After several years of development, Arbitrum is officially launched. More than 150 projects have requested early access to the development system. A launch that looks very promising. Especially since the first users of the system confirm a very strong reduction of the transactional cost (up to 270 times less)! We tell you more about this L2 in this article.
What is Arbitrum?
Arbitrum is a technical L2 solution based on the underlying Ethereum blockchain.
It is an ideal solution for many applications DeFi or applications open to the public because not only is it based on a very reliable underlying blockchain, but also its technical solution significantly increases the number of transactions per secondwhich allows him to significantly reduce the costs associated with each transaction.
A new generation tool
Arbitrum is the second next-generation layer of decentralized applications based on the Ethereum Blockchain. It is a tool offered to decentralized applications to help them migrate to a faster and more economical model.
The future of DApps
This is a necessary update for the proper functioning of some decentralized applications.
Arbitrum is based on the underlying Ethereum blockchain
This is clearly a guarantee of long-term security!
The security of the Ethereum blockchain is no longer in question. Second largest capitalization in the crypto universe, and probably on track to become the largest in a few months when it completes its migration to the Proof-Of-Staking consensus model.
The Ethereum blockchain is a real security guarantee for potential investors.
This is probably what attracts many DApps to deploy on Arbitrum. By developing a decentralized application on this tool, we benefit from the security associated with Ethereum.
Bancor users seem to be delighted with the deployment on Arbitrum: without any changes to the Smart Contract, the deployment has reduced the cost associated with each transaction by 270. An extraordinary performance!
Users of the decentralized Mcdex application have also experienced transaction fees divided by 270! Without any changes.
The official website of the Arbitrum sidechain is very ambitious. The idea behind the project is to allow its users to build a decentralized application in just a few minutes. A rather ambitious goal, but not impossible as we will see.
Key benefits of the project:
- Full scalability of the decentralized application
- A considerable reduction in the cost of each transaction
- Validation by validators chosen by the decentralized application.
- A very quick and easy migration to level 2.
- A well-supplied technical documentation.
Why use Arbitrum?
We will see below that the advantages offered by this tool are numerous.
Arbitrum is a migration solution for all Level 1 decentralized applications running on Ethereum.
1. A 100% scalable solution
Ethereum is a highly secure solution, but its capacity is too limited (only a few transactions per second).
The widespread adoption of crypto-currencies around the world requires greater capacity to support them on the network. Currently, it is estimated that the credit card network generates an average of 56,000 transactions per second.
The Arbitrum sidechain provides an answer to this problem. Arbitrum is a solution that clearly exceeds the computational and storage limitations of the underlying Blockchain.
2. Very low transaction cost
The transactional cost associated with Arbitrum is very low: up to 50 times lower than on the first layer of the system. Arbitrum offers a low storage cost for computation, regardless of the number of resources used.
3. 100% automatic contract conversion: strong portability
The conversion of contracts is 100% automatic. No new computer language to learn. The tool provides technical documentation, however, to facilitate integration for new applications. The Arbitrum tool converts your existing contracts into Arbitrum contracts. Arbitrum is 100% portable. The tool works with web3, ethers and go-ethereum. This way, the tool adapts to your system and you don’t need to rewrite your front-end.
The transfer of tokens between Layer 1 and Arbitrum is 100% transparent and secure. Your old tokens are fully supported by Arbitrum.
Unlike other tools that do not necessarily offer the same degree of security as the underlying blockchain, Arbitrum is as reliable and secure as Ethereum.
5. High degree of confidentiality
If you are looking for smart private contracts, Arbitrum is for you. The way the tool works ensures that only the developers or validators of a sidechain can see your code. The transactions executed on the network are visible.
The Arbitrum project also brings together exceptional engineers. The founder and CTO of the tool is none other than Ed Felton, formerly a professor at the prestigious Princeton University.
Is Arbitrum more effective than other Tier 2 solutions?
Arbitrum has many advantages over other Level 2 systems.
First of all, Arbitrum does not publish the source code of smart contracts. This can be seen as an advantage or a disadvantage. We consider this to be an undeniable advantage, as it favors proprietary development projects. This confidentiality is sometimes necessary to maintain a non reproducible source code. This improves the security of the application.
Another big advantage of the solution is that the decentralized application can also choose its own validators. The tool requires only one honest validator to ensure the correct operation of a decentralized application. This is an advantage not offered by other Level 2 systems. Only the validators approved by the decentralized application do the work to calculate and form a consensus for each smart contract. This allows for a considerable increase in contract throughput and storage capacity, as the bandwidth is not limited by a consensus mechanism.
- Arbitrum allows the execution of arbitrary smart contracts, unlike the Plasma solution.
- The system is more secure than the Optimism solution because the anti-fraud system is based on several levels.
- The tool is also compatible with the Ethereum blockchain. A guarantee of safety for users.
Arbitrum is a tool that promotes the adoption of a more advanced and faster consensus model. We find that the real genius idea lies in the possibility for the founders of a decentralized application to choose the honest validators themselves. This reduces disputes, the delay of each transaction and also the cost of each transaction. A very promising tool that should quickly be adopted. There are already nearly 150 projects potentially interested in the tool.
Our articles are written for educational and informational purposes. We do not provide investment advice. Any investment carries a risk of capital loss. Never invest more than you are willing to lose.
Frequently asked questions :
- What is Arbitrum?Arbitrum is a new Ethereum sidecahine for decentralized applications.
- What is the Arbitrum token?Arbitrum does not have a token on its blockchain.
- Is Arbitrum compatible with other sidechains?For the moment it is not possible to bridge Arbitrum with another sidechain.