Optimism (OP) review: What it is and how it works

Optimism (OP) is a scaling solution for the Ethereum blockchain, helping to reduce transaction fees and increase processing speed. Built on rollup technology, Optimism aggregates many small transactions into a single large transaction, reducing the load on the main network.

To better understand how Optimism works and the benefits it offers, let’s dive into the details with AZCoin in the following section.

What is Optimism (OP)?

Optimism (OP) is a Layer 2 scaling solution for Ethereum, aiming to enhance performance and reduce transaction fees on the Ethereum network. Optimism utilizes a technology called “Optimistic Rollup,” which allows transactions to be conducted off-chain and only records the aggregated results of these transactions on the main chain, helping to reduce load and increase transaction speed.

Development team, investors, partners

Development team

The Optimism organization has been established with the mission to conduct trials, manage the Optimism Collective, and foster the development of the ecosystem. Simultaneously, this team plans to eventually step back entirely in the future to empower community governance entirely.

Key members of the development team at Optimism organization include:

• Jinglan Wang: Co-founder and CEO of Optimism.
• Benjamin Jones: Co-founder of Optimism.
• Eva Beylin: Board member of Optimism.

Investors

Optimism has raised $178.5 million through three funding rounds, including the Seed round ($3.5 million), Series A ($25 million), and Series B ($150 million). Participating investors in these rounds include Andreessen Horowitz (a16z), Paradigm, and IDEO CoLab Ventures.

Partner

Optimism has collaborated with various DeFi projects such as Uniswap, Velodrome, and 1inch to develop the ecosystem. They have also partnered with Worldcoin to launch World ID and World App on their Layer 2 mainnet.

Furthermore, other projects like Base, opBNB, Zora, Celo, and DeBank have utilized the OP Stack SDK toolkit to build their own Layer 2 solutions.

Highlights of the Optimism project

Similar to Bittensor, Optimism has garnered significant attention from the blockchain community due to the following key highlights:

• Transaction experience: Fast processing speed, with gas fees reduced by 88 times compared to current Ethereum fees.
• Convenience for Dapp scaling and deployment: Fully supports EVM, allowing Dapps from Ethereum or other EVM-compatible ecosystems to run on Layer 2 with just a few lines of code.
• Security: Layer 2 still inherits the strict security level of Layer 1 Ethereum.

How does Optimism work?

As mentioned above, Optimism utilizes rollup technology to conduct off-chain transactions and then aggregates them into a single transaction for confirmation on-chain. This reduces the burden on the Ethereum network and makes transaction processing faster and more cost-effective.

Specifically, the operation process of Optimism unfolds as follows:

• Users perform off-chain transactions through a cryptocurrency wallet or a DeFi application integrated with Optimism.
• These transactions are sent to Optimism for confirmation and consolidation into a single transaction.
• The consolidated transaction is then sent to the Ethereum chain for confirmation.
• Once confirmed, the transaction result is sent back to the user through the cryptocurrency wallet or DeFi application.

In this way, users experience transactions similar to directly transacting on the Ethereum chain without the need to wait for long periods or incur high fees.

Basic information about OP token

Technical specifications of OP token

The OP token is the official token of the Optimism platform, issued based on the ERC-20 standard on the Ethereum network. The technical specifications of this token are as follows:

• Token Name: Optimism (OP) Token
• Ticker: OP
• Blockchain: Optimism
• Token Standard: ERC-20
• Contract: 0x4200000000000000000000000000000000000042
• Token Type: Governance
• Total Supply: Updating…
• Initial Supply: 4,294,967,296 OP

OP token allocation

The total number of OP tokens allocated is as follows:

– Ecosystem Fund: 25%

– Retroactive Public Goods Funding (RetroPGF): 20%

– User Airdrops: 19%

– Core Contributors: 19%

– Sugar Xaddies: 17%

What is OP token used for?

The OP token can be used for the following purposes:

• Payment for farming and liquidity mining activities.
• Used to pay fees when utilizing the features of the Optimism platform.
• Can be used for voting and influencing decisions regarding improvements and developments within the ecosystem.
• Stored and traded on cryptocurrency exchanges.

Where to trade OP tokens?

Investors can trade OP tokens on the best crypto exchanges in the market, such as Binance, Coinbase Pro, Huobi Global, Uniswap, and other DeFi exchanges.

Choosing a suitable and reliable exchange is crucial to ensure the safety and efficiency of the trading process for investors.

In which wallet to store OP tokens?

To store OP tokens securely and conveniently, investors can use popular and reliable cryptocurrency wallets available in the market. Here are some types of wallets that investors can use to store OP tokens:

• Hardware wallet: Hardware wallets such as Ledger Nano S, Ledger Nano X, Trezor, etc.
• Software wallet: Software wallets such as Trust Wallet, MetaMask, MyEtherWallet, etc.
• Directly stored in the wallet of a listed exchange.

Choosing the appropriate wallet is crucial to ensure the safety and convenience of storing and trading OP tokens for investors.

Assessing the future of Optimism (OP)

The future of Optimism is very promising as the project has garnered significant attention and support from the user community and investors. With advanced rollup technology, Optimism aims to solve congestion and transaction cost issues on the Ethereum network, opening up opportunities for the development of DeFi and blockchain platforms.

Additionally, integration with major projects such as Uniswap, Aave, Chainlink and Synthetix enhances the feasibility and effectiveness of Optimism in providing diverse and useful DeFi services and products to users.

In summary, with its advantages and potential, Optimism (OP) promises to be one of the pioneering and successful projects in the DeFi and blockchain space in the future.

The end

We hope that the above information will help you gain a better understanding of Optimism and make effective and sustainable investment decisions. If you have any questions, please contact AZcoin for quick answers. Good luck!