It has been reported that the layer 2 (L2) solution has saved users of the Ethereum network over $1 billion in gas fees. The funding will be used to expand the Optimism team and go toward working on reducing network fees even further.
However, fees on the Optimism network were reduced by a cumulative 30% last year. The team is now contributing work toward an Ethereum Improvement Proposal (EIP-4844) for Shard Blob Transactions, which may potentially reduce Ethereum network fees by up to 100x in the near future.
The report said that L2 solutions like Optimism have grown massively in popularity due to the increased demand for nonfungible tokens (NFTs), smart contracts, and decentralized finance (DeFi) applications on the Ethereum network, which in turn congests transaction processing and drives up gas fees.
Likewise, Optimism works by employing “optimistic rollups,” which aggregates transactions outside of the Ethereum blockchain and provides benefits of reduced slippage, decreased transaction costs, and vastly improved transaction speeds. According to the data tracker, L2Beat, the total value locked (TVL) on L2 platforms has grown to $5.76 billion, with Optimism currently ranked in fourth place among its L2 peers with around $440 million in TVL on its platform.
Kain Warwick, the Australian crypto veteran and founder of Synthetix, a decentralized derivatives exchange, told his 107,000 Twitter followers that he not only participated in the Optimism funding round, he “doubled down hard,” expecting Optimism to “be up there with ETH in size soon.”
Last year, Optimism expanded from its whitelist-only status and made the network publicly accessible, meaning that any developer could start building a project on the Optimism network. Making network development publicly available offers some major upsides in terms of increased output but, as iOS jailbreak developer Saurik discovered, it also allows the potential for “critical bugs” to occur.
Thus, Jay Freeman, also known as Saurik, discovered one such bug in early February, which would have allowed malicious hackers to create infinite ETH on the network, and notified the Optimism team. He was paid a $2 million bug bounty, one of the largest bounties to date.