Indian crypto startup Polygon buys Hermez for $ 250 million; companies to merge tokens

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MUMBAI: During the very first crypto token merger, Ethereum scaling project Polygon announced that it would merge with Hermez, a zero-knowledge crypto-based scaling project (ZK ) in a $ 250 million deal. Zero-knowledge technology makes it possible to verify data such as transactions and personal information or identification without ceding control of the information.

The Indian crypto startup will now operate under the new name, Polygon Hermez. In addition, all components of the Hermez project – technology, live solutions, its team of 26 people and HEZ token – will be integrated into the Polygon ecosystem.

The maximum amount that will be committed for this merger by Polygon Treasury is 250 million Matic tokens, or approximately $ 250 million based on the price at the time of the deal (August 4). This merger is our first major foray into the ZK scaling arena after publicly announcing ZK-based solutions as our strategic goal for the future, ”Polygon said in a blog on Medium, a platform online publication.

According to Polygon, so far only a few real attempts have been made to merge two networks. This is sort of a historic moment since it will (to our knowledge) be the first full-fledged merger of two blockchain networks. “

Polygon also announced that HEZ token holders will be able to exchange their tokens for native Polygons (Matic) tokens through the swap agreement the companies will announce soon.

The swap ratio was set at 3.5 Matic: 1 HEZ. In addition, the HEZ token will cease to exist after a specific date, which has not yet been announced.

Matic is among the top 20 cryptocurrencies with a market capitalization of over $ 9.5 billion. On Friday night, the token was trading around 13% higher at $ 1.51, down 42% from its all-time high of $ 2.62 it hit on May 18.

On the other hand, the HEZ token commanded a market cap of around $ 55 million and was trading 16% higher at $ 5.

Polygon (formerly Matic Network) was co-founded in 2017 by three Indian software engineers Jaynti Kanani, Sandeep Nailwal and Anurag Arjun.

Polygon is the first well-structured and easy-to-use platform for scaling and developing Ethereum infrastructures.

The company tries to solve blockchain issues such as high gas costs and slow speeds, without sacrificing security.

In recent times, demand for Layer 2 scaling solutions has attracted capital inflows, which in turn has fueled the rise of Matic tokens, which is Polygon’s native cryptocurrency.

Earlier this year, billionaire American investor Mark Cuban invested in the Indian startup.

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