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Nansen: Data Explains Arbitrum Q2 Network Status

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With Arbitrum Nitro coming soon, developers can look forward to a more seamless experience by using Geth instead of the custom-designed language Arbitrum Virtual Machine (AVM). the

Original title: "Nansen: Graphical Arbitrum's Key Network Data for the Second Quarter"

Original Source: Nansen

Overview

Optimistic Rollups

Arbitrum is an Optimistic rollup, one of many scaling solutions for the Ethereum blockchain one. Optimistic Rollups assume validators are not malicious and transactions are issued correctly. To ensure the assertion is valid, anyone can challenge the validity of the transaction claim for about a week. The dispute is then narrowed down to a single-line instruction and executed on the L1 chain to verify correctness. Fraudulent nodes will have their staking share slashed, a portion of which will be distributed to the winners of the challenge. The process of providing evidence of an incorrect state transition is called fraud proof. This is the basis of how Optimistic rollups like Arbitrum work, reducing the workload on the main L1 chain as not all transactions need to be re-executed and incentivizing nodes to behave well.

Nansen: Diagram Arbitrum's key network data in the second quarter

Ecosystem

Arbitrum has a dynamic ecosystem of dApps and tools that can be viewed in the Arbitrum One Portal directory. Effective August 12, 2022, Tracer DAO will be renamed Mycelium.

With Arbitrum Nitro coming soon, developers can look forward to a more seamless experience by using Geth instead of the custom-designed language Arbitrum Virtual Machine (AVM) . The team expects on-chain throughput to increase while fees decrease, allowing more teams to further build on the current ecosystem.

Key development: 2022 Q2

Arbitrum Nitro

On July 16, 2022, Offchain Labs published a report on upgrading Arbitrum One to the Nitro tech stack following a successful migration to the Rinkeby testnet next month.

Arbitrum Nitro introduces some changes to the current AVM architecture and ArbOS. The popular WebAssembly (WASM) architecture will replace the older, custom-designed AVM architecture. The custom EVM emulator will also be replaced by Geth, one of the most popular software clients for running Ethereum nodes. Finally, ArbOS will be reduced in size and rewritten in Go, providing a more optimized batching and compression system for transactions. With these upgrades to Nitro, the Arbitrum team expects a 7x increase in throughput while significantly reducing fees.

Arbitrum Odyssey

Arbitrum Odyssey announces partnership with Project Galaxy (a web3 credentialed data network) and Illustrator Ratwell collaborated with Sugoi. This is an interactive exploration through the Arbitrum ecosystem, where users will perform several on-chain tasks and navigate the various dApps on the Arbitrum chain to earn some exclusive NFTs. The program is scheduled to run for nine weeks, culminating in the final Arbi NFT; however, the Arbitrum Odyssey has been put on hold pending the Nitro upgrade to go live on mainnet. According to the tweet, users who have completed quests so far will still have progress throughout the journey.

Arbitrum Nova – AnyTrust Chain

AnyTrust technology is based on a minimum trust ensured through the Data Availability Committee assumption. This committee will be responsible for managing off-chain transaction data and providing that data to support batches. Signing Data Availability Certificates (DACerts) for batches of transactions and publishing this DACert instead of all transactions results in smaller storage requirements on the L1 chain and cheaper transaction fees. DACert will also be the statement that the committee is responsible for providing batch data upon request. If the committee is unable to reach a consensus, the chain will revert to the Arbitrum rollup protocol. Data execution will be performed on the L2 chain, and after a challenging period, the new aggregated state will be confirmed on Ethereum. Similar to the way Arbitrum One was built based on Arbitrum Rollup technology, Arbitrum Nova is a new chain built on AnyTrust technology that will be launched with Nitro. It is fully compatible with the EVM, and development on either chain will be as seamless as possible. It is more suitable for cost-sensitive gaming and social applications, which have higher transaction volume and frequency.

