Offchain Labs, the team behind Ethereum scaling solution, yesterday announced the largest launch of Arbitrum One, the beta version of the project.
While the launch is remarkable, the developer team will still be able to “pause the system” in the event of unforeseen complications, Offchain Labs said. This also means that transaction capacity has been limited to the same level as Ethereum. “Over the coming months and weeks, we will continue to monitor network usage, improve stability and performance, and gradually increase our transaction limit over time,” said Offchain Labs.
Arbitrum leverages a technology called ‘optimistic stacks’ to reduce congestion and fees when interacting with Ethereum.
Instead of trading on Ethereum, users move to a second tier, hence the term tier 2. Here they can spend, send, lend, and borrow everything at a fraction of the cost. At the end of their activity, all these transactions are “written” and settled in a single transaction on Ethereum.
WE KNOW YOU’RE WAITING …
WE ARE PROUD TO ANNOUNCE …
ARBITRUM ONE
SHORT BELOW, SEE YOU ON L2.https: //t.co/fQT8EyyldL
– Arbitrum is available on mainnet! (@voluntad) August 31, 2021
Arbitrum spurs the rise of DeFi tokens
cautious launch was met with a rally of several decentralized funds (DeFi) projects that made up Arbitrum.
DeFi is a subsection of crypto that aims to replicate various traditional financial services, such as loans and loans, but without a centralized entity, such as a bank or a broker.
Aave, for example, allows users to earn interest for depositing different cryptocurrencies on the platform. And since the protocol has already been integrated with Arbitrum One, the expansion of scaling solutions to all cryptocurrencies appears to have led to an increase in Aave’s native token, AAVE.
token is currently trading at $ 398.28, having peaked at nearly $ 410 this morning.
Elsewhere, Uniswap, DeFi’s most popular decentralized exchange, also saw an impressive rally shortly after Arbitrum’s announcement. protocol’s native token, UNI, went from $ 26.53 to a local high of $ 30.47. At press time, UNI is trading at $ 29.94.
se two projects are not the only ones that have made the leap to level 2. Arbitrum One Portal shows dozens of different encryption projects that have integrated the solution.
And as more projects come onboard, the current DeFi experience will be replicated one by one on a much cheaper, faster and more efficient version of Ethereum.
Well, at least one day.
Disclaimer
views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.
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