Optimism For Ethereum as Layer 2 Testnet Gets Launched: What Does It Mean?

Layer 2 scaling developers at the Plasma Group have recently announced the launch of their Optimistic Ethereum testnet, which will be deployed on projects to test much needed scaling solutions.

Essentially, Layer 2 scaling involves taking work off the root chain to process data and transactions faster. The team has built a system called OVM, a fully-featured Ethereum Virtual Machine (EVM) compliant execution environment designed for L2 systems.

The OVM was first tested on Uniswap’s Unipig L2 decentralized exchange launched as a demo in late 2019.

Synthetix The First Guinea Pig

The Optimistic Ethereum testnet will be rolled out in several phases bringing early adopters on gradually so that the team can individually support each project.

On-chain synthetic assets DeFi protocol Synthetix will be the first to trial the scaling solutions offering 200,000 SNX in rewards to their users for participating. The team added that the testnet is currently open for public use, but not yet for public contract deployment as there will be bugs that need ironing out first.

Phase A of the testing will involve airdropped tokens that will allow participants to mint and burn sUSD, the Synthetix native stablecoin, and claim staking rewards. This will be done using the Görli Ethereum testnet.

Phase B will enable deposits and include an airdrop of Layer 1 Görli SNX tokens to participants who can increase their stakes if they perform a deposit. Phase C will allow withdrawals, and participants must complete a successful withdrawal to receive their testnet rewards on the mainnet.

Optimistic Ethereum is the only generalized L2 solution for Ethereum, which means that it does not require specific functionality to be built to support existing L1 protocols.

Synthetix posted a guide for users wanting to take part in the tests, stating;

“This is a huge milestone for Synthetix, Optimistic Ethereum, and indeed the entire Ethereum space.”

Ethereum Fees Update

A week after the digital dust has settled from the Uniswap airdrop and UNI launch, gas fees have fallen back a little. From a high of almost $12 on September 17, the average transaction fee has fallen back to around $2.75, according to Bitinfocharts.

This is still way too high, though, and it is hoped that many more Layer 2 solutions will be deployed to DeFi protocols over the coming months so that they can remain on Ethereum. The ETH 2.0 scaling upgrade is still at least a year away, so efforts such as Optimistic Ethereum could become its savior until then.

Binance Futures 50 USDT FREE Voucher: Use this link to register & get 10% off fees and 50 USDT when trading 500 USDT (limited – first 200 sign-ups & exclusive to CryptoPotato).

Click here to start trading on BitMEX and receive 10% discount on fees for 6 months.