 | WHAT: As part of my own research and diligence, I write scathing reviews of popular projects. In the past I have covered Algorand, Cosmos, Solana, CryptoCom and Ethereum outlining why it will fail. In each thread, users often request that I provide the same sort of negative perspective for other projects. RATIONALE: Based on the user suggestion, I decided to trial my own ANTI-SHILL series. I have no intention to upset people and would invite commenters heavily in projects to challenge/clarify the data provided. The overall benefit being that some users will either question their investments or have their beliefs ratified by others. Or better yet, if I cannot find any good reasons to ANTI-SHILL, then maybe this could be a project worth considering. DISCLOSURE: I do not currently hold POLYGON, nor am I an expert in anything. I am a crypto degenerate. DATA SOURCES: Since I'm trying to build this as a series, I'm going to try keep some of the types of evidence and the format consistent, it will include information like supply, sentiment, foundation, adoption usage and project ownership. I regularly access Messari and IntoTheBlock for metrics. ***************************************************** REQUESTS: ***************************************************** THE ANTI-SHILL FOR POLYGON: Polygon is bad. Here's why: INFLATION - Much too high. Staking rewards pail in comparison to the supply increase. There is a significant discrepancy between the inflation calculated by Messari, CoinGecko, Ethplorer and CoinMarketCap versus the stated inflation from the Polygon ecosystem scanner. Whether it is because of some hidden lock mechanic for some tokens, and since these values are suppose to represent the circulating supply, it is not a good look for investors to have to justify why the stated inflation does not match the calculated one. The staking rewards are averaged at 7.1% which is below the stated inflation value, and significantly below the calculated inflation value. Even if I go by the stated value, holding the token still loses 6-7% of its worth every year, even if the price doesn't change.
FALSE TPS NARRATIVE - What they claim it does, is not what it does Polygon, an Ethereum multichain scalability platform, claimed it achieved 7200 tps during stress testing of the Matic Network CS-2008 testnet. As cryptocurrency adoption increases, the number of transactions increases as well. Often, it leads to long transaction processing times. For example, Bitcoin transactions take an average of 10 minutes. Polygon (MATIC) recently claimed it can handle 7200 transactions per second on its network. Stress tests are never suppose to be representative of what the typical use will be, but for the same reason, using the stress test value should not be the value stated that the chain does. Looking straight at the data on Polyscan, the actual TPS rarely exceeds double digits. The average is a mere 36 transactions per second. Or 0.5% of the actual TPS of what Polygon claim. While this is faster than say Ethereum, Avalanche or Cardano, it pails in Comparision to the processing speed of other L1s like Algorand, Fantom or Ripple which average in the thousands. DECENTRALISATION - It is the most centralised network in the top 20. There are currently less than 100 validators on Polygon which is gives a Nakamoto Co-efficient of just 2 according to Nakaflow. This is less than the level of decentralisation of Binance. Just TWO validators have enough control over the network to take it offline or produce false blocks. Even when considered by Ultimate, the NC is still only 3. Of the top 20 cryptos, Polygon is the most centralised chain by a considerable margin. Polygon urgently needs to increase the numbers of validators quickly because the distribution of tokens across the staking validators is a significant risk. According to this CrossTower article six months ago, the levels are still the same. This means that in all this time during the bear market, Polygon has made no efforts whatsoever to increase its level of decentralisation. DEGENERATE CEO - spends more time on Twitter than working The CEO and founder of Polygon, Sandeep is, to put it lightly, arrogant. He regularly trashes other blockchains and his top pinned post on Twitter is about he will not rest until Polygon takes the number three spot. An admirable goal, but when the CEO spends more time on Twitter displaying degenerate behaviour, I find significant concern. If the CEO wants to spends all his time on Twitter, I would want to see them talking about the entire crypto space with positivity and answering questions to clarify misconceptions. What I see from Sandeep is desperation and consistent attempts to become significant in people's eyes - not unlike BitBoy. Here are a few tweets or retweets just from the past few weeks: Here's one of my absolute favorites that clearly