Polygon Buys Hermez For $250 Million

SYNOPSIS

Hermez Network was purchased for $250 million by Polygon, an Ethereum scaling venture.

The two projects’ native tokens are also being integrated.

According to Polygon co-founder Mihailo Bjelic, this is the first-ever full-fledged integration of blockchain networks.


Sandeep Nailwal, Jaynti Kanani and Anurag Arjun co-founded blockchain scalability platform Polygon in 2017
Sandeep Nailwal, Jaynti Kanani and Anurag Arjun co-founded blockchain scalability platform Polygon in 2017. Via livemint.com

Polygon (formerly Matic Network), an Ethereum scaling project, purchased $250 million for Hermez Network, an Ethereum scaling solution based on ZK-Rollups.

In what is the first time in the crypto world, the two projects are also merging their native tokens, MATIC and HEZ.

Hermez’s items would be incorporated into Polygon under the new moniker Polygon Hermez, according to Polygon, which told The Block exclusively on Friday. As part of the arrangement, Hermes’ 26 employees will join Polygon’s 80-strong crew.

Later Hermez network disbanded its old twitter account and made a new one named as Polygon Hermez after collaboration.

The digital network firm posted and pinned a tweet on its respective twitter handles addressing which twitter account is operational and which one isn’t.

After Hermez announced that it was in talks with a public network about a possible merger, Polygon and Hermez came to a first agreement last week, on August 4.

According to the price at 11:00 CET on August 4 at the time, the two projects had agreed to a peg or swap ratio for their respective tokens.

This means that HEZ token holders will be able to swap their tokens for a wide selection of Polygon MATIC tokens at the current exchange rate of 3 MATIC:1 HEZ Trading contracts, which the projects will publish in the near future, will facilitate this.

SOLUTION ORIENTED INVESTMENT

Polygon’s treasury has also made a $1 billion commitment to ZK-based solutions. According to Bjelic, they see ZK cryptography as the single most important strategic resource for scaling blockchains and developing blockchain infrastructure.

They aim to become the leading force and contributor in this space in the future. There are ZK-Rollups, which are a kind of scaling technology that allows users to bundle transactions into a network (such as Hermez) and then publish their validity proofs on Ethereum.

Due to the fact that transactions are conducted outside the mainnet, Ethereum’s blockchain is relieved of some of its weight and transactions are cheaper.

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