Coinbase on Layer 2 is Latest in Ethereum Scaling Boom
There’s been an explosion of Ethereum scaling developments this past week, with the latest and arguably biggest one announced yesterday: Coinbase Wallet is integrating with Optimism’s Optimistic Rollup testnet. Coinbase Wallet is the US exchange’s non-custodial wallet and dapp browser (not the exchange itself) and the integration will allow users to view their balances and …
By: Camila RussoDeFi News
There’s been an explosion of Ethereum scaling developments this past week, with the latest and arguably biggest one announced yesterday: Coinbase Wallet is integrating with Optimism’s Optimistic Rollup testnet.
Coinbase Wallet is the US exchange’s non-custodial wallet and dapp browser (not the exchange itself) and the integration will allow users to view their balances and send transactions on Optimism’s testnet, according to the post.
Exchanges and dapps moving into Layer 2 solutions that enable increased throughput and reduce congestion on the Ethereum network, will be key for Ethereum’s long-term growth. Even with today’s niche user base, gas fees and confirmation times skyrocketed at the height of the yield farming craze, to the point of pricing out anyone transacting with smaller amounts.
Coinbase is the second major centralized exchange after Bitfinex to announce plans to take part of their transactions off the Ethereum main chain. Bitfinex is in the process of integrating with OMG’s off-chain scaling solution called More Viable Plasma.
Layer 2 scaling solutions are technologies that remove some of the computation that’s on-chain (Layer 1) and take it off-chain, so that the network can be faster. Optimism uses Optimistic Rollups, one of these Layer 2 solutions.
Synthetix on Optimism
Synthetix, which had announced the first phase of its integration with Optimistic Ethereum in May, yesterday said it’s moving to phase two of its integration, which will trial the migration from Layer 1 to Layer 2.
And while Optimism’s announcements are for its testnet, there are live scaling solutions supporting Ethereum dapps right now. Value transacted on them is booming, though still relatively low.
Scaling is Live
Value deposited in Loopring, a DEX built using zkRollup scaling tech, is up by 70% to $17M in the past 90 days. Funds in the xDai sidechain have jumped from less than $500k to over $2.5M in that time as an increasing number of applications, from POAP to Foundation are using the network.
In addition to Coinbase and Synthetix announcements, here’s a run down of the past week’s scaling developments:
Aztec 2.0 is a zkRollup-based Layer 2 network, that’s live on Ropsten. ERC20 transactions are private by default and validated on-chain.
Matter Labs released a Layer 2 smart contracts testnet based on zkSync technology, with Curve Finance as the first resident dapp.
Quickswap, a permission-less DEX based on Ethereum, launched on Matic Network’s Layer 2, an adapted version of Plasma with PoS based side chains.