Arbitrum is a Layer 2 scaling solution for the Ethereum blockchain. It uses a technology called optimistic rollups to process transactions off-chain, which allows it to achieve much higher throughput and lower fees than the Ethereum mainnet.

In this article, we will learn about the Arbitrum Layer 2 Solution, its native token "ARB," the history of Arbitrum, its features, the value of the ARB cryptocurrency, and provide a step-by-step guide on purchasing ARB coins.

What Is Arbitrum?

Arbitrum is a Layer 2 scaling solution for the Ethereum blockchain, and it has been making waves in the crypto space with its innovative approach to increasing transaction speed on the Ethereum chain and reducing transaction fees. Arbitrum utilizes a technology called optimistic rollups to handle transactions off-chain, resulting in much faster transaction speeds and reduced costs when compared to the Ethereum mainnet.

One of the standout features of Arbitrum is its seamless compatibility with Ethereum smart contracts. Developers can effortlessly deploy their decentralized applications (dApps) to Arbitrum without any modifications, eliminating the need for a steep learning curve or extensive code changes. This compatibility ensures that the existing Ethereum ecosystem can seamlessly transition to Arbitrum, opening up new opportunities for scalability without sacrificing the functionality and security provided by Ethereum's smart contract capabilities.

Unlike other Layer 2 solutions, Arbitrum has undergone extensive testing and refinement over several years. It has proven its reliability and robustness by successfully processing billions of dollars worth of transactions. This battle-tested nature instills confidence in users and developers alike, making Arbitrum a trusted and reliable solution for scaling Ethereum.

Arbitrum presents an innovative solution for scaling Ethereum's Layer 2, effectively tackling the limitations of the Ethereum mainnet. Arbitrum can process transactions with higher throughput and lower fees, while maintaining full compatibility with Ethereum's smart contracts, making it an attractive choice for developers and users seeking a more scalable and cost-efficient blockchain option.

With the persistent congestion challenges on the Ethereum mainnet, Arbitrum has emerged as a viable alternative that offers a seamless transition for Ethereum-based applications. Its established track record, combined with the ability to inherit Ethereum's security through Layer 1 adjudication, establishes Arbitrum as a leading solution to unlock the full potential of Ethereum and foster the growth of the decentralized ecosystem.

What Is ARB?

The Arbitrum token (ARB) is the native token of the Arbitrum blockchain, providing several utilities and benefits to its holders. ARB holders have the opportunity to participate in the governance of the Arbitrum network, influencing its future development and demonstrating a vested interest in its success. Additionally, ARB tokens can be staked, allowing holders to earn rewards and contribute to the security of the network.

ARB is also used to pay for transaction fees on the Arbitrum network, ensuring that fees remain affordable and facilitating widespread adoption. Moreover, ARB tokens can be utilized to provide liquidity to Arbitrum-based DeFi protocols, enhancing their liquidity pools and making them more attractive to users. Lastly, ARB can be traded on cryptocurrency exchanges, enabling investors to speculate on its price and potentially earn profits.

Overall, the ARB token is a valuable asset for users of the Arbitrum blockchain, offering governance participation, staking rewards, transaction fee payment, liquidity provision, and speculative opportunities. As the popularity of Arbitrum continues to grow, the value of ARB is likely to increase, making it an appealing investment for crypto enthusiasts and investors.

ARB Tokenomics

The ARB token was introduced with a maximum supply of 10 billion tokens and an annual inflation rate of 2% thereafter. The token supply is allocated as follows: approximately 43% is reserved for the Arbitrum DAO treasury, 27% is allocated to the Offchain Labs team, 18% is designated for Offchain Labs investors, 12% is airdropped to eligible users, and 1% is allocated to active DAOs developing on Arbitrum. Both investor and team tokens are subjected to a 4-year lockup period, with a 1-year vesting cliff followed by monthly unlocks. This ensures a controlled distribution of tokens over time while providing long-term commitment from investors and the team.

ARB Statistics

History of Arbitrum

The history of Arbitrum dates back to 2018 when a team of computer scientists and entrepreneurs, including Ed Felten, Harry Kalodner, and Steven Goldfeder, established the project. Initially incubated by Offchain Labs, a blockchain research and development firm, the project gained momentum.

