284% growth in one month! Ethereum L2 TVL is going through the roof

The Total Value Locked (TVL) of Optimism, a Tier 2 scaling solution for the Ethereum blockchain, has increased by 284% in the past month, according to data from DefiLlama. Most TVL is made up of users who lend and receive loans through Optimism Assets Tier 2 blockchains on Aave.

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Ethereum: TVL at Optimism Sees Huge Rise

In anticipation of the merge update that will transition the blockchain from a proof-of-work network to a proof-of-concept network, many investors are trading digital assets connected to the Ethereum ecosystem.

Notice

Ethereum developers will test the Merge on Thursday, August 11 on the Goerli testnet. If all goes according to plan, the mainnet merge will be approved on September 19th. Problems with the Goerli merge are likely to delay the mainnet merge.

The estimated launch date for the update is set for September 19th. This stems from a recent Ethereum developer call.

Using rollups or off-chain calculations, Optimism, an Ethereum Layer-2 blockchain, aims to expand the ecosystem and speed up transactions. Transactions are entered on Optimism – and completed on Ethereum.

ETH/USD is trading at $1,853. Source: TradingView

The project has 35 protocols, including automated market maker Velodrome, decentralized exchange Uniswap and derivatives exchange Synthetix. The current capacity of the Ethereum blockchain of 30 transactions per second is not enough to handle the huge volume of user trade orders on the exchanges (including cancellations).

However, according to some analysts, the network could scale to 100,000 transactions per second with The Merge upgrade, and Tier 2 solutions are said to improve that capability even more.

Hope blocks are created and run on layer-2. On the other hand, user transactions are bundled and transmitted to Ethereum Layer 1. On Layer-2, transactions without a mempool are immediately accepted or rejected, enabling a fast user experience. In line with TVL’s development, the project’s equivalent tokens have increased by 300% over the same period.

“God for hope 👀
From 30 million to 140 million in 5 days.”

Cheers to Hope 👀
From 30 million to 140 million in 5 days. pic.twitter.com/AQlNWvX6c9
— Maker (@MakerDAO) August 9, 2022

Goerli Testnet: Brief Report

The Ethereum network is one step closer to its biggest update yet in less than 24 hours. The second largest cryptocurrency by market cap has been preparing for years to transition from Proof of Work (PoW) to the less energy-intensive and, according to some, more decentralized Proof of Stake (PoS).

Senior Ethereum developers announced last month that the “merger” with the so-called “Ethereum 2.0” will take place on September 19. However, there is still a challenge for the developers to overcome before they can implement the update on the Ethereum mainnet.

The developers aim to roll out the update on a final testnet after completing the PoW to PoS transition on two of Ethereum’s main testnets (Ropsten and Sepolia) in June and July.

From its mid-July lows below $1,000, Ethereum is up more than 80%. ETH is currently trading in the mid 1800s.

Although this development largely coincides with a major recovery in the cryptocurrency market amid an upturn in macroeconomic sentiment. Bitcoin, for example, is up over 25% since mid-July. However, analysts point out that the anticipation of the update is a key tail driving ETH higher.

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Text credit: Newsbtc

Last updated on August 11, 2022