Arbitrum Chain 101: Understanding the Basics of Ethereum's Layer 2 Scaling Solution
What is Arbitrum in Crypto?
Arbitrum crypto is a Layer-2 solution project built upon the Ethereum chain which is designed to solve Ethereum’s low transactional throughput and enhance speed scalability for developing decentralized applications (dApps). Further, Arbitrum also facilitates easier execution of unmodified Ethereum Virtual Machine (EVM) contracts for developers.
Arbitrum deploys the “roll up” approach to log batches of transactions submitted on the Ethereum main chain to its Layer-2 chain which is scalable and much less costly in terms of transaction fee.
The project is led by 3 blockchain experts namely Ed Felten who is a professor on leave at Princeton and a Chief Scientist at Offchain Labs, Steven Goldfeder who is the CEO at Offchain Labs holding a Ph.D. from Princeton University and is known as a co-author of Bitcoin and Cryptocurrency Technologies, and lastly Harry Kalodner who is the Chief Technical Officer at Offchain Labs.
What is Arbitrum used for?
As mentioned, Arbitrum’s primaly objective is to lower network congestion and transaction fees by easing the burden such as enormous data storage out of Ethereum’s mainframe. This allows a drastic increase in working speed and maximum efficiency.
Is Arbitrum network safe?
Arbitrum network’s aims are to speed up transactional execution and lower gas fees without compromising Ethereum’s excellent security. The validators in Arbitrum must abide by the rules by staking ETH as a guarantee. If the rules are violated then the staked funds will be confiscated as the consequence.
However, there are countless scams aiming to rip off ignorant newcomers all over the landscape. So everyone is advised to double or triple check the authenticity of any sources before taking action.
Is Arbitrum the same as Ethereum?
Ethereum network is considered Layer-1 (L1) and Arbitrum is as Layer-2 (L2). Layer-2 refers to a secondary framework or protocol that is built on top of an existing blockchain system. The main goal of most Layer-2 protocols is to solve the transaction speed and scaling difficulties that are being faced by the main Layer-1 network. So, the two are distinctly different.
Is there a coin for Arbitrum?
Arbitrum has recently launched its native token $ARB, which is now available for trading on several cryptocurrency exchanges, including Arken Finance
How do I make money in Arbitrum?
If you are a trader, you can simply take profits from trading tokens in the Arbitrum ecosystem, such as $GMX, $GMD, $ARB, and many others.
If you are a developer, you can develop dApps on Arbitrum’s ecosystem and start earning on your own projects.
What apps are on Arbitrum?
Arbitrum has integrated over 250 dApp including popular protocols in the industry such as 1inch, Arken Finance, Aave, Balancer, Cream Finance, Curve, DAI, Dfyn, or DODO. The Maker DAO, Uniswap, and Sushiswap communities also voted to integrate on Arbitrum.
The full list of apps on Arbitrum can be found on its dApp portal website.
Last updated
