- Arbitrum has surpassed its competitor protocols in recent months.
- Arbitrum has almost seven million addresses registered to date.
Investors continue to pour money into Arbitrum, the much-awaited Layer 2 scaling solution for Ethereum, as they look for alternatives to Ethereum-based investments.
Arbitrum continues to be the leading destination for money moving away from Ethereum, according to statistics provided by CoinShares. By the end of May, the network had brought in $4 billion in funding.
Arbitrum has received a lot of attention and support from investors and developers since its inception in August 2021. Arbitrum, created by Offchain Labs, is a layer 2 solution that improves transaction throughput while remaining compatible with the Ethereum Virtual Machine (EVM), with the goal of resolving Ethereum’s scalability difficulties. Developers may easily move their current Ethereum apps to the Arbitrum network thanks to this interoperability.
Arbitrum has surpassed its competitor protocols in recent months. The debut of its native governance token, ARB, which had been eagerly awaited, was a significant recent event for the network. As a result, the algorithm will decide how many tokens each user receives, with a minimum need of three points.
The maximum point score is 15, and activities may include sending money to Arbitrum One, carrying out transactions, and more. The maximum number of tokens that may be sent to one address at once is 10,200. The initial supply limit of the ARB token, which is used for governance, was set at 10 billion.
ARB token Airdropped to Users
In addition, 125 DAO wallets with over 90 million ARB worth $120 million were airdropped by Arbitrum to early platform users depending on their use over a certain period of time.
The number of daily transactions on the Ethereum-layer 2 scaling mechanism surged past 2.7 million in the days before the catastrophe.
According to statistics, Polygon, which has raised $3 billion, follows closely behind Arbitrum, followed by Optimism ($983 million), dYdX ($342 million).
Arbitrum is Ahead of Other Platforms
The number of transactions dropped to 724 thousand as the excitement died down, but this was still more than 124 percent greater than the numbers reported at the beginning of the year.
This week, the total addresses that have been stored on Arbitrum throughout time passed seven million, while those stored on its competitor, Optimism, were at a little more than three million.
A recent software problem affecting the optimistic rollup’s sequencer caused Arbitrum to temporarily halt the transmission of transactions to the mainnet for around two hours. According to the foundation’s community leaders, the software error “generated network stress created by the enormous backlog of transactions which hadn’t been posted on-chain.”
Other Factors Drawing More Users to Arbitrum
The capacity of Arbitrum to dramatically lower transaction costs is one of the main reasons influencing the flood of money into the company. During times of congestion, Ethereum has been plagued by excessive fees that make certain apps almost unworkable for regular users. Users may benefit from much cheaper costs and quicker transaction confirmation times by using Layer 2 technology from Arbitrum without giving up the security and decentralization provided by the Ethereum network.
Furthermore, Arbitrum’s success might be attributed to the variety of dApps and DeFi protocols that it supports. Arbitrum now supports a wide variety of popular Ethereum-based applications, including decentralized exchanges, lending platforms, and yield farming protocols.
Data from blockchain explorers and industry analytics sites like Dune Analytics and Etherscan show that the total value locked (TVL) in Arbitrum-based protocols has been rising consistently.
In addition, Arbitrum’s active address count has been steadily growing, a sign of greater user adoption and engagement.