Arbitrum is a scaling solution for the Ethereum blockchain that aims to speed up transaction times and cut fees on the network. It does so by using a layer 2 solution, which means it operates on top of the Ethereum blockchain and allows for off-chain transactions. Arbitrum is able to lower network congestion and transaction costs by offloading as much work and data storage as possible from Ethereum's main chain or layer 1 (L1). By completing a significant portion of the transaction processing on Arbitrum’s secondary layer and then recording the results on the Ethereum main chain, the speed and efficiency of the system are greatly improved. Interacting with Arbitrum feels very similar to using Ethereum!

Arbitrum functions as an Optimistic Rollup: a type of layer 2 scaling solution that works by allowing transactions to be validated and executed off-chain, and then periodically "rolled up" onto the main blockchain in a single, compact transaction. This process allows for higher transaction throughput and lowers fees, as the main blockchain is not being bogged down by the validation and execution of individual transactions.

The graphic below explains Optimistic Rollups by using a real-world example:

While Arbitrum’s design alleviates some of the congestion and scalability issues that have plagued the Ethereum network in recent years, there are several other solutions that offer similar functionality. Arbitrum stands out from the rest due to its unique features, including:

Arbitrum is designed to be compatible with the Ethereum Virtual Machine (EVM), meaning that Arbitrum is able to execute smart contracts written in Solidity, the programming language commonly used to write smart contracts on Ethereum. By being EVM compatible, Arbitrum allows developers to easily migrate their existing Ethereum-based applications to the Arbitrum platform without the need to rewrite their code. This helps reduce the barriers to adoption for developers who are already familiar with Ethereum and the EVM.

Arbitrum is able to offer fees that are a fraction of that of Ethereum by utilizing its innovative scaling solution. By bundling transactions together, Arbitrum reduces the number of transactions that need to be processed on the main chain, which in turn lowers the fees associated with those transactions.

Arbitrum is focused on minimizing the barriers to entry for developers looking to build on their platform. With its robust developer tooling, Arbitrum enables engineers to write, test, and deploy their applications with ease. Developers looking to build on Arbitrum also enjoy the added benefit of being able to use programs and tools that they’re already familiar with on Ethereum.

The Arbitrum platform has a rapidly growing DeFi ecosystem that includes a range of decentralized applications and protocols. For teams looking to build on Ethereum, Arbitrum offers a fast and low-cost alternative with equally capable processing capabilities. Some examples of applications and protocols that are part of the Arbitrum ecosystem include lending and borrowing platforms, decentralized exchanges, and prediction markets.

If you’re looking to explore the leading projects on Arbitrum, a great place to start is the Arbitrum Portal, “Your gateway into the Arbitrum ecosystem”. ****On the Portal, you can discover and access the various decentralized applications building on Arbitrum across all the DeFi primitives. Transactions on the Arbitrum platform require a small amount of the gas to be paid as a fee, in ETH.

Several of the leading wallets on Ethereum also include support for Arbitrum.

MetaMask, the leading Ethereum wallet, supports several other networks, including Arbitrum. To add Arbitrum on MetaMask, you need to provide some network data:

Once you’ve submitted the information above, switch your current network to Arbitrum, and then you’re ready to go!