Ethereum layer-2 scaling took off in last year’s decentralized finance and crypto boom. Markets and activity have cooled a little now, but there are still some interesting DeFi protocols on L2.
According to L2beat, there is currently $4.9 billion in total value locked on layer-2. It is down from a record $7.4 billion TVL in early April, however, the figure is rising again. In this article, you will discover the latest dApps of Arbitrum and Optimism.
DeFi Protocols on Arbitrum and Optimism
The top two layer-2 scaling protocols are Arbitrum and Optimism with a 76% market share between them. Both use optimistic rollups to scale layer-1 Ethereum. The technology works by ‘assuming’ a transaction is valid and allowing a challenging period. Furthermore, this makes transactions faster and much cheaper than Ethereum.
On July 30, industry researcher ‘@TheDeFISaint’ took a brief look at some of the more popular protocols on these networks.
My research on Arbitrum & Optimism Ecosystem led me exploring more on protocols under the Ecosystem.
Below are some interesting DeFI protocols worth to check out on these L2s
A Thread 🧵
— Permissionlessness.ETH (@TheDeFISaint) July 30, 2022
Moreover, the researcher mentioned eight different DeFi protocols running on Arbitrum or Optimism.
1) Arbi Project: This portal is an Arbitrum explorer covering 197 projects running on the ecosystem. It currently reports an Arbitrum TVL of $2.5 billion.
2)Cap.Finance: This DeFi platform is a decentralized perpetual exchange offering leveraged trading. There are zero fees and up to 50x leverage on some assets.
3) Bundlr Network: This Web3 protocol has been built on Arweave. It allows users to store data permanently on the blockchain. However, the project is still in the testing phases. Also, Bundlr uses nodes called bundlers which batch multiple transactions on L2, and bundle them when moving to L1.
More About DeFi Protocols on Arbitrum and Optimism
4) Lighthouse: Similar to Bundlr, it is a Web3 permanent decentralized file storage protocol. Lighthouse is working on IPFS, Filecoin, and Polygon networks.
5) Charmverse: This is a Web3 workspace and operation platform with features including tasks, bounties, and votes.
6) Kromatika: A Uniswap alternative trading and decentralized exchange aggregator. Additionally, it offers yield farming, swaps, limit orders, and very little price slippage.
7) Meson: This cross-chain stablecoin bridge offers zero fee bridging over different networks such as Aurora and layer-2s.
8) LayerSwap: This is a platform and gateway for moving tokens from directly centralized exchanges to L2s.
As you can see, Arbitrum and Optimism are z-rollups that are having more and more development and adoption, which generates that their ecosystems are getting bigger and bigger. Can they continue to grow in the future?
DeFi TVL Outlook
Finally, the total value locked in DeFi is currently $89.7 billion, according to DeFiLlama. Furthermore, it has increased 23.5% over the past month suggesting a DeFi recovery. However, TVL is down around 64% since its December all-time high of $252 billion.
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