Arbitrum One Surpasses $10 Billion in Total Value Locked on Ethereum Layer 2 Network
Arbitrum One, a leading Ethereum Layer 2 (L2) network, has achieved a significant milestone by reaching a Total Value Locked (TVL) of over $10 billion, marking a 16% increase over the past seven days. This achievement not only underscores the growing interest and confidence in Arbitrum One but also highlights the platform’s resilience and potential following a partial outage on December 15 due to a surge in Bitcoin Ordinals-inspired inscriptions.
The Composition of TVL
The TVL of $10.22 billion in Arbitrum One showcases a diverse asset composition. It includes Ethereum, the native ARB token, and a substantial proportion of stablecoins. Ethereum comprises 30.9% of the TVL, the ARB token accounts for 23.68%, and stablecoins make up 29.66%, with the remaining 15.76% distributed among various other assets.
Arbitrum One’s Journey and Funding
Arbitrum One, developed by Offchain Labs, has been a prominent name in the Ethereum scaling solution space. The platform launched its public mainnet on August 31, 2021, following the completion of its optimistic rollups solution. This launch was accompanied by a successful Series B fundraising round that amassed $120 million, led by Lightspeed Venture Partners and involving notable investors like Polychain Capital, Pantera Capital, Alameda Research, and Mark Cuban.
Prior to this, Offchain Labs had a significant beta launch in May, allowing developers to start building on the platform. This phase of development garnered attention and support from leading DeFi protocols such as Aave, MakerDAO, Chainlink, and Uniswap. Additionally, the social media network Reddit announced plans to use Arbitrum’s technology for its layer-two rollup.
In terms of funding, Offchain Labs’ journey began with a $20 million Series A in April, followed by the $100 million Series B in August, bringing the company’s valuation to $1.2 billion. The Series B round attracted various new investors, including Ribbit Capital, Redpoint Ventures, and Mark Cuban.
Arbitrum’s rise is not without competition. Other rollup solutions like Optimism are also gaining traction, while the Polygon sidechain maintains a significant presence in decentralized finance with a TVL of around $5 billion.
As reported by Blockchain.News, the total value locked (TVL) in global decentralized finance (DeFi) has surged to $55.365 billion, a significant increase due to increased interest and trust in decentralized finance platforms and technology.
The Importance of Layer 2 Solutions
Layer 2 solutions like Arbitrum One play a crucial role in addressing the scalability issues of Ethereum. By providing a platform for faster and cheaper transactions, they significantly enhance the user experience and broaden the appeal of decentralized applications. This technological advancement is vital for the widespread adoption of blockchain technology and the future of decentralized finance.