L2 OPTIMISM
A layer-2 Scalability solution for Ethereum🐌
1) What is the issue that Optimism is solving?
A monolithic blockchain like Ethereum 1.0 has three things to do:
- Execution — of transaction, smart contract deployment etc.
- Settlement — claims, balances etc. 📝
- Data availability — history of transactions.
So, when a blockchain does all three functions by itself, we call it Monolithic architecture.
Result: Network gets congested, leading to a rise in transaction costs. 😣
Also, as per the blockchain trilemma, Ethereum focuses on security and decentralization instead of scalability.
2) What is Optimism, and how does it solves the scalability problem?
Optimism is a part of Optimistic rollups which popularly include Optimism and Arbitrum.
What are Rollups?
Rollups are a scalability solution⬆️ for Ethereum where Execution will be taken care of by a shadow chain(Execution layer), and settlement will be done on Ethereum(Settlement layer).
How are rollups(layer-2) different from other solutions?
Say you have interacted with a sidechain, and it got compromised or hacked (you had not used the bridge); this will lead to a total loss of assets. (◕⌓◕;)
Whereas in the case of Rollups, if you have interacted with the shadow chain, say Optimism, and it got compromised, you can still claim your assets from the settlement layer (Ethereum 1.0). •ᴗ•
Optimism is a shadow chain or layer-2 of Ethereum, which will take care of Execution(a).
The architecture is called disaggregated or Modular blockchains.
3) Development around the project:
- They have recently announced the airdrop of the OP token, which will help in the governance of protocol upgrades, project incentives and growth. 🤑
- In Dec 2021, it removed the whitelisting of projects. Now, any project can deploy its Smart contract optimism. 🤩
4) Vision of the project and roadmap ahead.
The vision is not only to scale Ethereum layer-1 but also to commit to giving all of the profits made from sequencing (before decentralizing the sequencer) to public goods funding experiments.
5) Network Stats:
- It saves users $1Billion in gas fees.💰
- 93X cheaper per transaction.
- 60k average transactions.
- approx $777.3M of on-chain value.
- New user retention is on the rise. 👨
6) Competitor’s stats:
Arbitrum and Boba Network are Optimistic rollups, whereas others are ZK rollups which use ZK technology.
7) Investors and Valuation:
Optimism has raised $178.5M in funding over 3 rounds. Optimism’s latest funding was raised on Mar 17, 2022, from a Series B round for $150M.
Paradigm and Andreessen Horowitz are the most recent investors.
8) Twitter sentiment — 153.1K followers📈
