The Network

The EOS system was designed to support decentralized applications, commonly called dApps, on a commercial scale. EOS provides the core functionality for businesses to build blockchain applications.

EOS Blockchain

EOS is a blockchain-based, decentralized platform used to develop, host, and run business applications, or dApps.

EOS launched In June 2018 after an initial coin offering that raised $4.1 billion in crypto for Block.one, the company that developed the open-source software called EOS.IO that is used on the platform.

EOS cryptocurrency tokens are used as a payment system on the network.

KEY TAKEAWAYS

• EOS is a blockchain-based platform that enables the development of business applications, or DApps.

• EOS supports secure access and authentication, permissioning, data hosting, usage management, and communication between the DApps and the Internet.

• EOS.IO is the system architecture.

• The EOS token is the network's cryptocurrency.

• Its main competitor is the better-established Ethereum platform.

Understanding EOS

EOS supports core functionality that allows businesses and individuals to create blockchain-based applications in a way that is similar to web-based applications. EOS provides secure access and authentication, permissions, data hosting, usage management, and communication between dApps and the Internet.

EOS is supported by a web toolkit store that aims at hassle-free app development.

The Basics of EOS.IO and EOS Tokens

The EOS ecosystem is composed of two key elements: the EOS.IO software and EOS tokens:

• EOS.IO is akin to the operating system of a computer. It manages and controls the EOS blockchain network. The software uses blockchain architecture for vertical and horizontal scaling of DApps.

• The EOS token is the cryptocurrency of the EOS network.

Currently owned by the block.one company, EOS was launched by Dan Larimer, who is also the founder and creator of established platforms including Bitshares and Steem.

How EOS Is Different

EOS is seen as a direct competitor to Ethereum, with ambitions to be bigger, better, and faster. Especially faster: while Ethereum reportedly can handle 15 transactions per second, EOS is aiming for millions of transactions per second. Note that this is a goal, not a reality.1

With the size of the DApps ecosystem increasing every day on the blockchain networks, the limited availability of resources is a major issue. EOS.IO attempts to address these problems by offering more scalability, flexibility, and usability through its unique mechanism.

A developer needs only to hold EOS coins, rather than spending them, to use network resources and to build and run DApps. Token holders who are not running any apps can allocate or rent their bandwidth to other participants who need it.

What is Polygon? MATIC explained

Polygon is a stack of protocols designed to fix Ethereum’s scalability issues. The Polygon network addresses the network’s challenges by handling transactions on a separate Ethereum-compatible blockchain.

Polygon then returns transactions to the main Ethereum blockchain post-processing. This approach lowers the network load on Ethereum. In doing so, Polygon can speed up transactions and lower transaction costs to less than a cent.

In other words, Polygon, formerly known as Matic network, provides an easy framework for new and existing blockchain projects to build on Ethereum without scalability issues.

Using Polygon, users can interact with any decentralized application (DApp) without ever having to worry about network congestion.

How Polygon works

The Ethereum blockchain can perform a limited number of transactions per second. The throughput rate sits at roughly 14 transactions per second for the base layer. Each transaction comes with transaction costs called gas fees on Ethereum.

Gas fees ramp up during times of high network congestion, and Ethereum gas fees can rise quickly to above $50 to $80. This is a massive issue. Having to pay more than $50 at one time for each transaction places Ethereum squarely out of reach for most users.

Network congestion also makes the Ethereum blockchain process slower, discouraging users from engaging with smart contracts on the blockchain.

These issues can quickly add up to hundreds of dollars in fees for anyone who uses decentralized finance (DeFi) apps and protocols, trades or purchases nonfungible tokens (NFTs) and swaps, buys or transfers tokens on Ethereum.

So, how does Polygon make this cheaper? To cut gas costs, scaling solutions like Polygon process transactions on side chains. Polygon has the potential to handle up to 65,000 transactions per second, whereas Ethereum can process only up to roughly 17 transactions per second.

And, Polygon is able to provide these fees to users for pennies. Contrast that price with Ethereum’s average transaction fee of around $15 per transaction. Since Polygon comprises a suite of different protocols including the zero-knowledge (zk) proof variety, users get to choose the best scaling option suited to their use.

In cryptography, zk proofs are a cryptographic primitive used for verifying to another party (the verifier) whether a particular statement is valid. At the same time, the prover is not required to provide any additional information, other than the fact that the statement is true.

Of the multiple options project teams can choose to integrate using Polygon, the most popular are plasma sidechains, a proof-of-stake (PoS) blockchain bridge, zk rollups and optimistic rollups. Matic began with plasma sidechains, which are lighter and more secure sidechains.

Like sidechains, a plasma chain is a separate blockchain that runs alongside the primary blockchain. In this case, Ethereum is the “primary” or “parent” blockchain. Plasma chains link up to and communicate with the main blockchain to allow assets to transfer between them securely.

Due to the high demand from developers, Polygon introduced a blockchain bridge to its product lineup. The PoS bridge allows developers to create DApps on one platform without having to sacrifice the benefits afforded by other platforms.

Processing batches of transactions on its own PoS blockchain eliminates the need for Ethereum to process all the files on its own. By batching transactions off the main chain, Polygon makes Ethereum lighter and faster.

Zk rollups process bundles of transactions off-chain and create validity proofs, verifying that each bundle of data is accurate. These validity proofs are then sent to the main blockchain.

Each validity proof acts as a proxy for the bundle it represents which reduces the amount of data on the main chain. In effect, this approach reduces the time and gas fees required to validate a block of transactions.

Optimistic rollups use a different type of proof system called fraud proofs. Once a fraudulent transaction is discovered, a fraud-proof protocol self-executes and determines the correct transaction based on the data available on the main blockchain.

Those who update transactional data on the system are required to stake ETH. Consequently, if anyone submits a fraudulent transaction to the main Ethereum chain using optimistic rollups, their stake is slashed.

Polygon recognizes that there is no single best solution that will accommodate all applications. Each scaling solution comes with tradeoffs between security, sovereignty, transaction fees and transaction speed. Developers should have the option to select the best-suited scaling solution for their application. And, Polygon offers the most complete suite of scaling solutions.