What is Arbitrum? Learn from A to Z leading Layer 2 scaling solutions
The Arbitrum project went live in beta at the end of May 2021 and officially on the Mainnet on September 1, 2021. So what is Arbitrum? What's so special about this project? Let's learn about the Arbitrum project with Hay Mod Game
What is Arbitrum?
Arbitrum is a Layer 2 scaling solution aimed at solving congestion problems on Ethereum. Specifically, the project increases their speed and scalability and adds security features to boot. In which, Layer 2 is a technology or system running on Layer 1. Layer 2 inherits the security from Layer 1 and has the ability to process more transactions, reduce costs and have faster transaction confirmation speed. Layer 1.
What is Arbitrum?Arbitrum is designed to address the shortcomings of current Ethereum smart contracts. For example, the efficiency is poor and the cost of implementation is high. This significantly affects the user experience on Ethereum and increases transaction costs.
Arbitrum provides 3 main scaling solutions: Rollup (OPU), Channels and Sidechains.
- Rollups: Similar to advanced, non-custodial Sidechains, capable of greatly expanding the throughput capacity of the Ethereum mainnet. Up to now, there are 4 main types of Rollup: Optimistic Rollups, zkRollups, Plasma, Validium.
- State Channels: Requires users to send Ethereum state snapshots into a Multi-sign Contract. This state contains important data such as the balance of the address. Such a system allows free off-chain transactions with instant completion and superior privacy.
- Sidechains: Independent Blockchains with its own independent consensus rules, where Ethereum transactions can potentially be routed in a supervised manner to reduce the burden on the Ethereum mainnet.
The attention of the entire Ethereum community is on Arbitrum's Rollup (OPU). The other two solutions are still not very informative. Therefore, Hay Mod Game will focus on explaining the Rollup solution provided by the Arbitrum project.
What is Rollup?
Rollup is a type of Layer 2 scaling solution that allows to “roll” sidechain transactions into a single aggregated block and write to the Ethereum blockchain. This makes transaction data on layer 2 available on layer 1 whenever it is needed to validate a state transition.
How does Arbitrum work?
The Arbitrum system is composed of 3 main components:
- EthBridge: Manage inbox/outbox activities and Rollup agreements. It is responsible for saving transaction information in Inbox and this information will be synchronized with ArbOS for implementation.
- AVM execution environment: Implemented on Layer-2, emulating EVM execution environment on virtual machine.
- ArbOS: Executing the emulation process
All transactions in the project are first sent to Layer-1. Then will be transferred to ArbOS for implementation. It does EVM emulation for the most part, and the whole process is done on the AVM. The Arbitrum protocol ensures that code will run correctly as long as all validators are honest, making the network resistant to collusion and other forms of attack.
Simply put, if you want to send a transaction through Arbitrum, you just need to send it to one of the EthBridge contracts called “Inbox”. In contrast, there is an “Outbox” contract that receives data from Arbitrum and adds it to the Ethereum Blockchain. All inputs and outputs to EthBridge are public and verifiable. So Ethereum knows and verifies all Off-chain activities.
Future versions of Arbitrum will also have two other modes: Channels and AnyTrust sidechains.
As with many blockchains, individual nodes can choose to participate in the Arbitrum chain. Validator nodes participate in observing the state of the chain, and full nodes help in aggregating layer 1 transactions. The aggregators who send transactions to the layer 1 chain earn rewards paid in ETH, while the rest of the user's transaction fees are distributed to other network participants – such as validators.
The project introduces a challenge step for rollup blocks, which allows other validators to check the correctness of a block and issue a challenge if they believe it to be false. If a block is proven incorrect or a challenge is proven unreasonable, lying validators will have their stake confiscated, ensuring validators always play fair or risk the consequences. fruit.
The platform also has its own custom virtual machine, the Arbitrum virtual machine (AVM). This is the execution environment for Arbitrum smart contracts and lives on top of EthBridge – a collection of smart contracts that communicate with the Arbitrum chain. Ethereum-compatible smart contracts are automatically translated to run on the AVM.
