Optimism, an Ethereum scaling solution, has raised $150 Million in Series B funding. It was co-led jointly by Paradigm and Andreessen Horowitz.
The blockchain startup announced in a blog post that its current value is $1.65 billion. This new round of funding will go towards the expansion of its team.
Optimism Solves Ethereum’s Scalability Problems
Ethereum is a popular platform for computing, with a lot of DeFi and NFT apps. However, the dramatic rise in developer and user demand has resulted in dramatic gas fees. Optimism uses optimistic rollups to achieve substantially lower costs, latency and far greater throughput than Ethereum Layer 1, without compromising security features of its underlying blockchain.
Jinglan Wang, CEO of Optimism, was quoted as saying:
“We made a promise to the public that we would never take profits from operating central parts of the system. So we wanted to eliminate the financial incentive to keep the system centralized.”
Chris Dixon, a general partnership at Andreessen Horowitz, confirmed the investment in Optimism and stated that scaling Ethereum was a critical near-term challenge. He also added that it would “dramatically increase the design space for Web3 apps.”
Blog post revealed that Optimism users had reportedly saved $1 million in gas during the past year. This includes thousands of code deployments and three forks going live. Optimism also reduced fees by more than 30% over the last year and is working to improve the protocol to reduce costs further.
The statement stated that Optimism will reduce fees by 30%-40% and deploy the first ever system-wide calldata compression within the next few weeks.
The startup, Optimism Bedrock, will allow for more fee reductions this summer. It theoretically allows for optimal transaction submission costs via Cannon (its next-gen fault-proof). The Ethereum Improvement Proposal (EIP-4844) aka Shard Blob Transactions will be a contribution of the team. This proposal has the potential to reduce fees up to 100x.
According to the team,
Our greatest asset is our people. The Optimism team already has a slew of talent whose huge brains can only be surpassed by their big hearts. As a team we have been growing tremendously and are extremely proud to have amassed such an amazing group of technical talent. ”
DeFi Llama’s latest stats show that Optimism holds more than $360million in total value (TVL) on its platform. These figures showed a dramatic 96.6% increase in the value of Optimism from $150 million to $295 millions in just three days in October. In January, TVL reached almost $400 million.
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