Layer 2 Network Trades At $13B Fully Diluted Valuation
Almost four hours after ARB was launched, nearly half of the more than 600,000 eligible wallets have claimed Arbitrum’s long-awaited token.
Those wallets account for about half the 1.15B claimable tokens, and ARB is trading at $1.30 as of midday New York time.
The frenzy of activity briefly pushed Arbitrum to its limit Thursday morning, with the claims website crashing and transaction fees on the blockchain — usually around $0.10 — briefly spiking 30x to above $3.
Arbitrum witnessed record activity on Wednesday when it processed more than 1.2M transactions.
The ordeal Thursday morning is a reminder that even leading technology meant to scale Arbitrum has a long way to go before it can accommodate a mass audience.
Arbitrum and competing Layer 2 blockchains, like Optimism and zkSync, are built to scale Ethereum — to enable it to handle more transactions, at a lower cost. They achieve this by bundling, or rolling up, transactions and submitting them in batches for validation on Ethereum.
It’s not the first time Arbitrum has buckled under pressure.
The blockchain’s transaction volume spiked in June with the launch of its Odyssey program, which rewarded users with NFTs for activity on the network. The event was rumored to culminate in an airdrop for participants, inspiring many airdrop opportunists to join in on the action.
However, the surge in activity caused problems for the network, with transaction fees briefly exceeding those on Ethereum’s mainnet, prompting Offchain Labs to pause the program.
Co-founder and Chief Technology Officer Harry Kalodner previously told The Defiant that research and development resources at Arbitrum parent company Offchain Labs are now focused on doing for Arbitrum what Arbitrum has done for Ethereum: getting it to handle more transactions at a lower cost.
Arbitrum Co-Founder Says Ability to Process Transactions is Finite
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Arbitrum took a step toward that goal on Thursday, when, in addition to ARB, it launched a program intended to help development teams create Layer 3 blockchains on top of Arbitrum.