Ethereum Layer-2 scaling solution Arbitrum has seen a huge spike in network activity since the Nitro update in August, processing roughly 62 percent of Ethereum’s base layer.
Crypto research firm Delphi Digital, in its report based on data from Dune Analytics, stated that as of the week ending October 24, the total number of transactions on the Arbitrum network had increased by 550 percent since August. Delphi Digital stated in a previous tweet that Arbitrum assumed 62 percent of all transactions on the Ethereum network, but later explained that this was a “false statement”.
Arbitrum is a protocol built by Blockchain development company Offchain Labs that aims to scale Ethereum smart contracts and uses Optimistic Rollup technology. It uses Optimistic Rollup technology to compile large batches of transactions from Ethereum smart contracts and decentralized applications off-chain before sending them to Ethereum. Many well-known protocols such as the decentralized cryptocurrency exchange SushiSwap, Uniswap and GMX, loan protocol Aave and liquidity transport protocol Stargate use Arbitrum. According to L2Beat, Arbitrum has a locked asset value (TVL) of $2.59 billion at the time of writing.
Delphi analysts stated that the number of weekly active users on Arbitrum has increased by 125 percent since October 10, reaching 282,000 for the week ending October 24. Analysts also pointed out that much of the increase in network activity was due to speculators trying to increase their activity on-chain in hopes of getting a bigger AirDrop for a native token, which was hinted at by Offchain Labs co-founder Steven Goldfeder.
On August 31, Arbitrum One mainnet received the Nitro update, and Offchain Labs claimed on April 7 that the update would increase network capacity while reducing transaction costs. Low transaction fees have prompted various players from the crypto ecosystem to take action to integrate with Arbitrum One, and on November 1, decentralized finance (DeFi) optimization tool Furocombo, capital raising protocol Aelin and insurance protocol Y2K Finance are each working on their popular scaling solution. announced.
On October 13, Offchain Labs announced that it has acquired Prysmatic Labs, one of the core developer teams behind Ethereum Merge. In the statement regarding the acquisition, he stated that this will enable more communication and cooperation between developments at both tiers.