Ethereum ETH

Off Chain Labs raises $120 million in founding round as Arbitrum launches on Mainnet

  • Arbitrum is a layer 2 scaling solution that promises to process many more transactions than Ethereum at a lower cost
  • Users will now be able to interact with the apps build by their partners such as Chainlink, Uniswap, and Alchemy
  • Off Chain labs also managed to raise $20 million in Series A funding in April this year and $100 million in Series B funding shortly after

Ethereum scaling solution developer Off Chain Labs , has launched its mainnet, called Arbitrum One. The company has also raised $120 million in a Series B funding round.

Users can now interact with apps launched on Arbtrium

Arbitrum is a layer 2 scaling solution that promises to process many more transactions than Ethereum at a lower cost. It processes transactions on a side chain using optimistic roll-up technology, then regularly settles them on the main Ethereum blockchain. Before this launch, only developers could launch and test their apps on Arbitrum, but now users can interact with the apps.

The scaling solution attracted well-known partners such as Uniswap Alchemy and Chainlink, who were early supports of the project. The company also managed to attract investor interest, raising $20 million in Series A funding in April this year and $100 million in Series B funding shortly after, led by Lightspeed Venture Partners, which closed this month and values the company at $1.2 billion. Other new investors include Polychain Capital,  Alameda Research, Redpoint Ventures, Panthera Capital, Ribit Capital, and Mark Cuban.

Arbitrum is not the only scaling solution on Ethereum

In the Ethereum community, Arbitrum and Optimism are recognized as the most promising scaling solutions for DeFi. This is because they use so-called Optimistic Rollups. However, Optimism has a different approach than Arbitrum, which makes them different. This difference lies in their respective fraud-proof login. Optimism limits the size of smart contracts to what can be re-executed on Ethereum, while Arbitrum allows users to break smart contracts into pieces and prove fraud at the level of a single contract instruction.

Another solution is the Polygon sidechain, which is technically not a scaling solution, but a blockchain independent of Ethereum mainchain. However, since it uses the same virtual machine as Ethereum, it can communicate with the Ethereum mainchain. Once on the chain, you benefit from the low transaction costs of the Polygon network. Moreover, transferred tokens can be used in all decentralized applications supported by Polygon.

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