Binance Integrates Support for Layer 2 Arbitrum One ETH Deposits

Key highlights:

  • Binance now supports ETH deposits from Arbitrum One
  • Arbitrum One is a layer 2 scalability solution for Ethereum that leverages optimistic rollups
  • Currently, Binance doesn’t support ETH withdrawals to Arbitrum One

Binance now supports ETH deposits from Arbitrum One

The Binance cryptocurrency exchange has announced that it has integrated support for ETH deposits from Arbitrum One, a layer 2 scalability solution built on top of Ethereum. 

According to Binance, the integration currently only supports ETH deposits from Arbitrum One to the exchange, but ETH withdrawals back to Arbitrum One aren’t supported yet. Binance says that it will support withdrawals to Arbitrum One “on a later date”, but didn’t provide more specific information.

 

Deposits from Arbitrum One are now enabled on Binance.

Exchanges directly supporting layer 2 solutions can help users save money, as getting funds from Ethereum to a layer 2 like Arbitrum One can be expensive due to high transaction fees. However, support for withdrawals to Arbitrum One would also have to be enabled for the integration to deliver the best benefits to users. Traders who are priced out of transacting on Ethereum could simply buy ETH on an exchange like Binance and withdraw it to Arbitrum with reasonable transaction fees. 

The Arbitrum One scalability solution supports arbitrary EVM smart contracts and is compatible with all the tools used by Ethereum developers. This is possible thanks to the optimistic rollup technique, where information about transactions is provided to the main Ethereum blockchain, while the execution of transactions is performed off-chain. Scaling solutions based on optimistic rollups are flexible and provide a significant scalability boost compared to the main Ethereum blockchain. The main downside of optimistic rollups is that it takes a long time to withdraw assets back to the Ethereum network (7 days in the case of Arbitrum and Optimistic Ethereum).  

Arbitrum One’s mainnet was launched at the beginning of September, and many important Ethereum-based projects have deployed their apps on Arbitrum One to give users access to a more efficient alternative to the Ethereum mainnet. This includes top DeFi projects like Uniswap, Aave, 1INCH, Curve and others.

Users currently aren’t benefiting from the full scalability improvements that Arbitrum One can offer, as the plaform’s developers Offchain Labs are only gradually bumping up the platform’s speed to ensure stability.

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