Arbitrum (ARB)
Arbitrum is a suite of Ethereum scaling solutions that harness the power of the ARB token to facilitate high-throughput, low-cost smart contracts, ensuring both speed and security. Developed to enable developers to run unmodified Ethereum Virtual Machine (EVM) contracts and Ethereum transactions on a second layer, Arbitrum retains the robust security of Ethereum's layer 1. Governance of Arbitrum is managed by the Arbitrum DAO.
In January 2019, Arbitrum successfully raised $3.8 million through seed funding and an additional $20 million through a Series A round. By 2021, a remarkable $120 million was secured through a Series B funding led by Lightspeed Venture Partners. In May 2021, Off-chain Labs launched the mainnet beta of Arbitrum One, initially accessible only to developers. This launch resulted in the deployment of over 300 decentralized applications (dApps) and accumulated over $1 billion in total value locked (TVL). In June 2022, Arbitrum Odyssey, an eight-week program, was introduced to attract users to the Arbitrum One network, featuring eight stages each focusing on different aspects of the Arbitrum ecosystem.
Overview of Arbitrum
| Ticker | ARB |
| Category | Smart Contract Platform |
| Website | https://arbitrum.io/ |
| @arbitrum | |
| Telegram | arbitrum |
| Contract Addresses | |
|---|---|
| arbitrum-one | 0x91...48 Copied! |
| arbitrum-nova | 0xf8...adCopied! |
| ethereum | 0xb5...d1Copied! |
Arbitrum is a trustless layer 2 protocol designed to facilitate fast and inexpensive transactions while maintaining full Ethereum smart contract functionality. It employs the transaction roll-up technique, which records batches of transactions on the Ethereum main chain while executing them on scalable layer 2 sidechains, thereby leveraging Ethereum to ensure accuracy. This approach alleviates much of Ethereum's computational and storage burden and enables the development of advanced layer 2-based dApps.
Arbitrum aims to provide a user-friendly platform for launching scalable and efficient Ethereum-compatible smart contracts. Within the Arbitrum network, ETH is utilized for transaction fees, and transferring to Arbitrum is typically 90–95% less expensive than transferring to Ethereum. The platform also features its custom virtual machine, the Arbitrum Virtual Machine (AVM), which facilitates the execution of smart contracts and ensures compatibility with Ethereum through automatic translation.
How Arbitrum works
To interact with an Arbitrum chain, users' transactions are forwarded to the Arbitrum Sequencer, which submits them onto layer 2 (L2) and reports transaction results similarly to an Ethereum node, but with enhanced speed. These transactions are recorded on the Ethereum blockchain, ensuring data accessibility. Once a transaction achieves finality on Ethereum, it is considered complete and immutable.
After transaction data is posted to the Ethereum blockchain, execution shifts off-chain to Arbitrum validators, who process the transactions and present the results as an assertion or rollup block. This assertion is optimistically posted on the Ethereum chain, with proof only required if challenged. Validators stake their credibility, risking forfeiture if dishonest behavior is detected. A challenge window allows validators to contest assertions, and successful fraud detection is rewarded. If unchallenged, the assertion is confirmed by Ethereum, ensuring reliability in fraud prevention.
Arbitrum products
Arbitrum One
Arbitrum One is an optimistic rollup layer 2 scaling solution for Ethereum, designed to facilitate fast and cost-effective transactions, particularly for decentralized finance (Defi) and non-fungible tokens (NFTs). Users can engage with Arbitrum One through various providers, including Alchemy, Infura, QuickNode, Moralis, ANKR, BlockVision, and GetBlock.
Arbitrum Nova
Arbitrum Nova employs the Anytrust scaling model to offer even lower transaction costs, tailored for gaming and social applications. An EVM-compatible chain, Nova is optimized for ultra-low-cost transactions while ensuring strong security. Launched in August 2022, Nova is ideal for gaming projects, social platforms, or applications demanding high throughput and low transaction costs. It is supported by trusted organizations such as Offchain Labs, Reddit, Google Cloud, Consensys, and FTX.
Technology behind Arbitrum
Optimistic Rollups
Arbitrum utilizes the Optimistic Rollups concept, enabling developers to swiftly deploy smart contracts and decentralized applications on Ethereum with reduced fees and increased bandwidth. This approach assumes that transactions within the rollup are valid, facilitating rapid updates to Ethereum without requiring immediate proof. Transactions are batched and settled on a private sidechain before being integrated back into the Ethereum blockchain ledger.
The decision to build Arbitrum as an Optimistic Rollup (OR) was guided by the belief that OR meets users’ needs for a secure, trustless, EVM-compatible layer 2.
AnyTrust technology
AnyTrust is a variant of Arbitrum Nitro technology that reduces costs by incorporating a mild trust assumption. It introduces a trust assumption for lower fees, managed by a Data Availability Committee (DAC) comprising entities like Consensys, FTX, Google Cloud, Offchain Labs, P2P, Quicknode, and Reddit.
Arbitrum partners
Arbitrum collaborates with various partners to enhance its ecosystem, including Chainlink Labs, Dopex, GMX, Hop Protocol, Lido Finance, Livepeer, Quick Node, Synapse Protocol, Treasure DAO, Uniswap Foundation, Unlock Protocol, Vesta Finance, Coinbase Ventures, Pantera, Compound, and Blocknation.
Arbitrum team
Arbitrum is developed by Off-chain Labs, a team of researchers, engineers, and Ethereum enthusiasts with expertise in cryptography, decentralized systems, and game theory. Key team members include Ed Felten (Co-Founder and Chief Scientist), Steven Goldfeder (Co-Founder and CEO), Harry Kalodner (Co-Founder and CTO), along with senior software engineers and operations managers.
ARB token and DAO launch
On March 16, 2023, the Arbitrum Foundation announced the airdrop of ARB, Arbitrum’s new token, to community members on March 23, 2023. This launch marked Arbitrum’s transition into a decentralized autonomous organization (DAO), allowing ARB holders to vote on key decisions governing Arbitrum One and Arbitrum Nova networks. The Arbitrum DAO will have authority over core protocol decisions, technology upgrades, and ecosystem support.
ARB token
ARB is the native governance token of Arbitrum, used for transaction fees and governance within the protocol. Holders can participate in decision-making processes, including protocol upgrades and changes. The total circulation of ARB is 10 billion, with 56% controlled by the Arbitrum community. The airdrop distributes 11.5% of the supply to eligible users and 1.1% to DAOs within the ecosystem, while the remaining tokens are managed by the Arbitrum DAO treasury.