Polygon (MATIC) Loses Bid To Build ApeCoin DAO Layer 2

Polygon Labs’ efforts to become the preferred Ethereum Layer 2 chain hits a snag.

Polygon Labs’ campaign to become the dominant Ethereum scaling tech stack provider has recently hit a road bump.

Over the past three months, Polygon Labs has tried convincing the ApeCoin DAO to launch an Ethereum Layer 2 chain using the Polygon CDK instead of competing tech stacks. These efforts have proved futile after a recently concluded two-week vote.

Arbitrum Beats Polygon (MATIC)
Polygon first put its hat in the ring to launch ApeCoin DAO’s ApeChain in October 2023, arguing that a zero-knowledge Ethereum Layer 2 powered by the CDK was the best salve to scaling issues the project had experienced during NFT mints on Ethereum.

Following complaints over the cost of migrating, in January 2024, Polygon Labs sweetened the deal with a $3 million ecosystem development fund while offering to cover maintenance and blockchain explorer costs for three years. These, however, failed to get Polygon Labs the desired result.

On Thursday, February 15, a two-week-long vote to decide the preferred tech stack for ApeChain concluded. In what became a two-horse race between Polygon Labs and Arbitrum, the latter managed to edge out the former with 50.35% of the votes to Polygon’s 32.57%.

In line with the vote, instead of becoming a ZK Ethereum Layer 2 chain with Polygon’s CDK, the ApeCoin DAO will migrate to an AnyTrust Arbitrum Orbit chain. Like a validium, ApeChain will use off-chain data availability solutions to save on cost and maximize transaction speeds for use cases like gaming. At the same time, ApeChain will also retain ApeCoin for transaction fees.

How Arbitrum’s Proposal Compares to Polygon
On the surface, there is minimal difference between Polygon’s proposal and Arbitrum’s. On both ends, the ApeChain DAO was granted an opportunity to build a highly customizable blockchain that processed transactions cheaper than the Ethereum network. At the same time, both teams offered to cover running costs for three years.

However, a deeper dive suggests that Arbitrum’s implementation partner, Horizen Labs, may have played a key deciding role. As detailed in the proposal, the Horizen Labs team already boasted a close work history with ApeCoin, having helped launch the project and the Otherside in collaboration with Yuga Labs.

“The company [Horizen Labs] is committed to enhancing the utility of ApeCoin and guiding successful decisions on the technical, economic, and ecosystem growth aspects of any ApeChain proposal,” Arbitrum’s proposal read.

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