Polygon, both the MATIC token and the ecosystem token, I think these are both investments that are going to trend more towards zero than being a good investment. That is my opinion and my experience, not financial advice, and I'm going to walk you through the research that leads me to believe there are much better investments to be made in crypto today. I see some serious problems that hardly anybody's talking about with Polygon, and I think we need to address them.
The first glaring issue: the fully diluted market cap
The first huge, glaring issue I see is the technology's fully diluted market cap. Polygon is at about the same market cap as Internet Computer. And Polygon is basically like a sidechain, kind of a copy of Ethereum, whose whole narrative is on scaling Ethereum. But when they say on their X that this is groundbreaking technology, to me that's a joke. It's not. In the simplest terms, it's just another Ethereum layer two with very similar technology to Ethereum itself.
What I think groundbreaking technology actually looks like
Once you've seen what I consider truly groundbreaking technology in crypto, like Internet Computer, the difference is night and day. This is an on-chain computational world, the first real world computer. You can put a gigabyte of memory on chain for $5 a year. You can host your website on chain, the way jerrybanfield.com is hosted fully on chain. You've got OpenChat, which is like a Discord or a Telegram that is fully on chain. To me, this is record-breaking, smashing technology.
The team behind it, DFINITY, has what I believe is the largest research and development team in blockchain. They keep innovating and improving the protocol every day. The governance and the business system, in my view, are so far superior to anything else. It has voting rewards. It eliminates the need for any ETFs because you can fully self-custody. You can actually vote on everything that happens in the network. To me, that's groundbreaking technology.
Polygon, by comparison, is just another Ethereum layer two. And that means I don't want to invest in it, because I don't want to invest in anything that's not an outlier, where there's nothing else that can do what it can do. Polygon is just another player in what currently is a crowded, competitive game. The only hope I think it has is narratives and hype and speculation. This is the same lens I bring to all of my coin reviews over in my Money playlist: is this an outlier, or just another copy?
The MATIC to POL migration is, to me, an incredibly greedy move
Here's another huge problem I see with Polygon. This Polygon MATIC token is migrating to the Polygon Ecosystem Token, or POL. To me, this is an incredibly greedy move. On the surface, what they're telling you is that they're hyping this up for Polygon 2.0. It's a roadmap for scaling Ethereum to build the value layer of the internet, and POL unlocks that for the future. In my opinion, that's a joke. Why? Because Internet Computer has an Ethereum layer two now that I believe is vastly technologically superior to Polygon in almost every way. And it has a Bitcoin layer two on the exact same infrastructure. So you can build apps that have Bitcoin, Ethereum, ICP, and stablecoins, all on chain.
Polygon, by comparison, has nothing like that. A value layer of the internet? You can't build a website on Polygon. You can't put your NFTs on Polygon. You can put up a picture, but it has to be hosted off chain. So they're making this out to be a next-generation token that can power a vast ecosystem of ZK-based L2 chains. Let me tell you what I think this really is.
How I've seen these "2.0" upgrades wipe out the people who aren't paying attention
They're making this seem like it's a good thing. But here's what I see as the dark, nasty side of this. In my opinion, the real goal is to screw over all the people who aren't paying attention and are holding the Polygon MATIC token, getting them to convert to the Polygon ecosystem token. Because all the people who've got 50 cryptos in their portfolio and aren't paying attention every single day, who forget about their MATIC token, they're not going to upgrade and they're not going to move over to the ecosystem token.
And what I think is going to happen, as I've seen happen with many of these other "2.0" scam token upgrades, is that the people who aren't paying attention are going to lose everything. Depending on where they've held their coins, like if they held them in their own wallet, they're going to come back and wonder why their MATIC token went to zero. They're not going to realize that they needed to upgrade, quote, to this ecosystem token.
With other tokens, we've seen that certain crypto exchanges like Coinbase wouldn't even support Gala Games' upgrade to version 2. I've personally talked with people who lost thousands of dollars in Gala because Coinbase refused to do the upgrade — these are the kinds of conversations I have with members one-on-one inside the Jerry Banfield Family. The investors who had like a two-week window to upgrade lost everything. If you didn't upgrade after that, Coinbase is holding your tokens, your tokens have gone to zero, and you can't swap them because nobody wants the old version of the tokens. I went deeper on that exact situation in my Gala Music review.
I can't stand these "upgrades," because what they're saying on the surface versus the real intention is, in my view, an exact lie. I see no reason for it outside of the fact that they want another token, and they want another price chart too.
