What is Arbitrum (ARB)?

Deep Dive

1. Purpose & Value Proposition

Arbitrum addresses Ethereum’s high fees and slow speeds by moving most computation off-chain via optimistic rollups, which batch transactions and submit proofs to Ethereum. This allows faster, cheaper transactions (often 90%+ cheaper than Layer 1) while inheriting Ethereum’s security. Its core mission is to scale Ethereum without compromising decentralization.

2. Technology & Architecture

Arbitrum uses optimistic rollups that assume transactions are valid unless challenged, reducing on-chain verification costs. Key innovations:
- Nitro Upgrade: Improved throughput and reduced latency by optimizing data compression and fraud-proof systems.
- Stylus: Enables developers to write smart contracts in Rust, C++, and other languages alongside Solidity, broadening accessibility.
- Orbit: A Layer 3 framework allowing developers to launch customizable chains atop Arbitrum, tailored for specific use cases like gaming or DeFi.

3. Governance & Ecosystem

The ARB token powers governance through the Arbitrum DAO, where holders vote on protocol upgrades, treasury allocations, and Security Council elections. The ecosystem hosts 900+ dApps (Uniswap, GMX) and spans DeFi, NFTs, and real-world assets. Partnerships like Robinhood’s integration highlight its role in bridging TradFi and DeFi.

Conclusion

Arbitrum combines Ethereum’s security with scalable infrastructure, governed by a decentralized community. As Layer 2 adoption grows, can Arbitrum maintain its lead against competitors like Optimism and zkSync?