Polygon, an Ethereum-based Layer-2 protocol, has raised $450 million in a private token sale led by Sequoia Capital India, flagging the company’s most significant funding round since its establishment in 2017.
Sequoia Capital India led a $450 million funding round through a private sale of its native Matic token, with participation from SoftBank Vision Fund 2, Galaxy Digital, Galaxy Interactive, Tiger Global, Republic Capital, and investors such as Alan Howard (co-founder of Brevan Howard) and Kevin O’Leary (of Shark Tank fame).
“With this war-chest, the core team can secure Polygon’s lead in paving the way for mass adoption of Web3 applications, a race that we believe will result in Ethereum (ETH-USD) prevailing over alternative blockchains,” the company said in a blog post.
Congestion and costs have increased as the ethereum network has grown in popularity. Polygon has built a number of scaling options and claims to have “among the industry’s lowest transaction rates.”
As in the past, MATIC (the Polygon network’s native token) is anticipated to be the primary beneficiary of the Ethereum scaling story (this time with ZK rollups). Over the previous year, the network has been growing its portfolio of Ethereum scaling tools.
Polygon announced a $1 billion investment in ZK rollup-related projects in August 2021, and since then has announced the $650 million acquisitions of Hermez Network and Mir Protocol.
According to Polygon, Mir Protocol has the quickest ZK-proof technology, which means it can generate proofs faster and validate more transactions in a single proof.
Hermez is a decentralized ZK rollup that focuses on scalability of payments and token transfers on the Ethereum network to substantially cut transaction costs while also fostering community activities through its Proof-of-Donation mechanism.
Polygon will also be able to keep investing in cutting-edge zero knowledge (ZK) technology with the newly raised funds, which will be critical in onboarding the next billion users to Web3.