The optimism network has achieved a significant milestone by surpassing Arbitrum in transaction volume for the first time in six months. This victory signals a shift in the dominance of layer 2 solutions built on top of Ethereum. Both Optimism and Arbitrum utilize optimistic rollup technology, which optimizes and batches transactions to reduce fees on the Ethereum network.
A Tale of Seasons and Tokens
January marked the turning point for Optimism as it temporarily fell behind Arbitrum in terms of transaction volume. The conclusion of season one of Optimism’s “quest” feature played a role in this setback. However, the tables turned on July 25 as Worldcoin made its debut, propelling Optimism back to the top.
When examining the transaction volume from August to December 2022, both networks exhibited similar levels. In December, Optimism surged ahead but faced a setback in January. This aligns with the timing of Optimism’s “quest” feature, an incentive program that rewarded users for on-chain activities. Arbitrum experienced a notable boost in March with the launch of its native Arbitrum (ARB) token and an airdrop to users.
Optimism’s Uphill Battle
Despite Optimism’s recent surge, it still trails behind Arbitrum in terms of total value locked (TVL), which reflects the capital deposited into their contracts. According to DefiLlama, Optimism has a TVL of only $923 million, whereas Arbitrum boasts over $2 billion. While the transaction volume victory is significant, Optimism has room for growth in attracting more capital to its platform.
Worldcoin Launch and Coinbase’s Influence
The introduction of Worldcoin on Optimism played a pivotal role in driving transaction numbers even higher. From July 23 to 26, there was a staggering increase of nearly 65% in Optimism transactions, elevating the network to the top spot. Additionally, the upcoming launch of Coinbase’s Base network, which will be connected to Optimism as part of an upcoming “Superchain,” may fuel further growth and adoption.
Optimism’s recent triumph over Arbitrum in transaction volume demonstrates its ability to compete in the fiercely competitive layer 2 landscape. While it still faces challenges in terms of total value locked, Optimism’s momentum is undeniable. With the launch of Worldcoin and the promising partnership with Coinbase, Optimism’s future appears bright as it continues to innovate and attract users to its platform.