Wigwam is the best Optimism blockchain crypto wallet

Optimism blockchain review

Optimism is a performant, scalable, and stable Layer 2 chain designed with the objective to create a sustainable ecosystem for Ethereum. The transactions are executed on Optimism, however, the transaction information is posted to the Ethereum mainnet where they are validated. The prime goal and purpose of this chain are to help the Ethereum network operate smoothly by taking off some of its transaction load. 

Origins and Vision

Founded by Jinglan Wang, Benjamin Jones, Karl Floersch, and Kevin Ho, Optimism made its debut in June 2019. This chain has been designed with the vision of solving one of the major weaknesses of the Ethereum blockchain, its low throughput. 

Key Milestones

1. Optimism’s journey began with the Mainnet launch in March 2021, setting the stage for innovation, which reached its peak in December with the introduction of the OP Stack. 
2. The introduction of the OP Stack offered an open and collaborative ecosystem where different projects can work together and benefit from each other. 
3. Moving forward to the year 2022, the network launched its native token- Optimism ($OP). The token was launched on May 31, 2022, and astonishingly peaked at a market cap of a whopping 420 million as of July 31, 2022 (in just two months). 
4. In the same year, the network experienced a substantial expansion of its ecosystem by successfully deploying over 6,800 contracts and welcoming a whopping 300,000 unique addresses. 
5. The year 2023 marked a new era for Optimism with the unveiling of the innovative Optimism Bedrock- the latest iteration of OP Stack, which enables the deployment of production quality Optimistic Rollup blockchains.

Since the inception of Optimism, the platform has generated $24.5 million in revenue, firmly establishing itself as a driving force in the blockchain landscape.

What Consensus Algorithm does Optimism Blockchain use?

Optimism blockchain shares the Proof of Stake (PoS) consensus algorithm with the Ethereum blockchain and since it is a layer-2 (L2) blockchain it uses the Optimistic Rollup solution to enhance scaling, leveraging the security of the ‘parent’ (Ethereum). 

This roll-up strikes a balance between scalability, security, and decentralization, offering a promising solution to Ethereum’s scaling problem while maintaining a strong connection to the mainnet for security and trust.

How it Differs from Ethereum

In this consensus method, 100s of transactions are “rolled up” into batches, which are then relayed to the Ethereum blockchain mainnet, which records the overall state of the blocks. 

These rollups are assumed to be valid, they are known as optimistic rollups. Although, a rollup’s validity can be challenged and invalidated for up to seven days. This is why the asset transfers from the Optimism chain to Ethereum via the official bridge take up to seven days.

How Optimism Technically Solved Problems with Scalability, Decentralization, Speed

Optimism uses the Optimistic Rollup Solution which addresses blockchain scalability by rolling up transactions into batches and maintains decentralization by making the data available and speeds up the process by rolling up transactions and assuming them to be valid. Although, a rollup’s validity can be challenged and invalidated for up to seven days.

Who are the Main Players in the Blockchain

In the Optimism blockchain ecosystem, key roles include:

1. Validators: Optimism relies on a sequencer (Validator in Optimism’s network), to transmit block information to Ethereum's validators, with security being provided by the Ethereum network.
2. Proposers: Proposers in the Optimism network are in charge of forming new blocks. They decide and propose the desired post-transaction state for the blockchain.
3. Verifiers: Verifiers are part of the validator/sequencer in the Optimism ecosystem. They review and validate the proposed transactions.
4. Arbiters: Arbiter's role is to make decisions when transaction disputes or conflicts occur within the network.

These key players work together to ensure the security, integrity, and efficiency of the Optimism blockchain.

DeFi Ecosystem on Optimism

DeFi on Optimism offers reduced gas fees, interoperability with Ethereum, and migration options for existing DeFi projects. It offers solutions for scalability and reducing transaction costs which were the biggest issues with Ethereum. 

Optimism’s DeFi ecosystem is quite diverse including decentralized exchanges like "Velodrome," "Uniswap V3," and "Beethoven X," lending protocols like "Aave V3," "Sonne Finance," and "Lyra," as well as derivatives exchanges such as "Aevo," "Cryplex Finance," and "Kwenta." Install the Wigwam DeFi wallet to participate in the Optimism ecosystem.

NFTs Marketplaces on Optimism 

NFT marketplaces on Optimism offer lower transaction costs and improved scalability, attracting a broader range of artists and collectors. The interoperability with Ethereum's mainnet maintains the value of NFTs, and the reduced barriers to entry and innovation potential make these marketplaces economically significant in the NFT space. 

Optimism has multiple NFT marketplaces like “anotherblock”, “Wen Moon Market”, and “Double Protocol”. These marketplaces feature a wide range of NFTs, serving as a hub for artists and collectors to mint, buy, sell, and trade NFTs. 

Tokenomics and Gas Usage on Optimism

Optimism operates as a layer-2 blockchain, where ETH serves as the default transaction token. However, within the Optimism ecosystem, the native governance token is OP, and users can opt to use either ETH or OP for transactions. Sticking with ETH for gas payments requires no action, but utilizing OP provides various advantages. 

Conclusion

Optimism is a game-changer layer-2 solution for Ethereum, where new blockchains were coming as the “Ethereum Killer”, Optimism might have just given a different route. It addressed Ethereum’s scalability issues, having the potential to reshape the Ethereum landscape and make blockchain technology more accessible and user-friendly. Optimism provides lower gas fees, interoperability with Ethereum, and migration options for existing projects.