Nansen on-chain data

Daily transaction volume

Nansen: Graphical Arbitrum Q2 network key data

Transaction volume on Arbitrum has remained in the range of 40,000 to 100,000 transactions per day , there was a sharp upward trend from June 26 to June 28. Gas on Arbitrum follows a similar pattern. During the UST decoupling event on May 12, gas increased dramatically while transaction volume decreased. In contrast, the second gas spike on June 28 increased the number of transactions accordingly, likely due to Arbitrum Odyssey pausing at the end of Q2 2022 to incorporate the Nitro upgrade from their most recent tweet.

Daily transaction volume VS Ethereum

Nansen: Illustrated Arbitrum's second quarter network key data

Source: Nansen

Comparing the number of transactions with the number of transactions in Ethereum, the number of transactions in Ethereum The volume is high, but the transaction volume of both chains fluctuates sideways, with Arbitrum and Ethereum hovering between 100k - 200k and 1m - 1.2m respectively. Interestingly, between June 19th and June 28th, the transaction volume on Ethereum decreased, while the transaction volume on Arbitrum increased, the same period as Arbitrum Odyssey. This could be an opportunity for when the Arbitrum Odyssey will recover after the Nitro upgrade.

Smart Money on Arbitrum

Nansen: Illustrated Arbitrum's key network data for the second quarter

Source: Nansen

Following up on the address marked as Smart Money on Ethereum, this chart The proportion of such addresses on Arbitrum is also shown. Airdrop Pro labels have by far the highest percentage of overlapping addresses, suggesting that many wallets may be waiting for Arbitrum to follow in the footsteps of Optimism, which released its native token earlier this year.

Top Projects by Number of Users and Number of Transactions

Nansen: Diagram of Arbitrum's key network data in the second quarter

Nansen: Illustrated Arbitrum's second quarter network key data

In addition to Smart Money, we can also use Nansen tags to analyze the top project parties that are interacting with Arbitrum based on the number of users and the number of transactions on Arbitrum. Many of the project parties shown here are part of the Arbitrum Odyssey and may indicate the effectiveness of this campaign in guiding users to interact with the dApps offered in the Arbitrum ecosystem. Besides Swap transactions and cross-chain bridges, GMX and Treasure stood out as interesting projects contributing to Arbitrum’s transaction volume. Finally, the "unknown" listed at the top refers to the sum of all unlabeled entities, not a single unknown party.

Famous project parties on Arbitrum

GMX

GMX is a decentralized spot and perpetual exchange offering low swap fees and zero price impact trading. Trading is backed by a multi-asset pool that earns fees from market making, leveraged trading, and swap fees. Its pricing is supported by Chainlink oracles as well as aggregated prices from major exchanges. The inclusion of GMX in the Arbitrum Odyssey and strong incentives for stakers and liquidity providers has resulted in increased transaction volume and attention for GMX. Additionally, since GMX is deployed on both chains, Avalanche and Arbitrum, GMX is able to tap into different communities and take advantage of the low fees of both chains.

Treasury

Treasure is a decentralized NFT centered on a Metaverse project on Arbitrum ecosystem. Each project listed uses the token MAGIC, Treasure’s native token, in its respective ecosystem, full of lore and community. Trove, an NFT marketplace built around the Treasure ecosystem, extends Treasure's well-known brand and officially launched its alpha version, which embodies a wider range of NFTs from art, photography and music. Trove also aims to gamify the marketplace experience by creating a "game world" that allows collectors and builders to express themselves freely through their assets, community, and shared experiences.

Conclusion

Despite the depressed market sentiment, the Arbitrum team was able to engage with users through Arbitrum Odyssey, Explore its vibrant ecosystem and reward them along the way. Coupled with Nitro and Nova's upcoming infrastructure upgrades, Arbitrum solidifies its position as a developer playground and demonstrates its potential as an Ethereum chain scaling solution with higher throughput and lower fees .