Popular Ethereum scaling solution Optimism announced a $150 million Series A funding round, co-led By Andreessen Horowitz and Paradigm. The total value of the round is $1.65 billion.
Optimism claims that layer 2 (L2) has reduced the cost of gas for users on the Ethereum network by saving them over $1 billion. This funding will be used for expanding the Optimism Team and going towards reducing network fees further.
Last year, fees for the Optimism Network were reduced by 30%. This team is currently working on an Ethereum Improvement Proposal EIP-484 for Shard Blob Transactions. This proposal could potentially lower Ethereum network fees up to 100x.
We strongly support the EIP because it has the potential to reduce fees by 100x for all rollsups and offers a practical path to implement.
You may be wondering how?
— Optimism (@optimismPBC)
March 4, 2022
L2 solutions such as Optimism are gaining popularity because of the increased demand for smart contracts, nonfungible tokens (NFTs), and decentralized finance applications (DeFi) on the Ethereum network. This in turn congests transaction processes and drives up gasoline fees.
Optimism is achieved by using “optimistic rollsups”, which aggregate transactions outside of Ethereum. This provides the benefits of lower slippage, reduced transaction costs, and greatly improved transaction speeds.
L2Beat data tracker says that the total value of L2 platforms has risen to $5.76 Billion. Optimism is currently ranked fourth among L2 peers, with approximately $440 million in TVL.
Kain Warwick, an Australian crypto veteran and founder Synthetix, a distributed derivatives exchange, said to his 107,000 followers on twitter that he participated in the Optimism financing round. He also stated that he “doubled up hard” expecting Optimism “to be up there with ETH soon.”
Disclosure: I was a participant in the current round, but I doubled down. This is my portfolio sorted by size:
I expect Optimism to be up there with ETH in size soon, I wonder what the catalyst might be… https://t.co/yBw4mBtDz4
— kain.eth L222 (@kaiynne)
March 17, 2022
Optimism, which was previously whitelisted, has been made publicly available. This means that anyone can build a project via the Optimism network.
Public access to network development has major benefits in terms of increased output, but as iOS jailbreak developer Saurik discovered it also opens the possibility for “critical bugs”.
Jay Freeman, also known by Saurik, found a bug that would have allowed malicious hackers unlimited ETH on the network in February. He notified the Optimism group. He received a $2 million bug bounty. This is one of the highest bounties ever.