Arbitrum will be the first Layer 2 network supported by the DeFi service.
Key Takeaways
Yearn.Finance has added support for Arbitrum, a Layer 2 network for Ethereum.
The addition will help Yearn.Finance scale up by reducing gas costs and transaction fees involving Ethereum-based tokens.
Other DeFi platforms are adding support for Arbitrum as well, along with other Layer 2 networks like Optimism and Polygon.
Yearn.Finance, one of the most popular DeFi platforms, has added support for the Ethereum Layer 2 network Arbitrum.
Arbitrum Will Reduce Gas FeesYearn.Finance’s decision to support Arbitrum means that users will be able to transact Ethereum-based tokens without moving those coins on Ethereum itself. The project says that Arbitrium could reduce gas costs (i.e. transaction fees) by a factor of 10.
Yearn.Finance was created to support Ethereum-based ERC-20 tokens, allowing users to deposit and earn yield rewards on those tokens. As such, the project says that the decision to support a Layer 2 network strengthens its “first true love: Ethereum.”
The project says that it chose Arbitrum specifically because it is Ethereum’s largest Layer 2 network, with over $3 billion locked. It also drew attention to the fact that major exchanges such as Binance and FTX have added support for Arbitrum.
A series of tweets published by Yearn.Finance today instructs users on how to deposit funds and earn yields via Arbitrum. It also suggests that extra features are on the way, as “more Arbitrum vaults, L2 roll-up, and sidechain vaults are planned.”
Yearn.Finance is the seventh-largest DeFi platform when measured by total valued locked. The platform currently has $2.94 billion in total value locked (TVL), according to DeFi Pulse.
DeFi Is Turning to Layer 2 NetworksOther DeFi platforms are also adding support for Arbitrum. Uniswap began adding support for the network last May, while 1inch added support for Arbitrum around September. Other projects integrated with Arbitrum can be seen on its portal page.
Arbitrum, though, is not the only second layer network available to DeFi services. Various DeFi services are supporting other popular scaling networks such as Optimism and Polygon.
Collectively, these efforts will work toward offloading traffic from Ethereum itself. Ethereum is strained by large transaction volumes, resulting in high fees and long transaction times—a problem that has helped Layer 2 scaling solutions gain prominence.
Yearn.Finance had previously added support for Fantom, a Layer 1 blockchain.
Disclosure: At the time of writing the author of this piece owned BTC, ETH, and other cryptocurrencies.
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
Earning High Yields Without the Complexity of DeFi? Welcome to Hodlnau…
One of the most popular trends in cryptocurrencies dates back to ancient times: lending money to earn interest. In the traditional banking system, people store their funds and they get…
Arbitrum Is Now Live on Ethereum Layer Two
News
Aug. 31, 2021
Arbitrum launched on Ethereum mainnet today. Arbitrum is a Layer 2 protocol that seeks to scale and lower the gas fees on Ethereum by carrying transactions off-chain. Arbitrum Launches With…
Arbitrum Launch: Layer 2 Ethereum Unpacked
Scalability has been Ethereum’s biggest challenge as its popularity rises. One of the key Layer 2 solutions hoping to solve the issue, Arbitrum, has now launched for developers. The Road…
A New Layer 2 Bridge Between Polygon and Arbitrum Is Launching
Ethereum interoperability project Wanchain will launch a cross-chain bridge between Polygon and Arbitrum. Wanchain Will Deploy an Ethereum Layer 2 Bridge Wanchain has entered a strategic partnership with Polygon to…