- Sandeep Nailwal has become the CEO of the Polygon Foundation to speed up decision-making and address growing competition in the Layer-2 space.
- Nailwal plans to streamline Polygon’s efforts by shutting down or spinning off all projects except AggLayer and Polygon PoS.
- After rapid growth from 2021 to 2023, Nailwal believes Polygon has lost momentum.
Sandeep Nailwal, co-founder of Polygon, has been appointed the new CEO of the blockchain project’s foundation, as the platform faces increasing competition in the Layer-2 scaling space.
The appointment comes amid the growing success of newer DeFi players leveraging AI-powered services, placing pressure on Polygon to remain competitive and accelerate innovation.
New Polygon Foundation CEO
Nailwal told Bloomberg his return to a leadership role was driven by a need for faster execution in the rapidly evolving blockchain sector.
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The foundation, which oversees Polygon’s development and long-term strategy, is undergoing significant changes.
This leadership transition is pivotal for Polygon, following the resignation of a third co-founder and a high-profile rebranding from MATIC to POL.
These events have sparked concerns among some industry observers regarding the long-term stability of the Ethereum scaling solution.
Regaining Momentum
According to Nailwal, Polygon’s pace of growth has slowed in recent years.
“From 2021 to 2023, we went from a 10 to a 100 phase,” he said. “Now it feels like we’re back to one to 10.”
Polygon gained significant traction during the 2021 crypto boom, raising over $400 million in a 2022 token sale.
But now the firm needs to return to faster growth, according to Nailwal.
“We need to move fast and make quick decisions,” he told Bloomberg.
Polygon’s Refocus
To refocus efforts, Nailwal stated that all projects outside of AggLayer and Polygon PoS would “either be spun out or shut down.”
AggLayer is Polygon’s cross-chain communication layer, enabling users to interact seamlessly across different blockchains.
Nailwal also highlighted inefficiencies caused by the foundation’s experiment with decentralized decision-making, which he said introduced “all sorts of slowness.”
He referenced the broader debates within the Ethereum community about the role of Layer-2 networks.
While these solutions help scale Ethereum, some critics argue they may also divert activity from the mainnet.
“Suddenly, we have to reimagine everything and go back to the drawing board,” he said.
Mounting Competition
Polygon is facing increased competition from other prominent Layer-2 solutions such as Arbitrum and Optimism.
Arbitrum, which uses optimistic rollups to enhance transaction efficiency, has gained a significant lead in Total Value Locked (TVL), recently surpassing $2.5 billion.
Its decentralized exchanges consistently process around $200 million in daily volume (source).
In contrast, Polygon’s TVL stands at approximately $1 billion, less than half of Arbitrum’s, highlighting the urgency for strategic changes under Nailwal’s leadership.
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