Beginner’s Guide to Arbitrum
What is Arbitrum?
Arbitrum is an Ethereum scaling solution based on optimistic rollups that aims to feel exactly like interacting with Ethereum, but with transactions costing a fraction of what they do. It is built by the team at Offchain Labs.
Why is there a need to build Arbitrum?
Ethereum is expensive to use.
A swap on Uniswap costs US$30 and a simple token transfer can cost $10. Furthermore, these gas prices aren’t set in stone and they can fluctuate wildly especially during periods of high demand.
As more users demand for precious block space on Ethereum, a number of scaling solutions are being explored outside of the main protocol layer. These include sidechains, channels, rollups and more.
Rollups are a way to scale Ethereum by moving the execution layer of transactions away from the main blockchain and rolling the transactions up in batches. Often, they compress the data and verify them off-chain before storing the state data on the main chain.
