Binance Completes Optimism Network Integration to Solve Scalability Issues

by
Blockchain
Binance Completes Optimism Network Integration to Solve Scalability Issues

Following the announcement of the completion of its integration with its Optimism Network, Binance has opened deposits for ETH on Optimism Layer 2. This new feature allows users to make layer 2 ETH deposits.

Solving the Scalability Issue

“Binance will open withdrawals for ETH on the Optimism Network once there are sufficient assets in our wallet. No further announcement will be posted, “the crypto exchange posted on its official website.

Due to the emergence of decentralized finance(DeFi) and the increasing number of transactions on the Ethereum network, costs have risen significantly. This has been caused by various factors, such as the volatility of the market and the emergence of a new yield farm.

The rise of cryptocurrencies and blockchain-based solutions such as Arbitrum, Optimism, and Polygon solved some of the most critical issues related to scalability. These solutions reduce the costs associated with running a blockchain transaction.

The costs associated with blockchain transactions are essentially the processing and storing costs. Essentially, these solutions take the work off of the expensive mainnet. Upon completing a series of transactions or crypto operations, the results of these activities (who owns which coins and how much, for example) are then sent to the mainnet and secured. 

As a result, they reduce the amount of information a base layer blockchain needs to validate and secure. For instance, the gas cost of Optimism is 98 times cheaper than that of Ethereum.

Arbitrum is currently leading the race for the Layer 2 supremacy with a total value of almost $2.96 billion. In contrast, the rival project, Optimism, is valued at around $500 million and is continually gaining attention due to the recent launch of the OP token. There are also rumors that Arbitrum could follow in the footsteps of OP and launch its token in the future.

ETH Merge Still Coming

While the rise of the layer two space has been impressive, there is also a significant transition taking place in the world of Ethereum. This year, the company is expected to complete its long-awaited merge with Proof-of-Stake, which will allow it to compete with other blockchains.

It’s believed that the update will be released in August. The development of the new version has already started, and it will be released on the Ropsten testnet on June 8.

On April 11, Tim Beiko, a developer for Ethereum, revealed that they had once again delayed the proposed merge. He noted that the project would not be released in June. Beiko also said that the developers would need to implement a new update to prevent the project from getting stuck in a difficulty bomb.

If the merge is successful, it will be the last major milestone in the roadmap of Ethereum, which was previously known as Eth2. It will allow the network to upgrade its sharded chains in early 2023. The network will still rely on the existing layer-2 networks such as Optimism and Polygon to handle high transaction volumes.

Binance Losses?

The news about Binance’s investment in the Luna cryptocurrency has been exciting. In April, the company had around $1.6 billion worth of the token. However, since the price of the coin has dropped almost 99% in the past week, the value of the investment has increased to around $3000.

Despite the company’s losses, CEO Changpeng Zhao stated that he still wants to make sure that the retail investors who lost money during the cryptocurrency crash are compensated. He added that the company would ask the Terra project team to make a particular compensation payment to the retail investors to lead by example.

Like Luna, TerrraUSD also experienced a significant price drop. Other cryptocurrencies such as Bitcoin and Ethereum also traded near 18-month lows and are trying to recover.

Adam Robertson

Adam is outgoing young lad who likes adventures and discovering new things. Despite his boring life, He loves writing about cryptocurrencies and exploring what blockchain technology can do for the coming digital world where all adventures will be virtual.