Arbitrum Set For Disrupting Polygon?
Layer 2 Solutions are changing the landscape of Ethereum and the expectation in Web3
What is Arbitrum:
One of the hottest layer 2 solutions built on the Ethereum network is Arbitrum. Arbitrum provides scaling to the Ethereum network by utilizing optimistic rollups. Optimistic rollups are much more efficient than Ethereum's layer 1 transactions which results in a fraction of the fees and costs associated with transacting on Arbitrum vs Ethereum high gas fees. Arbitrum being a layer 2 on Ethereum means they utilize Ethereum’s secure network in order to not compromise on security.
Arbitrum is Buzzing:
Arbitrum has caused quite the buzz recently. New Arbitrum accounts have surged this past month to add to the cumulative amount of total wallets totaling over 2 million.
Source: https://dune.com/Henrystats/arbitrum-metrics
Trading volume on an Arbitrum dex called Gains Network breaks $1 billion in trading volume in a week.
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And over $2 billion in two weeks setting a record and even outperforming L2 giant Polygon.
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Arbitrum has been making some big moves as of late like their integration with Reddit. This integration migrates Reddit’s point system to use Arbitrum Nova to onboard 250k users in a single day.
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By the Numbers:
Dune analytics shows Ethereum had processed over 1.06 million transactions on January 10th, whereas Arbitrum and Optimism combined had processed over 1.12 million transactions respectively and Arbitrum continues to process over 500k transactions throughout the week. If you combine layer 2’s they are starting to process just as much or more in some cases than layer 1 Ethereum itself which paves the way for layer 2’s like Arbitrum as more than just a viable option with a long term pathway.
Source #1: https://cointelegraph.com/news/optimism-and-arbitrum-flip-ethereum-in-combined-transaction-volume
Source #2:
https://dune.com/blockworks_research/l2-comparison-dashboard
Furthermore there have been more decentralized exchanges moving to Arbitrum like Trader Joe who have played a major role on other blockchains like Avalanche further adding to the Arbitrum ecosystem. Trader Joe has launched their own community initiative complete with rewards upon the Arbitrum launch to add to the excitement.
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With so much action going on in the Arbitrum ecosystem it has pushed the TVL to $1.23 billion to rival Polygon’s TVL to almost exactly the same TVL in recent days.
Source: DefiLlama
Arbitrum seems to be cementing itself as Layer 2 leader in the space. Don’t be too surprised to see more action and more use cases like Gamefi take off in 2023. Treasure DAO has been dubbed the “decentralized Nintendo” of the blockchain space and is setting the standard here. We could see more action happen this year with more games being added to the ecosystem.
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Final Thought:
In conclusion, despite Arbitrum not having its own native token yet this could set up one of the most highly anticipated token airdrops to date given the ecosystem has had meaningful growth. Some would recommend getting involved in the Arbitrum ecosystem in order to take advantage of a possible token airdrop to reward existing users for interacting with the ecosystem. Users have flocked to GMX and Gains Network as a result in order to position themselves in the event that the token airdrop does occur as an example. In summary, Arbitrum could take center stage in 2023 and have a breakout year so be on the lookout.