Ethereum Layer 2 Optimism Raises $150 Million in Series B Funding

Ethereum scaling solution, Optimism has raised $150 million in Series B funding, co-led by Andreessen Horowitz and Paradigm.

In the latest blog post, the blockchain startup revealed that it is currently valued at $1.65 billion. The fresh round of funding will be directed towards expanding its team.

Optimism’s Solving Ethereum’s Scalability Woes

Ethereum has established itself as an extremely popular computing platform rich with DeFi and NFT applications. The dramatic increase in developer and user demand, though, resulted in equally dramatic gas fees. Optimism, on the other hand, uses optimistic rollups to achieve significantly lower costs, latency, and far greater throughput versus Ethereum Layer 1 alone, without compromising the security features of the underlying blockchain.

After the recent fundraise, Optimism CEO Jinglan Wang was quoted saying,

“We made a commitment to the public that we would not take profit from operating centralized parts of the system, so we wanted to remove the financial incentive for ourselves to remain centralized.”

While confirming the investment in Optimism, Chris Dixon, a general partner at Andreessen Horowitz, stated that scaling Ethereum is a crucial near-term challenge and added that it will “dramatically expand the design space for Web3 applications.”

Milestones

The blog post revealed that Optimism users have reportedly saved $1 billion in gas over the last year on mainnet, during which thousands of codes were deployed, and three forks went live. Optimism has also slashed fees by over 30% in the past year, and plans on working towards enhancing the protocol to cut costs even further.

Optimism is all set to decrease fees by 30-40% by deploying the first-ever system-wide calldata compression in the next few weeks, the statement said.

As part of Optimism: Bedrock, the startup will enable more fee reduction this summer by theoretically allowing for optimal transaction submission costs via Cannon, its next-gen fault-proof. The team will also be contributing to the Ethereum Improvement Proposal (EIP-4844), aka Shard Blob Transactions, which boasts the potential to slash fees by up to 100x.

The team stated,

“Our people are our greatest asset. The Optimism team is already filled to the brim with talent whose big brains are eclipsed only by their even bigger hearts. We’ve been growing immensely as a team, and are incredibly proud to have amassed such an incredible group of industry-leading technical talent. “

According to the latest stats by DeFi Llama, Optimism has more than $360 million in total value locked (TVL) on the platform. The figures noted a steep 96.6% rise in the last week of October from just $150 million to $295 million in three days. The TVL hit almost $400 million in TVL in January this year.