Arbitrum One Becomes the First Ethereum Layer 2 Network to Surpass $10 Billion TVL

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Arbitrum One Becomes the First Ethereum Layer 2 Network to Surpass $10 Billion TVL
Ledger



Arbitrum One’s Total Value Locked (TVL) witnessed a remarkable increase of 15.9%, reaching a milestone of $10.22 billion in the past seven days, making it the first Layer 2 (L2) network to surpass the $10 billion TVL mark.

The achievement follows an incident on December 15, where Arbitrum One faced a two-hour partial outage due to a surge of Bitcoin Ordinals-inspired inscriptions that led to the triggering of a sequencer stop.

Arbitrum One Dominates Ethereum Layer 2 TVL

According to data by L2Beat, the total TVL for Ethereum Layer 2 networks has reached $20.82 billion, with Arbitrum One contributing significantly by accounting for 48.03% of the total.

Arbitrum currently holds a diversified asset portfolio with 30.9% in Ethereum (ETH), 23.68% in its native governance token ARB, 29.66% allocated to stablecoins, and the remaining 15.76% spread across various other assets. Notably, the ARB token has registered a 14.3% increase in value over the past 24 hours, according to Coingecko data.

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The success of Arbitrum One can be attributed to its ability to replicate the Ethereum experience while offering substantially lower transaction costs. This cost-effectiveness has attracted a considerable number of decentralized applications (dApps), with approximately 470 currently deployed on the network.

The implementation of the ARB token, serving as a governance token, has significantly contributed to the platform’s growth. Governance tokens empower holders to actively participate in decision-making processes concerning the platform’s development and policies, thereby incentivizing greater user engagement within the ecosystem.

Furthermore, the Arbitrum One network boasts a well-established Security Council, a deployed and operational proof system, and accepts fraud proofs from a minimum of five external actors. Moreover, the platform offers a 7-day exit window without relying on a permissioned operator in the event of an unpopular upgrade by actors with more centralization than a security council.

Arbitrum One on Upward Trajectory After Outage

Arbitrum One faced downtime on December 15, which was categorized as a “major outage” on the dashboard. An investigation was initiated to identify the root cause and implement a fix.

Before the interruption, Arbitrum’s layer-2 network had processed over 22.29 million transactions, as reported by l2beat, and boasted a total value locked of $2.3 billion, according to DefiLlama data.

The incident on December 15 was not the first time Arbitrum faced disruptions. In June 2023, the DeFi Layer 2 network experienced a standstill for over an hour due to a bug in its sequencer. The bug caused the sequencer to revert batches on-chain, leading to the depletion of Ether (ETH) from the sequencer. Developers intervened by manually replenishing the sequencer, addressing the bug, and restoring normalcy to the Layer 2 network.

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