Optimism is one of Ethereum’s largest scaling solutions, using unique “Optimistic Rollups” technology to bundle transactions and reduce fees on the Ethereum network. OP coin is Optimism’s native governance token and the first rollup token. Currently, OP ranks among the top fifty cryptocurrencies, and users can obtain OP tokens through exchanges, trading platforms, airdrops or participating in the Optimism ecosystem.
What is Optimism?
Optimism (OP) is Ethereum’s layer 2 scaling solution, first proposed in 2019 by founders Jinglan Wang, Ben Jones, Karl Florsch, and Kevin Ho, with the mainnet opening in 2021. It is designed to reduce the load on the Ethereum network, allowing users and developers to benefit from Ethereum's strong security guarantees while being cheaper and faster.
Layer-2 scaling solutions
Before diving into OP tokens, it’s important to understand the concept of Layer-2 scaling and how Optimism fits into the Ethereum ecosystem. Layer-2 scaling solutions are designed to alleviate congestion on the Ethereum network by processing off-chain transactions and publishing them regularly to the main Ethereum blockchain (Layer-1). Optimism utilizes a specific type of layer 2 solution called “Optimistic Rollups” to bundle multiple transactions into a batch, thereby reducing the number of transactions to be processed on the Ethereum network.
Optimistic Rollups
Additionally, "Optimistic Rollups" assume that transactions are valid (and therefore "optimistic"), which speeds up processing by omitting unnecessary work (although users can challenge the validity of a transaction batch by submitting a fraud proof) . By compressing transaction data and regularly submitting it to the Ethereum mainnet, Optimism significantly reduces transaction fees and increases transaction throughput.
In addition to increasing transaction speeds and reducing fees, Optimism also provides Ethereum developers with the opportunity to use all the tools available on Ethereum without making changes. Optimism's Ethereum Virtual Machine (EVM) equivalent architecture allows you to scale your Ethereum applications without incident.
Currently, Optimism is committed to building a sustainable ecosystem through traceable public goods funding and is expanding Ethereum’s current scale to fund its future.
Optimism Development Team and Financing
To achieve the above goals, the initiative established the Optimism Foundation to act as stewards of the Optimism Collective, conduct experiments, stimulate the ecosystem, and then eventually disband and give the Optimism community full control. The Optimism Foundation will be led by Optimism co-founders Jinglan Wang and Ben Jones, along with Eva Beylin (Graph Foundation Director), Abbey Titcomb (Radicle Community Lead) and Brian Avello from the Maker Foundation.
In addition, Optimism PBC has also been renamed OP Labs PBC, and Liam Horne, the former head of engineering at Optimism PBC, will take over as the new CEO of OP Labs PBC. To date, the project has raised over $150 million in funding, with previous funding rounds including:
January 15, 2020, Seed round ($3.5 million): Paradigm, IDEO Colab Ventures.
February 24, 2021, Series A ($25 million): Andreessen Horowitz, Paradigm, IDEO Colab Ventures.
March 17, 2022, Series B ($150 million): Paradigm, Andreessen Horowitz. The current valuation is US$1.65 billion.
How the Optimism (OP) coin works - Rollup
Optimism uses optimistic rollup, which we briefly introduced above. Next, we will explain in detail how the rollup technology works.
Rollup technology
Rollup is a layer 2 scaling technology that stores the hash of the contract state along with the transaction call and parameters on-chain and records it as call data, with the actual transaction calculation happening off-chain. Rollups perform transaction operations on the Ethereum blockchain but still publish transaction data on Layer 1. Because transaction information is recorded on the Ethereum blockchain, Rollup benefits from the same security measures available at Layer 1, achieving high performance by grouping off-chain transactions into on-chain state transitions. The security of Rollup is guaranteed by the ability of on-chain contracts to verify the accuracy of state transitions.
Optimistic Rollup
Optimistic Rollup is the most popular rollup method and ZK-Rollup is another popular solution. To ensure deterministic smart contract execution between L1 and L2, Optimism resolves any differences using the OVM (Optimistic Virtual Machine), an EVM-compatible execution environment that can be used at Layer 2. This creates a smart contract called the Execution Manager, which acts as a virtual container for the OVM contract, providing functionality to keep functionality consistent between L1 and L2.
When you submit a transaction, the transaction data is written to the Ethereum mainnet, but the transaction itself is executed by one computer, the sequencer (rather than thousands of computers like Ethereum). This significantly reduces transaction costs, and the challenge mechanism ensures that the orderer is honest.
What is OP Coin?
Officially launched on May 31, 2022, $OP is the native governance token of the Optimism platform and is mainly used for governance protocols. OP tokens play a vital role in the direction and functioning of the Optimism ecosystem, as OP token holders can participate in key decision-making processes and help shape the future of Optimism.
Purpose of OP Tokens
The primary purpose of OP tokens is to enable token holders to vote on proposals and changes to the Optimism Network. This ensures that the community has a say in the development and governance of the platform. OP token holders contribute to important decisions related to software upgrades, funding of public goods, and other aspects of the Optimism ecosystem.
OP token airdrop
At the same time as the launch of OP coins, Optimism released OP airdrops and successively sent free tokens (accounting for 5% of the total initial token supply) to 249,000 eligible addresses to reward early users of the project and other Ethereum Square users, such as DAO voters, multi-signers and Ethereum cross-chain bridge users.
Optimism Early Users: Those who used Optimism before June 23, 2021 will receive 727.36 OP per wallet
Repeat Optimism users: Interact with Optimism for 4 weeks and earn 1,584.42 OP per wallet.
DAO Voters: Regularly participate in Ethereum DAO voting (Governor Alpha and other DAOs).
Conclusion: As one of the largest expansion solutions for Ethereum, Optimism’s unique “Optimistic Rollups” technology not only reduces transaction fees, but also increases transaction speed. OP Coin, as its native governance token, plays a vital role in the ecosystem. As Optimism continues to develop and expand, its future prospects are promising and worthy of investors' attention.