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Coverage on L2s.
About the editor: Spencer Noon is Co-founder & General Partner at Variant Fund.
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Coverage on Aztec, Optimism, and Arbitrum.
👥 Jon Wu
📈 Aztec reaches 13k ETH deposits
Aztec Network is a privacy-first zkRollup offering cheap, private transactions on Ethereum. Aztec Connect, its VPN-like product connecting users to Ethereum services, has been in production for just over a month, and recently crossed 13k ETH and $3.2m DAI deposited.
Aztec Connect provides a low-cost, private gateway to Ethereum DeFi. Its two launch integrations - a Curve/Lido ETH-wstETH swap and an Element Dai fixed-yield vault - are evidence of that utility. Aztec's Curve and Element bridges are the 20th and 2nd largest holders of their respective assets.
Finally, the system is processing 32 rollups per day on average (each containing an average of 177 transactions), leading to an average wait time of 22 minutes for rollup settlement. Aztec Connect is performing at 5x the rollup velocity and 8.4x the transaction velocity of the pre-Connect system.
📈 Early Incentives Bring $725M+ to Optimism
Following the Optimism Collective and the OP Token House announcements, Optimism Governance went live. In the first "season," 59 projects requested tokens for growth/incentive programs, and delegates approved 41 of these proposals (season 1 review). In parallel, the partner fund directed a few token allocations. Only 10+ growth programs have gone live so far, but since the first program launched on July 13th, net +$725M has already moved to L2 Optimism from L1 Ethereum.
Many of these early growth programs incentivized liquidity. Among programs launched in July, Velodrome led with +$69M net deposits, followed by PoolTogether +$34M, Lyra +$15M, Stargate +$8M, and Rubicon +$6M. In August, Aave's growth program launched, which led to a spike of +$550M net deposits.
Optimism has also seen growth in apps and usage. In the last 30 days, Optimism averaged 146k transactions / day (+43% vs prior 90 days). App growth was led by DEXs: Velodrome +10k (+460%), Uniswap +5k (+93%), Rubicon +0.5k (+160%); and Lending/Borrowing: Tarot +0.9k (+730%), Aave +0.9k (+220%).
📈 Arbitrum TVL tracking ~$950m
Arbitrum is a leading layer 2 (L2) scaling solution. The project uses optimistic rollups (ORs) to batch transactions, allowing high throughput of up to 4.5k transactions per second (TPS). Arbitrum TVL is tracking ~$952m, second to Optimism. While down from previous highs, the L2’s TVL is up ~55% MoM. Arbitrum also announced Arbitrum Nova this week, a new chain designed for lower cost gaming and social applications; for example, Reddit is an early partner.
To date, Arbitrum has primarily been an ecosystem geared towards sophisticated DeFi applications. GMX - a decentralized perps exchange - leads in TVL on the L2, where the vast majority of the dapp’s liquidity resides. Similarly, Dopex - a leading decentralized options exchange - has most of its liquidity on Arbitrum.
Unique addresses continue to climb, with a notable uptick in late June. Arbitrum is currently tracking at ~1.1m, versus Optimism at ~1.4m and Ethereum at ~203m. Unlike Optimism - the other dominant OR - Arbitrum does not have a token.
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