Arbitrum (ARB): An Analysis of Ethereum’s Layer 2 Engine

Arbitrum, introduced in September 2021, has rapidly emerged as one of Ethereum's most sought-after Layer 2 scaling solutions.

Arbitrum (ARB): An Analysis of Ethereum’s Layer 2 Engine
Photo by Nikita / Dribbble

What is Arbitrum (ARB)?

Arbitrum, introduced in September 2021, has rapidly emerged as one of Ethereum's most sought-after Layer 2 scaling solutions. With a total value locked (TVL) exceeding $1.6 billion, it stands as the second-largest Ethereum Layer 2 scaling solution, trailing only behind Optimism.

What sets Arbitrum apart is its compatibility with the Ethereum Virtual Machine (EVM), allowing developers to seamlessly deploy their existing Ethereum smart contracts on Arbitrum without necessitating any modifications. This streamlines the adoption process for developers looking to harness Arbitrum's scalability for their applications.

Additionally, Arbitrum extends its user-friendliness by supporting a wide array of Ethereum wallets and tools, simplifying the interaction with applications built on the Arbitrum network.

Benefits of Arbitrum:

  • Swift Transaction Processing: Arbitrum boasts transaction speeds up to 100 times faster than the Ethereum mainchain.
  • Economical Gas Fees: Gas fees on Arbitrum are notably lower compared to those on the Ethereum main chain.
  • Enhanced Scalability: Arbitrum can accommodate a higher throughput of transactions per second than the Ethereum mainchain.
  • Robust Security: Backed by a proficient development team, Arbitrum offers a secure solution.

Use Cases for Arbitrum:

  • Decentralized Finance (DeFi): Arbitrum is favored for DeFi applications due to its rapid transaction processing and cost-efficiency.
  • Non-Fungible Tokens (NFTs): NFT projects benefit from Arbitrum's swift transactions and reduced gas fees.
  • Gaming: Gaming applications find Arbitrum advantageous with its quick transaction processing and affordable gas fees.
  • Enterprise Applications: Enterprises leverage Arbitrum to develop and deploy blockchain-based applications tailored to their needs.‍


Arbitrum emerges as a compelling Ethereum layer-2 scaling innovation, boasting several advantages when compared to the Ethereum mainchain. These advantages encompass swifter transaction processing, reduced gas costs, enhanced scalability, and heightened security. Arbitrum proves to be a suitable option for an array of use cases, spanning DeFi, NFTs, gaming, and enterprise applications. 

At Normal Finance, we offer you peace of mind when it comes to selecting and managing your long-term cryptocurrency investments. We have developed an advanced cryptocurrency Index Fund known as the 'Normal Index Fund,' which allows you to achieve instant diversification across 40 carefully selected digital assets for the long term. Optimize your investment experience and alleviate concerns surrounding Arbitrum and other cryptocurrencies through Normal's comprehensive solution. Your financial peace of mind is our priority at Normal.