Ethereum scaling solution Arbitrum launches token and Layer 3 blockchains
Offchain Labs Inc., the developer of the Ethereum blockchain scaling solution Arbitrum, announced today that it will release, or give away for free to select individuals, its new token $ARB, a new cryptocurrency that will be used to vote on two of its blockchain products .
The company also announced the launch of the Arbitrum Foundation and a DAO, or Decentralized Autonomous Organization, to manage the development of Arbitrum One, its main blockchain, and Arbitrum Novawhich was designed for social media and games.
Steven Goldfeder, CEO and co-founder of Offchain Labs said that the launch of the new organizations will lead blockchains to greater decentralization. “Through the community airdrop, the delegation process, and the introduction of the Security Council, community participation and control are at the forefront of today’s announcement, and the requirements to receive a share of Arbitrum governance are carefully crafted, optimizing for ecosystem and community longevity,” he said.
Decentralization is a fundamental principle of blockchain technology and what is known as Web3, which relies on multiple copies of ledgers to cryptographically protect transactions across the peer-to-peer network from potential tampering. Its use also gives rise to decentralized applications, or dapps, that run using self-executing code across networks without the need for central servers. With cryptocurrencies and tokens, developers have built entire decentralized economies, games, social networks and more using the blockchains as a foundation.
Token holders will be able to vote on proposals submitted to the DAO and determine how development and governance decisions will proceed in the future. According to Goldfeder, this will further decentralize both the development and the decision-making process for the future of blockchains. The tokens will be dropped on March 23rd.
“Looking forward, we are moving closer and closer to a decentralized financial system, with Arbitrum technology at the forefront of that,” Goldfeder added.
Offchain Labs Arbitrum is building Layer 2 scaling solutions for Ethereum, which use “rollups” technology to speed up transactions and reduce fees. Layer 2 solutions perform transitions outside of Ethereum on their own blockchain and batch them together so they can be “rolled together” before sending them back to Ethereum so they can all run simultaneously.
Arbitrum One is the leading Layer 2 scaling solution for Ethereum with around $1.67 billion in total assets locked in the chain, according to DefiLlama. Offchain Labs raised $120 million in funding in August 2021 to launch the Arbitrium One network, and the scaling solution was chosen by internet giant Reddit for its blockchain-based “Community Points” program.
Along with the new foundation and DAO, Offchain Labs also announced a new technology called Arbitrum Orbit – a Layer 3 scaling solution that allows developers to build their own scaling chains that will roll onto Arbitrum.
With Orbit, developers will gain access to permissionless scalable blockchains that behave like Arbitrum’s other blockchains. For example, they can build Layer 3 Rollup chains with Ethereum-level security to maximize scalability similar to Arbitrum One, or they can aim for Layer 3 AnyTrust chains with minimal trust to enable high volume and low transaction costs similar to Arbitrum Nova. All of these solutions run on top of Arbitrum Nitro’s core engine, meaning developers can customize their own Layer 3 solution for their application-specific needs.
The new scaling solution fully supports the Ethereum virtual machine, meaning developers can write and execute smart contracts. The company also said it will also support the upcoming release of Arbitrum Stylus, which will allow developers to use programming languages such as C, C++ and Rust for their chains, in addition to the traditional Solidity coding language for writing code for dapps.
“The launch of Arbitrum Orbit marks another step in the goal of growth through ecosystem expansion by bringing in new developers,” Goldfeder said. “With today’s announcement, developers now have another tool that allows them to not only build their own smart contracts, but also launch their own L3 chains that leverage the best technology available.”
