Optimism has launched its solution to Ethereum’s transaction problem, the Optimistic Virtual Machine (OVM).
The startup announced on Friday that OVM is now live, at a time when gas fees for DeFi (decentralized finance) traders have hit near all-time highs. In fact, the cost of sending a single Ethereum transaction has been in the low single digits over the past month – a bit high for the Internet of Money.
First up is DeFi Exchange Synthetix, which has been working on an integration for several weeks. The platform enables traders to exchange Ethereum-based synthetic contracts of real assets including oil futures.
The transition will be carried out in four phases to limit the risk to the platform, Synthetix co-founder Kain Warwick wrote in a blog post on Jan. 14. Staking out the platform’s native token, SNX, is now possible on OVM, the team said.
“We decided to initiate the transition with the absolute minimum risk [layer one]and then add features over the next few months as we build trust [Optimistic Ethereum]Warwick wrote.
Optimism, formerly known as Plasma Group, has launched an implementation of so-called Optimistic Rollups (ORs). OPs – or other roll-up variants such as ZK rollups – are layer 2 solutions that serve as throughput boosters for blockchains. (These are generally no different from Bitcoin’s Lightning Network.)
A rollup allows a blockchain to handle more transactions across the network by sending out-of-chain transactions, validating them, and then setting the blanket value for the main Ethereum blockchain. Most dapps have a roll-up solution on the agenda.
In conjunction with other technical solutions, Ethereum is expected to be able to execute and settle around 100,000 transactions per second (TPS) with rollups.