Polygon “trades” $ 250 million to get Hermez – The 1st deal with a symbolic merger

Ethereum Polygon Scaling Project (formerly acknowledged as Matic Network) acquired Hermez Network, an Ethereum scaling resolution applying the ZK-Rollups technique, for $ 250 million. The two tasks are also consolidating their platform tokens – MATIC and HEZ – the 1st token merger deal in the cryptocurrency market place.

The 1st deal in the background of the cryptocurrency market place …

Sharing with the media on August 13, Polygon explained Hermez’s providers will be merged into Polygon and the new task will be known as “Polygon Hermez”. As portion of the agreement, 26 Hermez workers will also join Polygon’s staff of 80 men and women.

“This is (as far as we know) the first large-scale consolidation of blockchain networks, where one network will completely absorb the other, including its tokens,” explained Polygon co-founder Mihailo Bjelic.

Earlier this yr, two Ethereum tasks, Keep and NuCypher, also merged their protocols, but each sides stored their manufacturers independent of every other and did not merge the platform’s tokens.

As for Polygon and Hermez, the two sides reached an preliminary agreement final week, on August four, when Hermez announced that they have been in “discussions about merging with a public network”. At the time, the two tasks made the decision on the exchange fee or peg of their tokens based mostly on their rates at eleven:00 CET on August one.

Important updates:

We @hermez_network they are discussing a probable merger with a public network.

Wire

– Hermez network (@rete_hermez) August 4, 2021

The deal, exposed currently, with a ratio of three.five MATIC: one HEZ, signifies that holders of HEZ tokens will be capable to exchange their tokens for a specific sum of Polygon’s MATIC. This will come about by way of swaps that tasks will announce “soon”.

Asked regardless of whether token holders have a say in the deal, Bjelic explained the greatest holders of Hermez, who signify a lot more than 90% of all token holders, are conscious of the deal and are all in agreement. . The deal grew to become attainable for the reason that HEZ is nevertheless an “early stage token,” he explained.

Based on the August four token cost, Polygon has committed a complete of 250 million tokens from its treasury to the merger, which is roughly $ 250 million. According to Bjelic, this sum represents two.five% of Polygon’s treasury. The complete provide of MATIC tokens is ten billion and the latest token cost is all over $ one.forty, in accordance to information from CoinGecko.

Invest in scalability remedies

Polygon has committed an extra $ one billion from its coffers to remedies based mostly on the ZK protocol. “We believe the ZK protocol is the most important strategic asset for blockchain scaling and infrastructure development and we have a clear goal of becoming a leader in this field,” explained Bjelic for many years to come.

ZK-Rollups is a style of scaling technologies that bundles transactions across a network, for illustration Hermez in this situation, and publishes legitimate evidence of this action on Ethereum. This decreases the load on the Ethereum network for the reason that transactions are carried out outdoors the most important network and helps make transactions less costly.

Polygon as a substitute provides quite a few Ethereum remedies. Bjelic says Hermez will be Polygon’s fourth resolution right after Polygon Commit Chain, Polygon SDK, Polygon Avail, and now Polygon Hermez. Polygon Commit Chain is at present the major evidence of stake blockchain constructed on the Ethereum platform. Polygon SDK is a application growth kit for making Ethereum compatible blockchain networks. On the other hand, Polygon Avail is a scalable information availability layer for independent chains and sidechains and the new Polygon Hermez resolution is a ZK-Rollups based mostly Ethereum Layer-two scaling resolution.

As portion of Polygon, Hermez “will focus on developing zkEVM technology to provide native smart contract scalability within ZK-Rollup,” explained Antoni Martin, head of small business growth at Hermez Network. . “This merger will realize our shared purpose of generating a a lot more inclusive, safe, decentralized and permissionless money process on Ethereum. We are committed to operating difficult to make this dream come genuine, “explained Martin.

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