Arbitrum Ecosystem

What is Arbitrum network

Arbitrum is a layer 2 workspace solution based on the Ethereum blockchain. Protocol is aimed at scaling, optimizing and significantly improving the features of smart contracts in Ethereum by adding additional functionality. In essence, Arbitrum is representative of sidechain blockchains.

Arbitrum is a fairly young project, launching in 2021 actually, led by Offchain Labs. However, a little earlier, before the ecosystem was deployed, the startup had an investment round that raised $20 million.

It should be noted that Arbitrum went through several years of extensive testing and refinement before launching. Such a long test of strength has instilled confidence in both ordinary users and developers.

Arbitrum’s decent positioning and the challenges it offers has led to the ecosystem quickly gaining the trust and support of major VC investors.

Key investors include:

1. Polychain Capital
2. Lightspeed Venture Partners
3. Pantera Capital
4. Coinbase Ventures & many others.

Partners

To understand Arbitrum credibility level, it’s worth to look at their key partners:

• Opensea
• Alchemy
• Chainlink
• Circle
• GMX
• Uniswap
• Metamask

And this is not a full list. Note the number of partners that have joined Arbitrum. Over 600+ different DApps!

Key mechanics of Arbitrum blockchain

At the core of an ecosystem is the advanced Optimistic Rollups tech. With this technology, smart contracts from Ethereum interact with Arbitrum smart contracts.

EVM machine support, in its turn, allows it to run various DApps on the ETH network without much trouble. Also, it provides Arbitrum with faster transaction speeds and significantly reduces the cost of commissions on the network.

In charge of securing Ethereum, performing outside network transactions and resolving some disputes, Arbitrum operates an innovative mechanic called Arbitrum One. In fact, it is one of the variants of Optimistic Rollups.

Major elements of Arbitrum:

• Arbitrum AVM for proper integration with EVM (Ethereum Virtual Machine)
• Arbitrum Rollups for scalability and transaction integrity.
• Arbitrum Chain is the foundation in the ecosystem that makes Optimistic Rollup work.

Advantages of Arbitrum

• Scalability
• Low fees
• High-speed transaction confirmation
• Ease of use
• Security

Token ARB

ARB is a native token that was launched in 2023. At the same time, the project held an Airdrop, during which it distributed 12,75% tokens for the community.

In fact, the ARB token is a fundamental element of Arbitrum tokenomics and serves to:

• Pay fees
• Staking
• Rewards for validators
• Developers incentives
• Managing the system as part of the governance mechanism

Conclusion

As we can see, consolidating transactions into Arbitrum brings down costs also makes DApps more accessible to the community. Users and developers get a better experience, thanks to faster transactions and smoother interactions with the ecosystem. And today, thanks to its solutions and drive to revolutionize Ethereum, this ecosystem remains a leader in the top 5 ranking of L2 Blockchains.