Hop Protocol Cuts Polygon Withdrawal Times to Minutes

Hop Protocol Cuts Polygon Withdrawal Times to Minutes

August 11, 2021

Key Takeaways

  • Hop Protocol has cut MATIC withdrawal times from Polygon to Ethereum from seven days to five minutes.
  • The project has introduced a novel cross-chain automated market maker with liquidity pools consisting of MATIC and hMATIC.
  • Polygon has allocated $400,000 in MATIC for Hop liquidity providers.

The Hop Protocol update allows for quick MATIC withdrawals from Polygon to Ethereum.

New Bridge Update For Polygon Users

Hop Protocol has announced a new cross-chain liquidity solution that lets users withdraw MATIC tokens from Polygon to Ethereum within five minutes. The solution bypasses the need to use Plasma Bridge, which takes up to seven days for MATIC withdrawals.

Currently, two bridges allow the flow of tokens between Ethereum and Polygon: the PoS Bridge and Plasma Bridge. Of the two, the PoS Bridge allows faster deposits and withdrawals between the two chains and is most commonly used for transfers.

The PoS Bridge takes roughly seven to eight minutes to deposit funds from Ethereum. Withdrawing funds to Ethereum mainnet takes about an hour.

The Plasma Bridge is used specifically for MATIC withdrawals because it has enhanced security guarantees. But unlike the PoS bridge, the inner workings of the Plasma implementation can take up to a week for withdrawals to go through on Ethereum mainnet.

This can lead to a bad user experience when a user wants to send MATIC to Ethereum mainnet or deposit MATIC to a centralized exchange.

To solve long the issue of very long MATIC withdrawal periods, Hop Protocol has launched a novel cross-chain automated market maker with liquidity pools consisting of MATIC and hMATIC, a bridge asset pegged to MATIC.

The protocol allows users to swap MATIC 1:1 with hMATIC tokens whenever they want to deposit or withdraw to and from Polygon.

The bridge will be able to send MATIC to Ethereum as well as other networks like xDai within five minutes rather than the seven days it takes with the Plasma Bridge.

According to the team, the Hop bridge will also be cheaper to use, but the speed of transfers will depend on the liquidity in its pools. DeFi projects like Hop’s rely on deep liquidity to operate to their best standard.

To incentivize liquidity, the Polygon team has granted $400,000 worth of MATIC rewards for Hop liquidity providers. In the first reward phase, 1,000 MATIC tokens are available each day and can be earned by staking MATIC on Hop Protocol.

Besides the latest MATIC-specific solution, Hop also runs a cross-network solution for instant USDC transactions between Ethereum, MATIC, and xDai.

The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.

You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.

See full terms and conditions.

Source: Read Full Article