Arbitrum is a Layer 2 scaling solution for the Ethereum blockchain, designed to enhance its transaction speed and reduce costs. Arbitrum achieves this by using a technology called Optimistic Rollups, which processes transactions off the Ethereum main chain while still ensuring security by posting data back to Ethereum.

The Arbitrum coin (often referred to as ARB) is the native governance token of the Arbitrum network. It is used for voting on protocol upgrades and decisions within the ecosystem, allowing holders to participate in the decentralized governance of the platform.

Key features of Arbitrum include:

1. Faster transactions: By moving most of the computation off-chain, Arbitrum can handle more transactions per second (TPS) than Ethereum.

2. Lower fees: It significantly reduces the gas fees typically associated with Ethereum transactions.

3. Ethereum compatibility: Arbitrum is fully compatible with existing Ethereum smart contracts, making it easy for developers to migrate or build decentralized applications (dApps) on Arbitrum.

In short, the Arbitrum coin (ARB) plays a key role in the governance and functioning of the Arbitrum network, which aims to improve Ethereum's scalability and user experience.

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