Arbitrum, optimism in 2024: Rising transactions, declining values—why?

Arbitrum (ARB) and Optimism (OP), two Layer-2 Ethereum solutions to scalability, have seen considerable transaction activity and fiscal performance swings this year in the ever-changing crypto industry. Although transaction activity has increased in both networks' ecosystems, their Total Value Locked (TVL) and native token values have declined.

Over the last year, Arbitrum and Optimism consumption doubled, according to IntoTheBlock. The second quarter following implementing EIP 4844 saw especially strong increase. This suggestion reduces costs and increases processing capacity by using a more efficient transaction type to increase Ethereum's capacity.

Arbitrum trades increased from 1 million to 2.6 million on June 26, a record. The number of transactions on Optimism has increased from 800,000 in April to 409,000 presently. Arbitrum has over 1.5 million transactions, exceeding Optimism despite its performance variations.

TVL, which measures the entire amount of investment in these platforms' financial systems, shows a distinct image of their financial viability. Arbitrum and Optimism witnessed TVL rise early this year, according to DeFiLlama.

In March, Arbitrum had $3.1 billion TVL and Optimism $1 billion. This is when people started using these sites and investing more. Arbitrum and Optimism's TVLs have dropped to $2.7 billion and $665 million, respectively, changing this pattern.

There are various plausible causes for the reduction in TVL and ARB/OP token values. Such influences might include investor views toward cryptocurrencies or market circumstances that affect all cryptocurrencies. These patterns may also be affected by Layer 2 network modifications.

The ARB and OP price trends might have been better. The market research shows both coins depreciating, with OP failing to break $2.2 barrier. About $1.7 is the current price. ARB has set its resistance at $1, now $0.07.

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