- Arbitrum has reached a new high in terms of transaction volume.
- Low growth activity and the use of stablecoins have raised concerns.
According to a tweet from Wu Blockchain on February 20, MediationTransaction volume hit new highs as Scalping Solutions transaction volume reached $2.62 billion and increased 34%. If the trend continues, Arbitrum could go to the toe Ethereum (ETH) Fast.
According to DeFiLlama, last week, DEX transaction volume on Arbitrum reached $2.62 billion, up 34% year-on-year, setting a new weekly high, second only to Ethereum. Most of the Arbitrum native app token has earned in the last 7 days…
– Wu Blockchain (@WuBlockchain) February 20, 2023
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As can be seen from the data from Dune Analytics, the number of transactions on Arbitrum was on track to match the transaction frequency on Ethereum.
One of the reasons for the increasing number of transactions will be the decrease in transaction fees on the protocol. As Arbitrum transaction fees continue to decline, it will become easier for users to transact on the protocol.
The high volume of transactions also affected the overall TVL collected by Arbitrum, which has increased considerably in recent weeks. In terms of TVL, Arbitrum outperforms other L2 solutions, such as Polygon (MATIC) AND Optimism (OP) Also.
Source: L2beat
This increase in TVL also affected the total revenue generated by Arbitrum. According to data from Token Terminal, the total revenue generated by Arbitrum has increased by 80% in the last 30 days. These revenues can be used to improve the network and bring new capabilities.
Some areas of concern for Arbitrum
However, despite the increase in income, the income was not being used to improve the protocol. This was indicated by the decrease in the number of active developers on the network. Over the past week, the number of active developers has decreased by 4.1%. This suggested that the frequency with which contributions to Arbitrum’s GitHub were made decreased.
Source: Token Terminal
Another alarming indicator was the decline in the use of stablecoins on the network. According to data from Sentiment, the development of the stablecoin network such as MakerDAO (DAI), USD Currency (USDC)AND tether (USDT) There has been a material decline in the last month. This implies that the new addresses were not using stablecoins on the Arbitrum network.
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Source: Feeling
Regardless of the total volume of transactions Mediation was high, a decline in stablecoin growth could cause problems for the network in the future.
Whether Arbitrum will be able to overcome these challenges in the future and maintain its position in the L2 space remains to be seen.
