Polygon formerly known as Matic Network, an Ethereum scaling project, has paid $250 million for Hermez Network, a ZK-Rollups-based Ethereum scaling solution. The two projects are also integrating their native tokens, MATIC and HEZ, in what is the first time this has happened in the crypto world.

Hermez's offerings will be combined into Polygon under the new name 'Polygon Hermez', according to Polygon. Hermez's 26 employees will join Polygon's 80-strong workforce as part of the agreement.

It appears to be the first-ever full-fledged merger of blockchain networks, with one network absorbing the other's token as well.

Keep and NuCypher, two Ethereum projects, integrated their systems earlier this year as well, but they maintained their branding separate and did not merge their tokens.

Earlier this month, Polygon and Hermez announced that they were in discussions for a future merger with a public network. The two projects agreed on a peg or swap ratio for their tokens depending on their pricing at the moment.

HEZ token holders will be able to swap their tokens for many of Polygon's MATIC tokens as per the disclosed peg of 3.5 MATIC: 1 HEZ. This will happen as a result of the swapping contract, which the projects will publish soon.

Polygon has pledged a total of 250 million tokens, or around $250 million, from its treasury for the merger, based on the token pricing of August 4th. This also happens to represent about 12.5 percent of Polygon's treasury and 2.5 percent of MATIC's overall supply. MATIC coins have a total quantity of 10 billion and are currently trading at about $1.40.

It’s said that Polygon committed another $1 billion from its coffers to ZK-based solutions. It views ZK cryptography as the single most important strategic resource for blockchain scaling and infrastructure development in the years ahead, and we have a clear aim of becoming the dominant force and contributor in this field in the next few years.

ZK-Rollups are a sort of scaling technology that allows users to bundle transactions into a network, such as Hermez, and publish their validity proof on Ethereum. Since transactions are processed outside of the mainnet, this minimizes the burden on the Ethereum blockchain and allows for cheaper transactions.

Polygon, on the other hand, provides a number of Ethereum-related services. After Polygon Commit Chain, Polygon SDK, Polygon Avail, and now Polygon Hermez, Hermez will be Polygon's fourth solution.

Polygon Commit Chain, based on Ethereum, is the company's main proof-of-stake blockchain. The Polygon SDK is a software development kit that allows you to create Ethereum-compatible blockchain networks.

The new Polygon Hermez solution is a ZK-Rollups-based Ethereum Layer-2 scaling solution. Polygon Avail is a scalable data availability layer for standalone chains and sidechains, whereas Polygon Hermez is a ZK-Rollups-based Ethereum Layer-2 scaling solution.

Hermez is expected to work on creating the zkEVM technology to allow native smart contract scalability within a ZK-Rollup as part of Polygon.