Advantages of Arbitrum
- High EVM Compatibility: Arbitrum is considered to be one of the most EVM compatible synthesis software. It is compatible with EVM at the bytecode level, and any language that can compile to an EVM will work just fine – Solidity and Vyper for example. This makes it easy to develop, as developers don't need to have a clear understanding of a new language before building on Arbitrum.
- A powerful tool for developers: The Arbitrum development team is working to reduce the barriers to entry when building a layer 2 solution. As a result, they've created comprehensive development documentation for Arbitrum and developers can start using existing tools for Ethereum.
- Low Transaction Fees: As a Layer 2 scaling solution for Ethereum, Arbitrum is not only designed to enhance Ethereum's transaction throughput, but also minimize concurrent transaction fees. Thanks to its extremely efficient rollup technology, Arbitrum is able to cut fees to a fraction of what they are on Ethereum, while still providing enough incentives for validators.
- Fair Launch: Arbitrum has been running several testnets since October and is currently live on the mainnet for developers. Unlike many other Layer 2 scaling solutions, Arbitrum does not have its own native utility token.
Disadvantages of Arbitrum
The “multi-round rollup” approach also makes dispute resolution take longer.
The project is ambitious as it plans to support many other scaling solutions (side chains and Channels), the complex transition between these solutions is an issue and I have not seen the project say much about it yet. .
Arbitrum's Ecosystem
There are 4 main areas in the ecosystem:
- Wallets: Coinbase Wallet, Huobi Wallet, MathWallet, MetaMask, Zapper,…
- Dapps: 1inch, Uniswap, Perpetual Protocol, Dodo, FutureSwap,…
- Tools: Band Protocol. Chainlink, The Graph,…
- Bridges : Ren Bridge, Celer Cbridge, Connext,…
If you want to know more about Arbitrum's ecosystem, you can see more here:
Overview of the Arbitrum ecosystem and important pieces 2022
Tokens of Arbitrum
At the time of writing, Arbitrum has no plans to open a token sale. However, you can still get Arbitrum tokens using the platform and wait for an Airdrop.
Offchain Labs has stated that they have no plans to launch a separate Arbitrum token, meaning that all transaction fees will be paid in ETH even if they are completed in the Arbitrum One mainnet. Since the main goal of this layer 2 protocol is to improve the efficiency of the Ethereum network, reducing congestion in the network could lead to increased adoption of the Ethereum blockchain as the infrastructure on which Dapps will be built. .
Development team and investment funds, partners
Development team
- Ed Felten – Co-founder & Chief Scientist: Formerly Professor of Computer Science and Public Affairs at Princeton University, and has 2 years of experience serving in the White House as Vice President of US Technology and Senior Advisor high for the president.
- Harry Kalodner – Co-founder & CTO : Research on the economics, anonymity, and incentive compatibility of cryptocurrencies.
- Steven Goldfeder – Co-founder & CEO : PhD from Princeton University. And co-author of “Bitcoin and Cryptocurrency Technologies”, the leading textbook on cryptography.
Investment funds and partners
Arbitrum has attracted a number of well-known partners, including Uniswap and Chainlink, who have pledged to support the project soon.
Arbitrum được đầu tư bởi Lightspeed Venture Partners, Coinbase Ventures, Polychain Capital, Ribbit Capital, Redpoint Ventures, Pantera Capital, Alameda Research và Mark Cuban.
Roadmap – Arbitrum project's development roadmap
- Beta 2: Full Release: May 28, 2021
- First mainnet release: Aug 31, 2021
- Sidechain Support Arbitrum: expected in Q1 2022
Bridge between Ethereum and Arbitrum
Arbitrum Token Bridge allows users to move ETH and ERC-20 Ethereum tokens for use on Arbitrum One.
Steps to use Arbitrum Token Bridge to bring tokens from Ethereum to Arbitrum sieve:
- Step 1: Add Arbitrum to Metamask
- Step 2: Access the link here , then select “ Connect Wallet ”
- Step 3: Select the property you want to transfer
- Step 4: Select “ Deposit ” and complete the transaction on Metamask
Through this article, you must have had your own opinions about the Arbitrum project. Hay Mod Game is not responsible for any of your investment decisions. But Hay Mod Game will support you all to understand the basic information and succeed in this extremely potential market!