‘Top 10… brings no satisfaction’ says Polygon’s Sandeep Nailwal – Cointelegraph Magazine

Read Part 1 here: Slumdog billionaire: Incredible rags-to-riches tale of Polygon’s Sandeep Nailwal

Growing up in poverty in a Delhi ghetto with an alcoholic father and an illiterate mother, Sandeep Nailwal has always had a fire in his belly to achieve something better.

He wants to go big or go home — middling success is not an option.

“I am not doing something small,” he tells Magazine. “Okay, we build some network, and it has a token. It does well for one cycle and then fades into the dawn, and I make a few million dollars for myself and retire or whatever — this was not the plan.”

“We were very clear that we will build this, we will grow the community, and we’ll make it one of the biggest projects in the space.”

And that’s why, in his mind, Polygon — formerly Matic Network — is yet to truly succeed, despite nudging a $19-billion market cap at one point and joining the top 10 cryptocurrencies by market capitalization (it’s currently No. 13 with a $6-billion market cap).

“Being in the top 10, top 15 projects brings no satisfaction to me. It’s very clear in my mind that I want Polygon to have that kind of impact which Ethereum and Bitcoin have had. We have to go to the top three projects in the space. And that’s only when I would say that ‘OK Polygon has made it.’”

Part 1 of this feature told the story of Nailwal’s rise from grinding poverty to going all-in on Bitcoin with $15,000 he’d borrowed to fund his wedding and the difficult early days of Matic Network, where the threat of running out of funds was ever-present.

By mid-2019, Matic Network had raised $5 million in a Binance initial exchange offering to keep itself afloat and had launched the alpha version of its Ethereum layer-2 sidechain. But it was slowly becoming clear that the Plasma technology it was pursuing was not the answer the market was looking for.

Ideas around scaling had begun to change, and Plasma’s shortcomings (TLDR: complicated, better at transferring assets than running smart contracts) had seen it lose favor. Seeing which way the wind was blowing, the research-oriented Plasma Group decided to ditch the framework altogether in favor of building an Optimstic rollup and renamed the project “Optimism” in early 2020.

But the Matic Network white paper had outlined a Plasma-based solution with fraud proofs and a proof-of-stake checkpoint layer, and the team was determined to follow through and build it in 2019 and 2020, despite waning interest in the tech.

Mainnet market crash and resurrection

Just as the project was gearing up to launch its mainnet in May 2020, a worldwide pandemic and the March Black Thursday market crash intervened. Around 70% was wiped off the already paltry sub-3-cent price of MATIC within the space of 10 days. With fears of a new Great Depression gripping the world, Matic Network’s future again looked in doubt.

“Suddenly, everything felt like it will go to zero. That shock was there for two to three months. We survived that, but what we realized is that, you know, we started with Plasma technology, and now plasma is dead. And now we are launching our mainnet. People are, like, ‘Plasma is dead; there is no interest from the community.’”

Nailwal says the team came to two conclusions.

The first is they’d try and get as many developers and builders as possible. This was a success, as they launched their Ethereum layer 2 just in time for DeFi Summer’s ludicrous gas fees on layer 1.

The second conclusion was to never again put their eggs in one basket.

“We realized that we need to be multichain; we can’t be relying on one particular technology,” he says.

Long-term Ethereum community insider Mihailo Bjelic was also thinking about a multichain future and joined the project to become something of a bridge to markets and communities from which the team felt excluded at the time. Nailwal says the project’s roots in India meant it had a low profile in the Western world, where some considered it to be “just like another internet scam.” 

Also read: Beyond crypto — Zero-knowledge proofs show potential from voting to finance

In early 2021, Matic Network rebranded as Polygon to highlight the change in direction. At the time, Nailwal told Cointelegraph the idea was to become “Polkadot on Ethereum” and to add Optimistic rollups, zero-knowledge (ZK) rollups and StarkWare-style Validiums alongside the PoS network.

But Nailwal says they quickly realized that Optimistic rollups were at best an “intermediate solution” that wouldn’t be able to scale up to have 50 chains working in the ecosystem.

“With ZK, you can imagine a world with […] 100,000 chains; each of them has 1,000 transactions per second (TPS); all of them combined together could be tens of millions of TPS in the whole network. And the architecture will still…