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Why transaction is so low?

Idk why and how, but it's very nice, can you are explain how they do this?

  • Polygon
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Sergey Ilin.
Oct 28 2022, 23:09

I assume that the question is about fee on Polygon being low.

It is important to understand how fee price is determined. Each blockchain has maximum number of transactions that it is able to handle. This value is calculated based on 2 parameters: how many transactions on average can fit into single block and how often new blocks are created. When the demand, number of new transactions submitted to the blockchain, exceeds number of transactions that blockchain is capable to handle then transactions begin to compete with each other for the place in the next block. The only way for them to compete is increasing the transaction fee that each transaction is willing to pay.

Up until this point Ethereum was capable handling 10-20 transactions. That it is very low throughput of the network. Because of the high demand transaction fees on Ethereum are high. It is important to note that TPS of Ethereum is expected to increase in ETH 2.0. It uses different consensus mechanism, Proof of Stage instead of Proof of Work, and various other scaling solutions will be implemented soon.

Polygon PoS, that Peeranha is running on, used Proof of Stake consensus from the beginning, as well as bigger block size. Because of that it is able to create more blocks faster and fit more transactions into each block. As the result, it is capable handling 65,000 TPS. It is important to note that Polygon PoS is a sidechain of Ethereum. For additional security, it saves checkpoints on Ethereum blockchain periodically. So, because Polygon PoS is capable handling a lot of transactions per second and demand does not exceed its capacity transaction fees are so low.

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Web3 (also known as Web 3.0) is an idea for a new iteration of the World Wide Web which incorporates concepts such as decentralization, blockchain technologies, and token-based economics.

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