shows his high level of self-entitlement. Let's break down that last tweet. Sandeep stole a large NFT project from another blockchain with a $5m bribe (sidebar: A crypto company is buying NFT projects with investor funds is not a good thing). Now he is immediately upset that someone stole his profile pic from said project. Ironic? Perhaps. But also, he is the CEO. He should be focused on building the network. As the NFT project - Y00ts - hasn't migrated from the original chain, Solana, it actually means that Sandeep had to go and buy the NFT on that chain in order to secure the NFT before the bridging occurs. This is despite repeatedly trashing it in previous tweets. Bear in mind, I'm not defending Solana here, just pointing out that this CEO seems to spend a considerable amount of time focused on it. He is regularly baited by degenerates on all sides and seriously needs to focus on the work. OWNERSHIP CONCENTRATION The ownership concentration of Polygon is a significant concern. Whales currently hold roughly 85% of the supply. EIGHTY-FIVE PERCENT. Retail is insignificant in the Polygon space. Worse still, the top 12 wallets control 68% of the entire supply. Put another way, no more than 12 people own 2/3rds of all Matic. If one of these wallets decides to dump their holding, the marketcap will crash by millions in an instant. Remembering from above, for most of the past year, Polygon has made absolutely no efforts to increase its level of decentralisation. Now if you couple this sentiment with the massive control of the supply by just 12 wallets, it is clear the company has no goals whatsoever to become decentralised. In fact, if you consider that most of the funds have gone into securing partnerships with major companies, it is clear they are not looking to adopt the crypto mantra. It wouldn't surprise me if in the future, they start issuing shares and want a listing on the stockmarket. RELIANCE ON ETHEREUM Polygon will fail without Ethereum. These are the words of the CEO, Sandeep. Ethereum is likely not going anywhere, but with the rising success of competitive layer 2's, Polygon is in an uphill battle to stay relevant here. Aside from that, if Eth ever does accomplish scaling, it will render the layer 2's redundant and they all go obselete, Polygon included. To be successful, a project must stand on its own, and Polygon is too closely tied to Ethereum to be considered an independent entity. Any significant challenger to Ethereum will subsequently impact Polygon. Sandeep on Polygon's reliance to Ethereum BIGGEST COMPETITION - Arbitrum All cryptos are essentially in some sort of competition with each other. Due to the rationale, goals and purpose the blockchain, the biggest competitor to POLYGON is likely ARBITRUM. Arbitrum is a cheaper and faster layer 2 on Ethereum and is already increasing its share of transactions and TVL over Polygon. But on the flipside, if Polygon decided to pursue the narrative of becoming its own layer 1, its biggest competitor is now Ethereum - which it currently relies on to work? Probably not the best strategy to compete against the hand that feeds you. ***************************************************** CONCLUSION: Every time a new partnership is purchased by the company, the price goes up. To return to its ATH, it needs only a 3x. This is only a small gain to the upside, but with whales holding 85%, there is a very high risk to the downside. Unless you are actually using the chain, the risk-reward ratio for holding the MATIC token is simply not worth it. TLDR: Just read the bold headlines ***************************************************** DISCLAIMER: I'll always state whether I am involved in the project or not, but you should never trust the word of a degenerate user on Reddit. On top of people shilling their own bags, looking for liquidity exits, there are paid promoters and employers and affiliates in this sub already. IF YOU HAVE CONCERNS: The data is publicly available on sites like CoinGecko, CoinMarketcap, Messari and IntoTheBlock, and should be verified on chain. Don't trust me bro. PLEASE SHOW RESPECT TO OTHERS: Obviously when telling someone their favourite crypto is bad will illicit some negative emotions, especially if they are very heavily invested. I ask that all commenters try to respect each other's opinions and not downvote "just because you don't like it". If you disagree, respond with facts - justify your point, and agree to disagree if necessary. [link] [comments] |
You can get bonuses upto $100 FREE BONUS when you:
💰 Install these recommended apps:
💲 SocialGood - 100% Crypto Back on Everyday Shopping
💲 xPortal - The DeFi For The Next Billion
💲 CryptoTab Browser - Lightweight, fast, and ready to mine!
💰 Register on these recommended exchanges:
🟡 Binance🟡 Bitfinex🟡 Bitmart🟡 Bittrex🟡 Bitget
🟡 CoinEx🟡 Crypto.com🟡 Gate.io🟡 Huobi🟡 Kucoin.
Comments