Arbitrum | Trading Non Stop

What is ARB?

Arbitrum is a top Ethereum Layer 2 scaling solution that uses optimistic rollups to make transactions faster and cheaper, while still relying on Ethereum’s strong security.

Ethereum scaling – Handles transactions off the main Ethereum network to lower fees and reduce traffic.
Decentralized governance – ARB token holders vote on updates and how funds are spent.
Ecosystem growth – Supports decentralized finance (DeFi), NFTs, and institutional uses like tokenized stocks.

Deep Dive

1. Purpose & Value Proposition

Arbitrum solves Ethereum’s scalability challenges by moving much of the transaction work off-chain using optimistic rollups. This approach can cut gas fees by up to 90% compared to the main Ethereum network, while still working seamlessly with Ethereum smart contracts. The goal is to make decentralized apps (dApps) faster and more affordable without sacrificing security, helping bring blockchain technology to everyday users (Arbitrum DAO docs).

2. Technology & Architecture

Arbitrum uses optimistic rollups, which bundle many transactions off-chain and send a compressed summary back to Ethereum. Key features include:

Nitro stack: Improves speed and reduces delays.
ArbOS: A custom system that runs rollup transactions (for example, ArbOS 40 added native account abstraction).
Fraud proofs: Validators can dispute incorrect transactions within a 7-day period to keep the system secure.

3. Tokenomics & Governance

ARB is a governance token with a fixed supply of 10 billion tokens. It is not used to pay transaction fees. Token holders have control over:

Protocol upgrades, which require a 13-day waiting period through the Core Governor.
Managing treasury funds (42.78% of tokens) for grants and ecosystem development.
Electing a 12-member Security Council that can act quickly in emergencies.

Conclusion

Arbitrum blends Ethereum’s security with a scalable system, all governed transparently by ARB token holders through on-chain voting. Its future success depends on balancing technical improvements with community input. As Arbitrum grows into areas like Robinhood’s tokenized stocks, how will decentralized governance evolve to meet new challenges?