Ethereum Layer 2 Network Optimism Is Dropping a Token

Key Takeaways

  • The Ethereum Layer 2 community Optimism is launching a token and new governance mannequin.
  • The Optimism group has introduced that the token shall be distributed through a sequence of airdrops, and that new customers can nonetheless become involved.
  • Optimism is considered one of a number of Layer 2 options hoping to assist Ethereum obtain scalability.

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Optimism’s new OP token shall be distributed to Optimism customers throughout “a whole season of airdrops.” The group revealed its token as half of a bigger transfer towards a decentralized governance construction referred to as the Optimism Collective.

Optimism Launches Token 

Ethereum energy customers are getting one other airdrop—a sequence of them, in actual fact.

Optimism, considered one of Ethereum’s high Layer 2 scaling initiatives, has introduced that will probably be issuing a governance token beneath the ticker OP. The Optimism group revealed the information in a weblog publish Tuesday. The group additionally shared a listing of standards for airdrop eligibility, which incorporates gadgets so simple as being an Optimism person to extra superior standards equivalent to being a DAO voter or multisig signer. 

The token airdrop would be the first in a sequence of airdrops to be launched within the coming months. Whereas the group didn’t present an actual date for the primary airdrop, it took care to warn customers that it’s not dwell but, and any try to persuade customers in any other case is a rip-off.

The token drop is a component of a bigger transfer to a extra decentralized governance construction. The Optimism Collective, as will probably be referred to as of at present’s announcement, will function a bicameral “home” system that divides governance roles amongst a Token Home and a Residents’ Home. The Token Home shall be comprised of recipients of OP through the first airdrop; Optimism will add customers to the Residents’ Home later by the use of issuing “soulbound” NFTs that can not be purchased or bought. Collectively, the bicameral system in supposed to mitigate the potential plutocratic tendencies of purely token-based governance.

Optimism leverages a type of cryptographic know-how known as Optimistic Rollups to assist Ethereum scale. By working its personal community on high of the bottom chain, it might probably course of transactions at a better pace and decrease price than Ethereum mainnet whereas leveraging the safety of the community. Optimism has a bridge that connects Ethereum mainnet to its Layer 2 community. Since launching in 2021, the community has welcomed key DeFi initiatives like Synthetix and Uniswap. In launching a token, Optimism shall be adopting a decentralized governance mannequin akin to many different related DeFi initiatives on Ethereum. 

The token announcement had been anticipated for a number of days, thanks primarily to an Apr. 19 Mirror publish wherein Optimism detailed a plan to begin a brand new chapter “pushed by group possession and governance.” A leaked Coinbase web page additionally appeared to record an Optimism token final week.  

Layer 2 Race Intensifies

The challenge has seen important development over the previous few months amid elevated concentrate on Ethereum’s Layer 2 scaling options. Based on L2Beat information, the community holds about $662 million in whole worth locked, a sum that’s jumped 15% during the last week because the token rumors began to floor. Notably, though Optimism is presently benefiting from a wave of hype, it’s nonetheless lagging behind its greatest competitor, Arbitrum, one other Layer 2 resolution of the Optimistic Rollup selection holding $3.57 billion in whole worth locked—greater than half the Ethereum Layer 2 market. 

Whereas Optimism and Arbitrum are presently two of Ethereum’s greatest scaling weapons, that’s anticipated to alter as soon as ZK-Rollups like StarkWare’s StarkNet achieve important traction. Final week, the early Ethereum DeFi challenge MakerDAO outlined plans to launch on StarkNet commencing with a bridge launch this Thursday as a part of its dedication to serving to the Ethereum ecosystem scale (2022 can also be an enormous yr for the Ethereum protocol and its scaling roadmap, because it’s because of launch its extremely anticipated “Merge” to Proof-of-Stake). 

With Optimism now dropping a token, different related Layer 2 protocols face a call of whether or not to comply with swimsuit. On the earth of DeFi, it’s not unusual for initiatives to launch a token as soon as a competitor does to incentivize utilization and assist bootstrap development. Both manner, alongside the Merge, the race to construct out Layer 2 is more likely to develop into a key narrative in Ethereumland over the subsequent few months. 

Disclosure: On the time of writing, the creator of this piece was eligible for Optimism’s token airdrop. Additionally they owned ETH, SNX, and had publicity to MKR and UNI in a cryptocurrency index. 

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