Ed Felten, who had previously served as Deputy CTO at the White House during the Obama administration, returned to Princeton University to continue his research and teaching. It was there that he collaborated with two of his Ph.D. students, Kalodner and Goldfeder, to lay the foundations of Offchain Labs.

In May 2021, Offchain Labs introduced the mainnet beta version of Arbitrum One for developers. This "soft launch" aimed to ensure a smooth onboarding experience for dApp clients before public users' funds were put at risk. Within a short span, over 300 decentralized applications were onboarded, solidifying Arbitrum One's position as one of the leading Ethereum Layer 2 scaling solutions and the largest optimistic Layer 2 solution by Total Value Locked (TVL).

Features of Arbitrum

Arbitrum, a platform designed to enable efficient and scalable Ethereum-compatible smart contracts, stands out from other solutions with its unique features. These distinguishing features include:

High EVM Compatibility: Arbitrum is highly compatible with the Ethereum Virtual Machine (EVM) at the bytecode level, allowing developers to use existing languages like Solidity and Vyper without the need for extensive adjustments. This compatibility streamlines the development process on Arbitrum.
Robust Developer Tooling: Arbitrum aims to minimize barriers for developers, providing comprehensive documentation and allowing them to utilize existing Ethereum tooling. Developers can leverage familiar tools without the need for specific Arbitrum plugins or compilers.
Low Fees: As a layer 2 scaling solution, Arbitrum significantly reduces transaction fees compared to Ethereum. Leveraging its efficient rollup technology, Arbitrum offers substantially lower fees while maintaining adequate incentives for validators.
Arbitrum NOVA: Arbitrum features "Arbitrum NOVA", a new chain built with AnyTrust technology to enhance scalability on the Ethereum blockchain. Arbitrum NOVA stands out from the original Arbitrum One chain, which employs Offchain Labs' Rollup technology, by further reducing fees and positioning itself as an exceptionally cost-efficient blockchain solution. It particularly supports high-throughput DApps, with a specific emphasis on gaming applications.
Well-Developed Ecosystem: Arbitrum has already established collaborations with a diverse range of Ethereum dApps and infrastructure projects. Notable partners include Uniswap, DODO, Sushi, and many others, demonstrating the platform's integration within the Ethereum ecosystem.

Arbitrum's combination of EVM compatibility, developer-friendly tooling, low fees, fair launch approach, and existing partnerships contribute to its uniqueness and potential to address Ethereum's scalability challenges effectively.

Arbitrum Token Value

As of July 9, 2023, the value of the Arbitrum token (ARB) is approximately $1.13, the value of ARB is driven by various factors. The value of ARB is influenced by the growing demand for Arbitrum as a Layer 2 scaling solution for Ethereum, offering faster transactions and lower fees. The utility of ARB, with features like governance, staking, transaction fees, liquidity provision, and speculation, enhances its value as a utility token. The overall performance of the cryptocurrency market also influences ARB's price, with bullish conditions potentially leading to price increases and bearish conditions potentially causing price decreases.

It is important to consider that ARB's value is volatile and subject to significant fluctuations over time. Consequently, risk-averse investors seeking stability may not find ARB suitable. However, for those willing to embrace some level of risk, ARB presents a potentially profitable investment opportunity.

How to Buy ARB Tokens?

CoinEx is a global cryptocurrency exchange, trusted by 5+ millions of users worldwide with 100% reserve. With its 700+ tokens supported, including ARB, users can now trade easily and seamlessly. To purchase ARB on CoinEx, follow the steps below.

To begin trading on CoinEx, you must first create an account. CoinEx allows users to deposit or swap without completing KYC, but verification offers more features.
After logging in, deposit funds into your CoinEx account using one of the supported cryptocurrencies or deposit methods supported by the exchange.
After depositing fiat or cryptocurrency, go to the ARB trading page, choose a trading pair "ARB/USDT", and specify the amount of ARB coins to purchase.
To buy ARB, choose the appropriate trading pair, specify the desired quantity of ARB coins, and trade the paired token for ARB.

With these simple and straightforward instructions, you can buy ARB cryptocurrency on CoinEx in a simple manner.

What Is Arbitrum and How to Buy ARB Coins?