Cloud Hosting

Taking a significant stride toward decentralization, Arbitrum, renowned as the most substantial Ethereum layer-2 scaling solution in terms of total value locked (TVL), recently announced that they have deployed the permissionless version of their fraud proof, referred to as Bounded Liquidity Delay (BOLD), to testnet. The announcement was made on the 16th of April by Offchain Labs, developers of Arbitrum.

Ethereum layer-2 solutions have progressively risen in prominence over recent years. As of April 17, data from L2Beat revealed that these platforms maintain control over a staggering $37 billion worth of assets. Such platforms, offering inexpensive transaction options, have enjoyed substantial uptake from protocol developers and users alike. Popular alternatives like Arbitrum, Optimism, Base, etc., are amongst the favorites.

However, the prevalent popularity aside, these platforms bear considerable issues. Most critically, the development of most of their fraud proofs is still underway. This presents a contrast from common user transactions across all chains, where each transaction must undergo a thorough confirmation via a network of miners or validators a process dictated by the consensus mechanism of the transaction.

Layer-2 platforms work differently, as they reroute transactions for off-chain processing. In this scenario, it becomes theoretically impossible to determine the legitimacy of queued transactions before they are compiled and given on-chain confirmation.

Herein lies the value of the fraud proofs, the likes of those brought forth by Arbitrum and other optimistic roll-up solutions. These proofs cater to a pressing conundrum prevalent in layer-2 solutions, ensuring the validity of those transactions that are processed off-chain. Once BOLD finds integration into the Arbitrum ecosystem, it will play the role of a safety net, safeguarding the transactions integrity while simultaneously promoting efficient off-chain processing.

In line with fundamental blockchain principles, BOLD is set for decentralization. The community will handle the operation of nodes which is a deviation from the currently centralized transaction verification in Arbitrum, controlled by a sparse group of validators.

The deployment of BOLD in the testnet signifies Arbitrums intent to open its secure transaction channels to allow public participation in sustaining network security and validating Ethereum withdrawals. This pioneering step could contribute immensely to the creation of a decentralized ecosystem, while simultaneously fortifying the Arbitrum platform.

This serves as a significant milestone, making Arbitrum the first Ethereum layer-2 to launch its fraud proofs in testnet. The firms announcement has also prompted Ryan Watts of Optimism to inform the community about plans to establish a decentralized fraud-proof system for the second-most extensive layer-2 by TVL.

Despite these advancements, ARBs price is showing stability but remains under discernible pressure. The token has witnessed a 50% depreciation from its March 2024 highs at spot rates and continues to struggle against severe selling pressure. However, if buyers manage to reverse the selling trend seen on April 12 and 13, the token could potentially make a strong recovery, possibly racing towards the $1.5 mark.

See the rest here:

Arbitrum Leaps Towards Decentralization With Launch of Fraud Proofs on Testnet - West Island Blog