at blockchain events at institutions such as IT Mumbai, IIT Roorkee, and NIT Surat. Matic team was also a sponsor and part of the judges panel at ETHIndia that was held in Bangalore and at ETHSIngapore
  • US & China – Given these geographies are centres of the blockchain development, they are strategically important to Matic as a significant percentage of current blockchain developers are based out of these areas. Matic plans to have developer outreach hubs based out of SF and Hong Kong along with working spaces to spur innovation and development on the Matic platform.
  • Japan – Matic is fairly connected with the Plasma research community in Japan and is also working to raise awareness in the local community. Matic intends to build a sizeable developer base in Japan specifically related to enterprise use cases.
  • Germany –Chainbreakers is a German team developing an RPG game on Decentraland. They have announced that they will be using Matic Network for their scalability needs. Matic plans to hire from the vibrant blockchain development community based out of Berlin and also are exploring the feasibility of having a development center in Berlin.
  • United Kingdom – Matic is collaborating with a decentralized exchange from the UK to help them explore moving to Matic sidechains to boost trade processing speeds and increase user adoption.
  • Korea – Matic did an interview with KoreaCryptoSocial during a blockchain event in Seoul, but the team will add additional resources devoted to the Korean market after its Launchpad sale.
  • Vietnam – Matic has started a local telegram group to engage the Vietnam community, organize developer meetups, and establish university connections.
  • Thailand – Matic has a Thailand community group and plans to identify the universities and developer hotspots to collaborate with to spur blockchain development.

Social media channels

Twitter
Medium
Official Announcement Channel
Telegram – Matic Network Official Community

6.2 Development activity

Github

ContributionsStarsOpen IssuesSizeForksNov 2020Dec 2020Jan 2021Feb 2021Mar 2021Apr 202116k18k20k22k
7-Day Change

Contributions

+0.10%

Stars

+3.23%

Open Issues

+3.77%

Size

+0.04%

Forks

+1.58%

 

Matic has a total of 13 public and 17 private repos. Indeed, Matic has only released a portion of their code publicly at this stage of development. The contracts repo contains the main business logic of the Matic Network. However, private repos’ metrics and overviews are the most informative in learning about the Matic project and ecosystem.

Top public GitHub repositories

Commit Activity

+11,358

 


Last Commit

2 hours ago

Stars

745

Languages

TypeScript
JavaScript
Go
CSS
Solidity
Vue
Shell
Elixir
Java
Swift

Top private GitHub repositories

A large portion of Matic’s development across the core technology and product suite occurs in their private repos.

heimdall

Validator node for Matic PoS layer

3 Contributors618 commits

wallet-app

Mobile app in React Native (Android & iOS support) with wallet, Plasma interactions and WalletConnect integration

7 Contributors997 commits

dagger-service

Realtime blocks, transactions, logs and events push notifications for Ethereum blockchain

2 Contributors47 commits

6.3 On-chain activity

Number of Transactions

Number Of TransactionsNov 2020Dec 2020Jan 2021Feb 2021Mar 2021Apr 20210 txs5k txs10k txs15k txs

7-Day Average

5.52k txs

7-Day High

13k txsApr 26 2021

7-Day Low

3.47k txsApr 20 2021

Number of Large Transactions

Number Of Large TransactionsNov ’20Dec ’20Jan ’21Feb ’21Mar ’21Apr ‘210 txs250 txs500 txs750 txs1k txs1.25k txs

Last 24h

449 txs

7-Day High

449 txsApr 26 2021

7-Day Low

82 txsApr 24 2021

7. Appendix

Advisors