As the cryptocurrency world in general enjoys a surge in excitement in late summer, more and more blockchain developers who have taken the plunge are encountering the full-scale scaling issues facing decentralized applications on the blockchain. of Ethereum. The popular network has seen its popularity explode in the last year, but its transaction volume has remained frustratingly stable as the network continues to operate near its limits, leading to slower transaction speeds and higher on-chain fees. crowded.
Ethereum core developers have been planning significant updates to the blockchain to rectify these problems, but even in the early stages of the crypto world, the network transition is a daunting and lengthy task. That is why developers are looking for so-called Layer 2 cumulative scaling solutions, which sit on top of the Ethereum network and handle transactions separately in a cheaper and faster way, while still recording transactions on the chain. of Ethereum blocks, albeit in batches.
The Layer 2 landscape is early, but crucial to Ethereum’s continued scalability. As a result, there has been quite a bit of passionate talk among blockchain developers about the first players in the space. Offchain Labs has been building a particularly hyped accumulated network called Arbitrum One, which has built up notable support and momentum since the developer beta was released in May, with about 350 teams signing up for access, the company says.
They have attracted some high-profile partnerships, including Uniswap and Chainlink, which have promised early support for the solution. The company has also quickly attracted investor interest. The startup tells TechCrunch it raised a $ 20 million Series A in April this year, quickly followed by a $ 100 million Series B led by Lightspeed Venture Partners that closed this month and valued the company at $ 1.2 billion. Other new investors include Polychain Capital, Ribbit Capital, Redpoint Ventures, Pantera Capital, Alameda Research, and Mark Cuban.
It has been quite a long journey for Arbitrum technology to reach public access. The technology was first developed at Princeton; can you find one Youtube video where the technology was first seriously discussed in early 2015. Professor Ed Felton and his co-founders, CEO Steven Goldfeder and CTO Harry Kalodner, detailed a deeper underlying insight in a 2018 research paper before licensing to Princeton technology and build the company. . Felton previously served as deputy US chief technology officer in the Obama White House and, along with Goldfeder, authored a major cryptocurrency textbook.
After a long period of secrecy and a few months of limited access, The startup is set to publicly launch the Arbitrum One mainnet, TechCrunch is told.
This team’s scaling solution has few direct competitors (a16z-backed Optimism is its most notable rival), but Arbitrum’s biggest advantage is probably the seamless compatibility that features decentralized applications designed to run on Ethereum, compared to competitors. What may require more heavy lifting on the part of the developer is full compatibility with your cumulative solution. That selling point could be important as Arbitrum seeks court support on the Ethereum network and crypto exchanges for its product, although most Ethereum developers are well aware of the overall stakes.
“There is much more demand than supply in Ethereum,” Goldfeder tells TechCrunch. “Rollups give you the security derived from Ethereum, but a much better experience in terms of costs.”