Another price chart, more hype
Most cryptos, and since so many people all they do is look at the price chart, Polygon — if somebody doesn't know any better, and you'd be amazed how many people in crypto don't know any better — will come to this page and think this is a new token that just launched. Now, I know some of you are thinking nobody would believe that once it's the main token. But people will think the token just launched. And I think they'll probably manipulate the price, try to get the chart to look all green, and try to get a whole bunch of hype.
What I think is going to happen is you're going to get a bunch of people who got ripped off buying Polygon up at many dollars, and now the price has just dumped and dumped. Over the last year, while Bitcoin, Ethereum, and ICP are all up like double from what they were a year ago, Polygon has done nothing but dump. In my experience, Polygon has been one disappointment and misdirection after another.
"Build on Polygon" is, to me, extremely deceptive
Polygon, for example, paid a massive amount of money to many partners to, quote, build on chain. If you go to their website, it says "build on Polygon." But let me put it to you this way. If you have an application that is, quote, built on Polygon, and 99% of the computation is done off of Polygon, would you consider that built on Polygon? My house is on land. But if 99% of my house was on land and 1% was on water, would you say my house was built on water? No, you'd say my house was built on land. This "build on Polygon" framing is extremely deceptive, as it is for most of the rest of crypto.
They paid huge amounts of money to get mainstream companies to, quote, build stuff on Polygon, which they launched and then quickly sunsetted and quietly quit those partnerships, because in my view the technology by itself does very little and most of the work has to be done computationally somewhere else. For example, if you want to launch an NFT collection, you're going to need to host all the pictures off of Polygon. It will need to be hosted on something like Amazon Web Services, which is not decentralized, and people like Elon Musk see that that's a joke. You're not going to pay money for some on-chain picture that's actually hosted off chain? To me, that's ridiculous.
So Polygon has been, in my opinion, a leader in being deceptive about building "on Polygon" versus what it really means to be on Polygon. You would think that building on Polygon, or doing a Web3 game, means the whole game is on Polygon, when in fact almost none of it is on Polygon and it's almost all on regular old web hosting. This is the same pattern I keep flagging with Ethereum layer twos in general, like in my Loopring review and my LayerZero review.
Carbon neutral and other diversions
Another problem with Polygon: look at the foundation. You'll see there's a ton of different founders on Polygon. Then you have a little history, which for some reason is in a hard-to-read font. You have total diversions, like "Polygon goes carbon neutral." Again, what does it matter if the blockchain is carbon neutral when most of the things that actually would use the blockchain are centralized and off chain — and are those carbon neutral?
You've got things like Internet Computer that actually run the entire website, your whole app, and your NFTs all on chain, and the power consumption is tiny. So to me that is much more carbon neutral, or environmentally friendly, than Polygon. But they're not going to put those two side by side for you.
The active-address numbers are easily manipulated
Now, if you look at the unique addresses, people will say, well, look how many people are using Polygon, look at these daily active users. This data is easily manipulated. For example, you had ZEN launch on Polygon. ZEN was a token that ripped a whole bunch of people off, and I'm sad to say I promoted it before I started to primarily be a crypto investor first and just talk about my own research, instead of being a content creator first who primarily cares about views and the money I'm making and how much you like me, and only invests in crypto after that.
The ZEN token created huge amounts of additional addresses on Polygon and these other chains, making it look like there was this huge activity. But sometimes you have individual accounts minting ZEN, and they would create thousands of addresses. One single person minting ZEN, creating thousands of additional addresses. So you've got some apps and tokens like that, where the app single-handedly creates a huge number of addresses, and the chain loves it, because then when people come to look, they figure, oh wow, there were 800,000 new addresses on some of those days. In reality that could be like 20 people who minted. That might even be playing it down a little. But on some of these days, there is remarkably little real activity.
The gas-fee trap that catches small holders
That's because the only way you can use Polygon is to pay gas fees to do everything. That means you have to buy Polygon first. And if you're trying to send USDC on Polygon, you need to have the Polygon token and then the USDC also.
I've personally used Polygon. I had it in a wallet and I tried to stake it, and you have to stake it on the Ethereum mainnet, which means paying Ethereum gas fees, because Polygon comes back to just being an Ethereum token. If you're moving the Ethereum token directly on Ethereum, you're stuck paying ETH gas fees. And if you have a small amount on Polygon, like people who have a small amount of the MATIC token directly in their own wallet, Ethereum gas fees could be so high that they might not even be able to swap over to the ecosystem token. To me, that's the exact purpose of doing an upgrade like this. The dark side that nobody wants to talk about is that it screws over the investors with small amounts of money who can't pay the gas fee.
