During a recent Ask Me Anything (AMA) session on the r/India community on Reddit, Sandeep Nailwal, who is the co-founder of Polygon, a platform that scales Ethereum, expressed his belief that Web3 gaming will emerge as a prominent driver of widespread cryptocurrency adoption. In response to a question regarding potential “real-life” use cases for blockchain beyond trading and payments, Nailwal shared his perspective on the matter.
Nailwal responded by asserting that he considers gaming to be the most significant opportunity for cryptocurrencies on a large scale. He further elaborated that several top games are set to launch in the Web3 space within the next 6-18 months, and it will be intriguing to observe if any of them can successfully leverage the potential of cryptocurrencies. Nailwal also noted that last year, the Web3 gaming sector attracted over $2 billion in funding, with Polygon and its associated ecosystem players such as IMX receiving the most funding for these games. He expressed optimism that some of these games will achieve substantial success in the future.
In March, Polygon and Immutable X joined forces to develop a scalable gaming blockchain that incorporates Polygon’s EVM-compatible zk-rollup technology, which is anticipated to enhance the speed of blockchain games. During the AMA, Nailwal was asked if he believes that cryptocurrency has become excessively speculative. While he did not reject this notion, Nailwal acknowledged that speculation has been both a blessing and a curse for the cryptocurrency industry.
Nailwal acknowledged that speculation has had both positive and negative effects on the cryptocurrency industry, stating that it has attracted outstanding talent, while also leading to a significant number of speculative users and applications. However, he argued that speculation is a common phenomenon in nascent industries that have the potential to become significant in the future, citing the examples of the Gold Rush era and the Dot Com boom.
During the AMA, other members of the r/India community inquired about Nailwal’s views on decentralization. Nailwal responded by stating that the cryptocurrency industry is still in its early stages, and he does not believe that any blockchain ecosystem, with the exception of Bitcoin and Ethereum, is entirely decentralized at present. He further elaborated that it is not necessary for networks to be fully decentralized from the outset.
In Nailwal’s opinion, what is required is a gradual shift towards decentralization of protocols and applications as they gain greater prominence. During the AMA, another member inquired about Polygon’s low Nakamoto Coefficient rating, which is a measure of a blockchain network’s level of decentralization.
The Nakamoto Coefficient is a metric utilized to measure the degree of centralization of Proof-of-Stake (PoS) chains. It is determined by calculating the number of node operators who jointly possess over one-third (33.33%) of all stakes on the network. According to NakaFlow, Polygon’s PoS chain has a Nakamoto Coefficient rating of only four, which implies that a mere four node operators have control over roughly one-third of Polygon’s PoS chain.
In response to the inquiry, Nailwal clarified that Polygon is a multi-blockchain ecosystem that currently has two active public blockchains: Polygon POS and Polygon zkEVM. While the Nakamoto Coefficient of the Polygon POS chain may be lower, it is still greater than that of many other sizable blockchains. Nailwal went on to state that the long-term objective is for all public chains, which are not application-specific, to have substantial decentralization factors. The Polygon team is currently working on several significant releases, and the ultimate aim is to have thousands of validators within the Polygon ecosystem.
