Polygon (MATIC)

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Field

Content

General information

S.1

CASP Name

BB TRADE ESTONIA OÜ

S.2

Relevant legal entity identifier

984500L05A5D0E66Q610

S.3

Blockchain network name

Polygon

S.4

Name of the crypto-asset

POL

USDC

S.5

Consensus Mechanism

Proof of Stake (PoS)

S.6

Incentive Mechanisms and Applicable Fees

The Polygon PoS chain is secured by a network of validators who stake MATIC tokens to participate in block production and validation. This PoS mechanism allows for high transaction throughput, low fees, and significantly reduced energy consumption compared to Proof of Work.

Incentives:

Validators: Are selected to create new blocks based on their staked MATIC. They earn rewards in MATIC for validating transactions and securing the network. These rewards often come from a portion of transaction fees and inflation (newly minted MATIC).

Delegators: Token holders can delegate their MATIC to validators, sharing in the rewards and contributing to network security without running a node themselves.

Checkpointers: A subset of validators submit periodic checkpoints to the Ethereum mainnet for enhanced security.

Fees: Transactions on Polygon PoS are paid in MATIC (gas fees), which are significantly lower than on Ethereum mainnet. The fees are designed to be predictable and accessible, fostering widespread adoption. With the introduction of Polygon 2.0 and the POL token, the incentive structure is evolving to support a broader ecosystem of ZK-powered chains.

S.7

Beginning of the period to which the disclosure relates

2024-01-01

S.8

End of the period to which the disclosure relates

2024-12-31

Mandatory key indicator on energy consumption

S.9

Energy consumption

~121,537 kWh per calendar year

S.10

Energy consumption sources and methodologies

The energy consumption of the Polygon network is primarily attributed to the electricity used by its validator nodes and supporting infrastructure for its Proof of Stake consensus. Unlike Proof of Work, there is no energy-intensive mining. Methodologies for estimation typically involve:

Hardware power draw: Estimating the power consumption of typical server hardware used by validator nodes. 

Node count and uptime: Scaling this by the number of active validator nodes and their operational uptime.

Polygon has actively commissioned third-party audits (e.g., by CCRI) to assess its energy footprint, focusing on the operational energy of its PoS chain and its proportional allocation of underlying Ethereum Layer 1 emissions (which have significantly reduced since Ethereum's Merge).

Supplementary key indicators on energy and GHG emissions

S.11

Renewable energy consumption

~99%

S.12

Energy intensity 

~0.000079 kWh per transaction

S.13

Scope 1 DLT GHG emissions – Controlled

0 t CO2eq per calendar year

S.14

Scope 2 DLT GHG emissions – Purchased

~55 t CO2eq per calendar year

S.15

GHG intensity 

~0.00000 kg CO2eq per transaction

S.16

Key energy sources and methodologies

The energy sources for Polygon PoS validators are those of the data centers and hosting providers where they operate. These locations draw from regional electricity grids, which include a mix of conventional (e.g., natural gas, coal) and renewable energy sources (e.g., hydro, solar, wind, nuclear). Methodologies for assessing this involve:

Geographic distribution: Identifying the locations of validator nodes.

Grid mix data: Correlating these locations with publicly available datasets on electricity generation mixes and their associated carbon intensity factors.

Importantly, Polygon's commitment to being carbon negative means they actively track these emissions and purchase carbon credits to offset them, effectively supporting renewable energy and carbon removal projects.

S.17

Key GHG sources and methodologies

The primary source of Greenhouse Gas (GHG) emissions for Polygon's direct operations is Scope 2 (indirect emissions from purchased electricity). Methodologies for estimating these emissions involve:

Energy consumption * Emission Factor: Multiplying the estimated total electricity consumption of the Polygon network (S.8) by the carbon intensity (grams of CO2 equivalent per kWh) of the electricity mix where validators operate.

Carbon offsetting: Polygon's unique aspect is its active program to measure its comprehensive carbon footprint (including direct emissions, emissions from its underlying L1, and other operational emissions) and then offset 100% or more of these emissions by purchasing high-quality carbon credits on-chain, making the network carbon negative. This commitment moves beyond just reporting to active environmental stewardship.