- Polygon developers are going to increase the network's block gas limit.
- The move will bump up transaction throughput.
- It comes with some tradeoffs, however.
Polygon developers are planning to bump up transaction throughput on the network by 33% in a bid to tap into the stablecoin hype sweeping the crypto industry.
They’ll do so by increasing the block gas limit, a way for the blockchain to include more transactions in each block it produces.
“The key requirements for a successful payments orientated blockchain are things like fast finality, and also stronger guarantees or expectations around block inclusion,” Adam Dossa, senior vice president of engineering at Polygon Labs, told DL News.
By increasing the block gas limit, Polygon wants to grow the number of transactions it can handle in advance of an anticipated rise in demand.
“What we’re keen not to do is to lag the market, to wait until the blockchain is horribly congested,” Dossa said.
The move comes as Polygon reorients itself from catering to so-called DeFi degens, risk-taking crypto users who live on the fringe of what the technology offers, to something much more vanilla: facilitating stablecoin payments and transfers of real-world assets, like tokenised versions of US Treasury bonds.
And the timing couldn’t be better.
In June, Treasury Secretary Scott Bessent predicted that US dollar stablecoins could grow to a $2 trillion market in the coming years.
‘Ultimately, we want to get up to 5,000, 10,000 transactions per second. This is one step along that journey.’
— Adam Dossa, senior vice president of engineering at Polygon Labs
Bessent’s comments, coupled with similarly bullish forecasts from analysts and the passage of landmark stablecoin legislation in the US, sparked a stablecoin rush as investors and businesses seek to capitalise on the trend.
Polygon Labs is one of several blockchain firms aiming to carve out a larger share of the stablecoin market as it expands.
Closing the gap
Since the start of the year, the monthly volume of peer-to-peer stablecoin transactions on Polygon has grown almost 40%.
There are more than $3 billion stablecoins on the blockchain, an all-time high, according to DefiLlama data.
Still, it lags far behind market leaders.
Ethereum is in pole position with $156 billion worth of stablecoins, followed by Tron with almost $79 billion.
Closing this gap, while the stablecoin trend is still buzzy, is the primary reason behind the network’s upgrade.
The proposed block gas limit increase will bump up Polygon’s theoretical capacity from 1,071 transactions per block to 1,428.
It’s not the first time Polygon has increased transaction throughput in this way, and it won’t be the last, according to Dossa.
“Ultimately, we want to get up to 5,000, 10,000 transactions per second,” he said. “This is one step along that journey.”
Tradeoffs
But there are tradeoffs to increasing transaction throughput.
Bundling more transactions into fewer blocks hurts the network’s decentralisation. That’s because the network is programmed to pick one of its validators to verify each block of transactions. With more transactions in each block, the ratio between transactions and verifying validators decreases.
Another issue, Dossa said, is that higher transaction throughput also increases Polygon’s state growth at a faster rate.
A blockchain’s state is a snapshot of all data on the network, including account balances, smart contract logic, and other information. The more transactions a blockchain processes, the faster its state grows.
To be sure, these problems aren’t unique to Polygon. Other blockchains looking to increase the number of transactions they can handle are also impacted.
To offset the problems, Polygon is also upgrading its technical architecture in tandem with increasing transaction throughput.
One upgrade which is currently being tested on Polygon’s Amoy testnet is statements verification, which lets validators verify transactions without needing the blockchain’s full state.
From a practical perspective, this allows validators to verify larger blocks without having to run more powerful and costly hardware, Dossa said.
The block gas limit increase is set to take place early in the fourth quarter of the year.
Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.