To me, Polygon is everything that's wrong with crypto
That's why I find the whole Polygon situation so offensive — to me, this is everything that is wrong with crypto. They lay off a whole bunch of employees, and then you look at the headlines saying the Polygon chain is one of the biggest layer two blockchains. Biggest in terms of what? In terms of data, it has assisted over 2.4 billion transactions. Now, that would make you think it's great, and it's recorded a bunch of sales volume. But you're selling stuff when people are using OpenSea.
I launched an NFT collection on OpenSea, which I quickly closed. You don't even think, when you're doing this, that you're selling an NFT whose picture is off chain, which means it's always going to be centralized. The third-party marketplace, OpenSea, controls everything that's happening. It's not decentralized at all.
Where are the engineers?
Then you've got articles saying things like the team's growth during the last crypto bull market diluted the qualities it wants in its employees. Really? This whole thing just stinks to me. And if you look at the team, how many engineers are actually working on this? If you go to the Polygon Foundation website and look at the About page, you've got a bunch of co-founders on there, but where are the teams of engineers working on this? You can't see them publicly. And that's because, well, I've talked to some of these crypto developers.
Now, if you look at DFINITY, the foundation behind Internet Computer, they have what I believe is the largest research and development team in blockchain — bigger than Polygon's, at the exact same market cap. They rapidly put out innovations for the chain all the time. And they have no need to do this scammy upgrade to a second level of the token. In my estimation, they've innovated probably 10, maybe 20-plus times as much in the technology, maybe even 100 times as much depending on how you want to define it, as the Polygon team has in roughly the exact same amount of time.
Why I think holding Polygon has worked out poorly
So, to me, there's no way I would want to invest in this. In my opinion, this is going to work out poorly for most investors, as it has over the last year. Over the last year, holding Polygon has worked out very poorly for most people, because this is probably around where a lot of people bought, and now they've lost money in it.
The fully diluted market cap on this, to me, is just screaming overvalued, which is why I believe they need to scrape all the little investors. It's easy for the whales to swap over, but then the little investors get scraped moving over to this, and to me it's just completely disingenuous. Polygon, for me, is an example of everything that is offensive, disingenuous, and deceptive in crypto, across so much of what they've done.
I owned it, and I had to face my own confirmation bias
And I bought Polygon last year. I was holding Polygon last year. One of the reasons so many people in crypto just tunnel-vision in is that they buy something, and then they tunnel-vision in, and it feels great because they bought it. Because if you then sell it, or if you're holding it and somebody tells you it sucks, you have to face that you were wrong, that you bought something that was not good.
I went through that with Polygon. I did my research. I was holding the token specifically to overcome confirmation bias. At one point I was holding a little bit less of it than Internet Computer, but not much. And I did my research on many other cryptos, including Internet Computer and Polygon, and I went deeper and deeper. I tried to stake it. The more I used it, the more I looked at the ecosystem, and the more I learned about Internet Computer, the more I came to believe — with very high confidence, as my own opinion — that Polygon is going to zero and is going to be a bad investment.
What happened over the last year of trending downward, despite so many other things like Bitcoin, Ethereum, and ICP going up, makes me think we're going to see more of this kind of price action. In my opinion, any upsides will be temporary and manipulated, and you'll have to exit immediately. So I swapped all my Polygon to ICP when I did more research on both of them. This ecosystem token is, to me, a desperate move by a company, a foundation, that knows things are not going well — a desperate move to try and squeeze some more life out of something that I believe is dying.
Being the reluctant hero
I know this is very critical, and I'm being your reluctant hero here. Hardly anybody in crypto wants to come out and be the person who says everything's going to zero, because you don't get a lot of people to like you that way. You don't get any sponsorships that way. But I think it's truly useful. Everybody's saying everything's going to 100x right now. Great — but in my experience, it's not. Look at the facts. Look at the details. In my opinion, almost everything trends towards zero instead of being a good investment. If you want to go through that research with me one coin at a time, that's exactly what I do across my Money playlist.
One of the reasons I can say all of this freely is that my website is hosted directly on the Internet Computer Protocol, which is something you simply cannot do on Polygon, and I don't see a realistic future where you can. If you found this review helpful and you want to ask me to review any crypto you're holding, the best place to do that is right alongside me inside the Family, where I take requests and go through the research live.