Optimism Saves Users $1B in Fees, Raises $150M in Series B Funding

Popular Ethereum scaling solution Optimism has announced a $150 million Series B round co-led by Andreessen Horowitz (a16z) and Paradigm at a total valuation of $1.65 billion.

According to Optimism’s blog post, this layer 2 (L2) solution has saved users of the ethereum network over $1 billion in gas fees. The funds will be used to expand the Optimism team and further work on reducing network fees.

Last year, the Optimism network saw a cumulative 30% reduction in fees, and now the team is contributing to the Ethereum Improvement Proposal (EIP-4844) for Shard Blob Transactions, which could reduce Ethereum network fees by a factor of 100 in the near future.

Today at Ethereum #AllCoreDevs, our very own @protolambda presented EIP-4844: Shard Blob Transactions.

We strongly support this EIP due to the potential to reduce all rollup fees by a factor of 100 and a practical path to implementation.

But you ask, what's going on here?

— Optimism ✨ (@optimismPBC) March 4, 2022

L2 solutions like Optimism have exploded in popularity due to increased demand for NFTs, smart contracts, and DeFi applications on the Ethereum network, which in turn congests transaction processing and drives up gas fees.

Optimism works by using "optimistic rollups," which aggregate transactions outside of the Ethereum blockchain, offering the benefits of reduced slippage, lower transaction costs, and greatly increased transaction speed.

According to the data tracker, L2Beat's total value locked (TVL) on the L2 platform has grown to $5.76 billion, and Optimism currently has a TVL of about $440 million on the L2 platform, ranking fourth among its peers.

Kain Warwick, an Australian crypto veteran and founder of decentralized derivatives exchange Synthetix, told his 107,000 Twitter followers that not only was he involved in the Optimism funding round, but that he’s “doubling down” that Optimism “will reach ETH soon.” scale."

I played this round after the previous round, but I doubled down on the bets. My portfolio now looks like this:

SNX

ETH

ILV

GRT

BTC

OP (optimism)

I expect Optimism to catch up to ETH in scale soon, I wonder what the catalyst might be...  

— kain.eth L222 (@kaiynne) March 17, 2022

Late last year, Optimism expanded its whitelist status and opened up the network to public access, meaning any developer can start building projects on the Optimism network.

Bringing web development into the open can increase output, but it can also lead to "critical vulnerabilities," as iOS jailbreak developer Saurik discovered.

Fortunately, Saurik (real name Jay Freeman) discovered one such vulnerability in early February, which would allow malicious hackers to create infinite ETH on the network, and notified the Optimism team. He was awarded a $2 million bug bounty, one of the largest to date.