• A not for profit Plasma group transitions into a profit-making platform aiming to increased Ethereum transactions throughput.
  • Optimism aims at making smart contracts execute on a second layer above the base layer thereby increasing the transactions per second.

Ethereum developers realized that mainstream adoption would remain to be a pipe dream especially with the network's throughput limited around 15 transactions per second (TPS). Therefore, it was going to be an uphill task using Ether in automated functions, for instance, supply chain management as well as loans. For this reason, scaling was the only way to achieve the network’s mission.

Optimism intends to utilize a layered methodology, resembling that of Bitcoin’s Lightning Network to raise the capacity of people who can tap into the network using smart contracts. Before 2020, Optimism was a research-oriented not for profit Plasm Group. Its main purpose was to develop and a second layer for Ethereum network. The group has recently restructured into a profit-making platform called Optimism. It is already backed by a $3.5 million fund from Paradigm and IDEO CoLab Ventures.

While the group sees the shift to a profit-making platform revolutionary, some critics like Dragonfly Capital partner Ashwin Ramachandran think its “the death of Plasma.” Ramachandran told CoinDesk via a phone interview:

It’s like this alien that morphed many times in many different forms and eventually died … at least in the form in which it initially launched.

Optimism has already hit the ground rolling and is expected to launch the Optimistic Virtual Machine (OVM) on Tuesday. The OVM is based on Ethereum Virtual Machine (EVM) and will be used to accord the second layer similar smart contract functionality of the blockchain underlying it. In a statement, the firm said:

The OVM enables support for all existing Ethereum developer tooling including Solidity and Vyper, testing frameworks like Truffle, wallets like Metamask, and libraries like Web3.js. We designed the OVM to be used as drop-in replacement for the EVM inside of Optimistic Rollup.

With smart contracts working above the base layer, Optimism developers hope to achieve utmost scalability for Ethereum. The second layer will in future contain optimistic rollups that will see more transactions processed faster.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Cryptos feed

Latest Crypto News & Analysis

Editors’ Picks

BTC/USD trapped under short-term trendline

Bitcoin (BTC) is changing hands at $9,750, mostly unchanged both on a day-to-day basis and since the beginning of the day. The first digital asset recovered from Monday's low of $9,469, however, an upside momentum faded away on approach to $9,800. 

More Bitcoin News

NEO/USD bullish following Binance Futures support

NEO is in the green on Monday during the European trading session. The bullish momentum is taking action after a couple of days of the bulls enduring battering from the bears.

More NEO News

ETH/USD tug of war at $270 intensifies as $280 beckons

Ethereum managed to stay above the support at $240 during the bearish Monday. Also contributing to the support was the long term ascending trendline. The recovery from the support has been steady enough to hit levels slightly above $270. 

More Ethereum News

Ripple Price Analysis: XRP/USD is bearish as long as it stays below $0.30

XRP/USD recovered to $0.2950 during early Asian hours only to retreat to $0.2850 by the time of writing. Despite the sell-off, the third-largest digital asset is still nearly 2% higher from this time on Monday and mostly unchanged since the beginning of the day. 

More Ripple News


Bitcoin Weekly Forecast: BTC bulls brace for jump to $11,000

Bitcoin (BTC) has been growing for three weeks in a row. The first cryptocurrency hit $10,504 on Thursday - the highest level of 2020.

Read the weekly forecast