A Beginner's Guide to Staking on Polygon
Ethereum

A Beginner's Guide to Staking on Polygon

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2 years ago

Learn how to stake MATIC on Polygon — a leading Ethereum layer-2 scaling solution.

A Beginner's Guide to Staking on Polygon

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Polygon founders are strong believers in the potential of Web 3.0. A decentralized Ethereum scaling platform, Polygon helps developers build scalable and user-friendly decentralized applications (DApps). Moreover, transaction fees are low while still relying on Ethereum's top-notch security. Understanding how all these aspects come in unison and how you can stake to secure transactions on this Ethereum layer-2 scaling solution will be discussed in this article.

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Polygon Scaling Solutions

The scalability solutions of Polygon are multiple and diverse. For instance, it has its EVM-compatible Ethereum sidechain, Polygon proof-of-stake (PoS). A permissionless set of PoS validators secure it. The next solution is Polygon Hermez, which serves as an open-source zero knowledge rollup (ZK-rollup). Leveraging the rollup, one can conduct optimally secure token transfers on the layer-2 chain of Ethereum at a very low cost.
Polygon Edge is another live solution that serves as a modular and extensible framework helping to build private and public Ethereum-compatible blockchain networks. Apart from these three live solutions, Polygon has three in-development solutions: Polygon Avail, Polygon Miden and Polygon Zero.
While Polygon Avail serves as a scalable blockchain for standalone chains and off-chain scaling solutions, Polygon Miden — a STARK-based ZK-rollup — helps bring support for arbitrary smart contracts. Finally, Polygon Zero is also a robustly scalable Ethereum-compatible ZK-rollup that pivots itself on a fast and recursive ETH-friendly proof system.
Polygon did confirm the launch of the much-anticipated Ethereum Improvement Proposal 1559 (EIP-1559) on Jan. 18, 2022. The objective was to introduce the feature of ‘fee-burning’ to Polygon and remove the first-price auction method from the scope of calculating network fees. It is a crucial update in the growth trajectory of Polygon as it works with the vision of making Ethereum accessible for all.

MATIC: The Fuel for the Polygon Ecosystem

MATIC is the native token of Polygon. Its role is vital when it comes to securing the system and enabling efficient governance for the network. It is an ERC-20 token that network participants use for payment services on Polygon and as a settlement currency between operators within the Polygon economy. You also need to have MATIC tokens to pay for transaction fees on Polygon sidechains.

Staking MATIC on Polygon

Staking MATIC helps anyone become a validator in exchange for non-inflationary rewards on the network. One can choose to set up one’s node to become a validator or lease to a community node. Rewards are proportional to the MATIC staked and the transactions on the network.

Where To Buy MATIC?

If you are interested in investing in the Binance and Coinbase-backed Layer 2 solution Polygon, which aims to resolve the scalability issue of blockchains, you can buy some MATIC tokens.

But from where should you buy MATIC? The billion-dollar market cap crypto asset is listed on many cryptocurrency exchanges. It is available almost on all major centralized exchanges like Binance, Coinbase, FTX, Kraken, Huobi, Bitfinex, KuCoin, Bybit, Gemini, Bitstamp, Bithumb, eToro, Crypto.com and HitBTC. The process is relatively straightforward.

Once you have chosen the exchange, you must create an account and complete the know-your-customer (KYC) procedure. The exchange will approve your KYC within 24-48 hours, depending upon the new signups they are seeing. Once you receive an email about KYC approval, it's time to fund your account. You can add funds to your wallet either via bank transfers or credit cards. As soon as you receive funds in your account, enter the amount of MATIC tokens you want to buy, and set the price you want to pay per token. Now, click the "buy" button, and you will have your MATIC tokens in your wallet.

MATIC is also available on popular DEXes like Uniswap and Balancer for advanced users to buy it with wrapped Ethereum (WETH).

Given the congestion and high transaction fees on popular networks like Ethereum, Polygon is a great opportunity to benefit from the booming and exciting world of DeFi and NFTs.

How To Transfer MATIC to Ethereum Wallets Like Metamask?

MetaMask is a popular Ethereum wallet that allows you to engage with decentralized applications (dApps). But for that, you have to fund your MetaMask wallet with tokens such as MATIC. So, how do you do that?

