Layer 2 Network Arbitrum Surpasses Ethereum in Daily Transactions

Arbitrum’s dominance continues to grow in the first quarter of 2023 as the number of unique addresses on Arbitrum reaches an all-time high.

AccessTimeIconFeb 22, 2023 at 6:00 a.m. UTC
Updated Feb 22, 2023 at 3:34 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

On Tuesday, Feb. 21, layer 2 scaling system Arbitrum surpassed Ethereum in daily transactions, increasing Arbitrum’s dominance as the leading layer 2 rollup.

The number of daily transactions on the Arbitrum, the fourth-largest blockchain overall in terms of total value locked (TVL), jumped from 159,919 in daily transactions on Jan. 1 to over 1,103,398 at the time of press, representing a roughly 590% increase in less than two months, according to block explorer Arbiscan.

Arbitrum transactions have surpassed those of Ethereum on Tuesday. (Etherscan, Arbiscan)
Arbitrum transactions have surpassed those of Ethereum on Tuesday. (Etherscan, Arbiscan)

In comparison, the number of daily transactions on Ethereum increased a meager 46% in the same period to 1,084,290, per Etherscan.

Moreover, the number of unique addresses on Arbitrum’s network has reached an all-time high of about 2.95 million addresses, and data from TVL aggregator DeFiLlama shows that Arbitrum’s total value locked jumped 81% since Jan. 1 to roughly $1.85 billion.

Arbitrum’s move ahead of Ethereum follows GMX, a decentralized perpetual exchange native to Arbitrum, overtaking Ethereum in daily fees last week. The growing layer 2 ecosystem has also seen many financial applications emerge like Camelot, Vela Exchange and Radiant Capital, which have all seen their users and transactions increase by over 100% in the past 24 hours, per Nansen data.

Despite Arbitrum’s boost in transactions and addresses, Arbitrum is still lagging behind Ethereum in terms of network fees.

At press time, Ethereum’s one-day fees stand at $6.7 million, while Arbitrum’s one-day fees sit at roughly $154,000, which is less than 2.3% of Ethereum’s network fees for the day, according to cryptofees.info.

The increased activity on Arbitrum may stem from users hoping and speculating about a potential Arbitrum airdrop, despite the lack of plans and announcements from Arbitrum developers about a potential token drop, according to Walter Teng, vice president of digital asset strategy at Fundstrat Global Advisors.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.

Sage D. Young

Sage D. Young was a tech protocol reporter at CoinDesk. He owns a few NFTs, gold and silver, as well as BTC, ETH, LINK, AAVE, ARB, PEOPLE, DOGE, OS, and HTR.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.