Optimism runs on top of the Ethereum mainnet (layer 1). Although transactions happen on Optimism, the transaction data is posted to the mainnet, verifying it. It is comparable to using a highway's security while driving down a less congested side street.
Defi Llama says Optimism is the second-largest Ethereum layer 2, with $313 million locked inside its smart contracts. First place goes to Arbitrum with $1.32 billion.
One of the Layer 2 scaling solutions is Optimism. Optimistic rollup is a method that divides massive volumes of transaction data into manageable portions to power this system. Compared to Ethereum, Optimism is significantly more affordable to use, and it is rising in popularity alongside other layer 2s like Arbitrum.
The OP token, often known as the optimism token, controls Optimism. In a tumultuous launch in late May 2022, a chunk of the OP supply was airdropped to early Optimism users. The creators of Optimism promised to keep airdropping new tokens.
Ways in which Optimism is helping Ethereum and scaling ETH are:
1. Optimism is making Ethereum faster and less expensive:
The purpose of Optimism is to scale Ethereum. The scaling approach bundles transactions back onto the Ethereum mainchain after processing them elsewhere.
2. Reduced Fee:
Optimism charges significantly lower transaction fees. Its rolling mechanism aggregates several transactions into one, lowering transaction costs.
Transactions are settled on the Ethereum Mainnet, allowing users to take advantage of the security and decentralized nature of the Ethereum blockchain. At the same time, Optimism's Layer 2 is built on top of Ethereum.
4. Improved user experience:
New projects employing Optimism Layer 2 scaling solutions gain access to lower fees, quicker transactions, and an improved user experience overall.
The purpose of Layer 2 solutions is to minimize the load on the Ethereum network. Two primary characteristics excite early adopters of cryptocurrencies. First, transactions can happen virtually instantly if there is Optimism. The cost of transactions on the Ethereum blockchain is over ten times lower.
However, compared to Ethereum, Optimism has traditionally been more centralized.
But in April 2022, Optimism made a significant step toward decentralization by establishing a DAO called the Optimism Collective to manage the protocol and finance public goods. As previously indicated, Optimism has started airdropping freshly minted OP tokens to users of Optimism and other individuals who could support the DAO. The ongoing growth of the network and the rising popularity of ETH will probably make Optimism one of the important crypto-projects of the future. So, when the Optimism grows, it will help Ethereum to scale.
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