You have to start by logging in to your MetaMask wallet and selecting "Settings" from the drop-down menu option in the top right corner.

Then, scroll down and locate the Networks tab. Further scrolling will get you to the "Add Network" button. Click it.

Here, you have to fill in the following information for the MATIC mainnet to add the MATIC network to your wallet.

Network Name: MATIC Mainnet

New RPC URL: https://polygon-rpc.com/ (for more information on this, visit Polygon here)

ChainID: 137

Currency Symbol: MATIC

Just remember to click on Save after entering the setting. Now, you'll be directly switched to Polygon's Mainnet. You can now close the dialog.

To send your MATIC tokens to the Ethereum wallet, which is the same as sending ERC20 tokens, just transfer the coins to your related MetaMask address.

How To Bridge Ethereum Assets to Polygon?

With the number of blockchains in the cryptocurrency space rising rapidly, sharing data and crypto assets between different networks has become challenging. But to tackle this problem, many projects have built bridges between networks to facilitate asset transfers.

Polygon has introduced a Polygon Bridge, a trustless cross-chain transaction channel to deposit and withdraw assets between different networks.

So, how do you bridge Ethereum assets to Polygon so you can enjoy its fastest speed and cheap fees?

First, you would need a crypto wallet like MetaMask to bridge tokens from Ethereum to Polygon. Then, log in to the Polygon Web Wallet by clicking Polygon Bridge, which will prompt you to connect your crypto wallet.

Connecting your wallet requires you to sign a message. The signature won't cost any fees. But always make sure the website you are using is legit, the same as your wallet.

As you click "Sign" to proceed, you will be redirected to the Polygon Bridge interface, and if not, you can select "Bridge" on the left menu bar.

To send your tokens from Ethereum to Polygon:

  1. Go to the "Deposit" tab.
  2. Once there, click on the token name to choose the token to bridge.
  3. Enter the amount and click "Transfer."

Once you have read the important notes, click "Continue." Now, you'll also see the estimated gas fee and if you are ok with it, click "Continue" to proceed. Review your transaction details before clicking "Continue."

You'll then be prompted to sign and approve the transfer in your MetaMask wallet. Check the details and click "Confirm."

Once confirmed, wait for the tokens to arrive in your Polygon wallet. You can also check on Etherscan to see your transaction status.

How To Stake MATIC?

Now that you own MATIC, you can also put these tokens to use and earn passive income on them by staking.

To start staking, go to the Polygon web wallet, a user-friendly wallet for managing your MATIC tokens which also has an explorer for you to keep track of your transactions and a reward calculator.

Clicking on it will prompt you to connect your wallet like MetaMask. Besides Metamask, Polygon also supports Coinbase Wallet, Bitski Wallet, Venly and WalletConnect. Once the wallet is unlocked, select the account where you store MATIC tokens, and click Next.

Then you have to Connect to the Polygon web wallet and sign the request to allow it to make transactions from your MetaMask wallet. Just click Sign.

Now, you need to select a validator to delegate your tokens. As you choose a validator, you'll get all the information about how much commission you need to pay.

To delegate your tokens:

  1. Enter the amount for staking and just click Continue.
  2. Allow Polygon Wallet to make transactions from your wallet, and in your MetaMask, click Confirm.
  3. Once you have paid the gas fees, confirm the transaction.

That's it! Delegation is complete, and now you will start to receive your staking rewards.

If you want to stake on centralized exchanges like Binance, simply open an account, and fund it with MATIC tokens by buying it on the exchange or transferring it from another wallet or exchange. Click "Staking" under Earn in the Menu and search for MATIC under Locked Staking search. Then, click Stake, enter the amount you wish to stake, and click confirm.

Staking Rewards for MATIC

According to the Polygon website, over 2.75 billion MATIC are currently being staked, and nearly $516 million have been paid in rewards.
The maximum APR for Polygon (MATIC) is about 3.85% on 100 tokens for 365 days, as per the Polygon Rewards calculator. The rates are affected by network volume, age of coins held in the wallet, the number of blocks generated, transaction fees, and other factors.
The validator Witval, which is staking the most amount of MATIC as per Polygon, is offering rewards of 17.7%, while Valis Labs is offering rewards of 19.15% and MyCointainer 18.48%, according to StakingRewards.com. Meanwhile, Matic Foundation, Allnodes, Self Liquidity, SelfMoon, and Decentral Games are all offering 6.75%.
Binance meanwhile offers 21.54% APY for locking your MATIC for 90-days. You can earn 15%-17% on Bitfinex and 10% on KuCoin.

