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Arbitrum: A Leading Ethereum Layer 2 Scaling Solution

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by Giorgi Kostiuk

2 years ago


Arbitrum, an Ethereum layer 2 scaling solution, utilizes optimistic rollups to enhance its capabilities. It leverages Ethereum's security while offering higher throughput and lower fees compared to Ethereum. Moreover, Arbitrum supports unaltered EVM contracts, enabling seamless operation of any Ethereum dApp on the platform without requiring any code modifications. Developers also have the flexibility to write programs in widespread languages such as RUST or C++.

Arbitrum's market-leading roll-up technology employs fraud proofs to reduce transaction fees, enabling scalability. The protocol's orbit chains are fully permissionless, providing dedicated throughput and enhanced gas fee reliability. Additionally, the Any Trust chain settles on Ethereum, facilitating secure Web 3 gaming opportunities. The recent surge in Arbitrum's unique addresses and transaction volumes underscores its growing popularity in the ecosystem.

Arbitrum's official token, ARB, holds a total supply of 10,000,000,000 ARB, with 28.9% currently in circulation. The protocol boasts 1,206,093 holders, with a slight increase in recent days. Investors hold 26.39% of the token supply, while the team and advisors control over 40.5%. Notably, the Arbitrum Foundation and its associated wallets possess more than 36% of the token supply, reflecting a significant stake in the ecosystem.

The surge in unique addresses by over 163k within 24 hours highlights Arbitrum's rapid growth trajectory. Daily transactions on the platform have also surged by approximately 8% in the last 24 hours. Despite the total value locked (TVL) declining slightly to $3.01 Billion from its peak, Arbitrum remains competitive with around 40 core developers, surpassing many of its peers.

In terms of price action, ARB's market capitalization stands at $2.7 Billion, ranking it 40th in the cryptocurrency market. The token price, currently at $0.944, has experienced a 5% drop over the past year. Technical analysis indicates a bearish trend with the token trading below the 50 and 100 Exponential Moving Averages (EMA). The potential price support and resistance levels are identified around $0.85 and $1 respectively.

In conclusion, Arbitrum's expanding TVL, growing transaction volumes, and unique addresses signal its increasing adoption and development progress. While the ARB price is currently consolidating, there is potential for a price increase in the future, driven by the platform's robust ecosystem and market demand.

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