Arbitrum represents an innovative scaling solution for Ethereum, operating as a layer-two (L2) platform. By leveraging optimistic rollups, it aims to enhance speed, scalability, and cost-effectiveness within the Ethereum ecosystem. Capitalizing on the inherent security and compatibility of Ethereum, Arbitrum achieves higher throughput and lower fees compared to the Ethereum network. This achievement is made possible by offloading a significant portion of computation and storage to an off-chain environment.
At the core of Arbitrum lies its native token, ARB, which plays a crucial role in governance. Offchain Labs, the development team behind Arbitrum, has recently introduced a decentralized autonomous organization (DAO) structure known as the Arbitrum DAO. Through this DAO, ARB holders possess the power to vote on proposals impacting various aspects such as feature enhancements, protocol upgrades, fund allocation, and the selection of a Security Council.