Staking Rewards Calculator

Polygon allocates 12% of its total supply of 10 billion tokens to fund its staking rewards program. To date, Polygon has garnered a global validators base of 100, where more than 14,300 delegators have participated with the total stake reaching a volume of US$4.5 billion. The volume of total rewards distributed has been nearly US$824 million.

The Matic Bridge

The Matic Bridge helps link tokens from Ethereum to Polygon. It is also known as the PoS or Proof-of-Stake bridge. To use this bridge, you need to log in to the Matic Web Wallet and connect to your Ethereum wallet. The suggested way is to use the Metamask extension for Chrome. Among other wallets, Matic holders can stake from their Coinbase wallet, Trust Wallet and Fortmatic wallet through Frontierwallet via their mobile.

Polygon Yield Farming

Polygon farming incentivizes liquidity irrespective of the farm one chooses. All one needs to do is deposit funds in a liquidity pool. It implies that you will be submitting two currencies in one pool at a 50:50 ratio. There are several tools to check the list of farms available on Polygon.

Polygon NFT

Creating and selling NFTs on Polygon is a simple process of many subsequent steps. Powered by NFTically, the Polygon NFT marketplace keeps products catering to multiple categories, including art, virtual worlds, trading cards, collectibles, utility and more.

Curve Polygon Dynamics

Acquiring Matic to pay for transaction fees on Curve Finance is a lucrative proposition as it is very cheap. Users may still need MATIC to pay for gas fees. One can also use the bridge to leverage Ethereum. Once done correctly, it is also possible to bridge USDC/DAI and deposit and swap on the Curve Polygon Website.

PolygonScan

PolygonScan is the main blockchain explorer for the Polygon blockchain. It allows anyone to explore and search the Polygon blockchain for transactions, addresses, tokens, prices, and other activities taking place on Polygon.

Latest Onboardings

Bloxroute, a Blockchain Distribution Network, has been introduced to Polygon. It is a network solution that facilitates web3.0 scalability for blockchain projects. The result is higher throughput and faster transactions.

Star graph, the first Monza Circuit NFTs collection to engage Formula 1 fans interactively and intuitively, has made its launch on Polygon. Over time, Polygon has emerged as the go-to scaling platform, enabling fans to immerse themselves in their passion for NFTs. It has more than 300 NFT DApps in its ecosystem, including Opensea, Aavegotchi, Zed Run, Neon District, Megacryptopolis and more.

The Importance of Polygon in the Blockchain Space

There are several reasons why Polygon has gained such a high level of traction in the blockchain space in a short span. One of the foremost is its Ethereum compatibility. There are several ways by which users or participants can leverage the network to help Ethereum scale. One can choose to engage as a developer, and for these types of users, there is no dearth of material, including guides, documents, tutorials, or SDKs. Otherwise, one can also choose to become a validator or delegator for the Polygon PoS chain and secure the network.

As cited earlier, dedicated blockchains, scalable consensus algorithms, and a custom Wasm execution environment already keep Polygon ahead in the scalability race. Apart from its live or in-development solutions, Polygon also has the Nightfall solution on the Testnet. The Polygon Nightfall is a one-of-a-kind scaling solution that leverages optimistic roll-ups following Zero-Knowledge cryptography.

Polygon also scores high on the security aspect. The modular ‘security as a service’ solution, coming from Ethereum or a pool of professional validators, helps keep it secure. Finally, the ease of development qualities of the Polygon Network is quite unmatchable. Its developer experience is equivalent to Ethereum. One does not need a protocol-level language to work around Polygon. Moreover, it is free from the entry barriers relating to token deposits, fees, or permissions.

Polygon has a robust community backing it. The network has 1.2 million followers on its official Twitter handle. Its crypto ecosystem is similarly expansive and quite all-encompassing. It has more than 440 DeFi protocols in its compatibility list. Moreover, it has nearly 50 DApps and over 300 NFTs. It also supports 150 gaming projects, nearly 100 infrastructure projects, 35 Metaverse projects, and more than 50 DAOs in the supported list. There is hardly any other crypto player that can match such a robust solution and user community.

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