⛓️ STATE OF THE CHAINS ⛓️
Layer 2 wars is heating up
@optimismFND delivers insane technical progress
Modularity, Bedrock, OP Stack, Superchains and Decentralization
A megathread on the state of Optimism, my top 5 protocols (and my top unlaunched protocols alpha)
🧵👇
Layer 2 wars is heating up
@optimismFND delivers insane technical progress
Modularity, Bedrock, OP Stack, Superchains and Decentralization
A megathread on the state of Optimism, my top 5 protocols (and my top unlaunched protocols alpha)
🧵👇
1/35
In this thread I'll go through
1️⃣ What is Optimism
2️⃣ Optimism in numbers
3️⃣ Optimism development
4️⃣ Top 5 protocols
5️⃣ Top 5 unlaunched alpha protocols
6️⃣ Who to follow for the alpha
In this thread I'll go through
1️⃣ What is Optimism
2️⃣ Optimism in numbers
3️⃣ Optimism development
4️⃣ Top 5 protocols
5️⃣ Top 5 unlaunched alpha protocols
6️⃣ Who to follow for the alpha
2/35
1️⃣ What is Optimism?
Optimism is an Optimistic Rollup Layer 2 scaling solution built on top of Ethereum
It scales Ethereum by executing transactions off-chain and bundling them up and submitting them to Mainnet in a single transaction.
1️⃣ What is Optimism?
Optimism is an Optimistic Rollup Layer 2 scaling solution built on top of Ethereum
It scales Ethereum by executing transactions off-chain and bundling them up and submitting them to Mainnet in a single transaction.
3/35
This allows for lightning fast transactions at low costs, removing the transaction fee barrier, making it affordable to anyone
A fully decentralized L2 would derive its security from Ethereum. Optimism is moving one step closer to decentralization with the Bedrock upgrade.
This allows for lightning fast transactions at low costs, removing the transaction fee barrier, making it affordable to anyone
A fully decentralized L2 would derive its security from Ethereum. Optimism is moving one step closer to decentralization with the Bedrock upgrade.
4/35
Optimism is building an incredible powerful tech-stack with a Modular Layer 2 architecture (separating consensus, data availability and execution) in their Bedrock upgrade (more on this in 3️⃣)
This even allows them to switch to zero knowledge proofs in the future
Optimism is building an incredible powerful tech-stack with a Modular Layer 2 architecture (separating consensus, data availability and execution) in their Bedrock upgrade (more on this in 3️⃣)
This even allows them to switch to zero knowledge proofs in the future
5/35
With the introduction of Superchains and @BuildOnBase Optimism showed its plans in how they want to become the de-facto Layer 2 infrastructure tech stack.
The OP Stack will be a blueprint for all future L2s
With the introduction of Superchains and @BuildOnBase Optimism showed its plans in how they want to become the de-facto Layer 2 infrastructure tech stack.
The OP Stack will be a blueprint for all future L2s
6/35
The $OP token has already been launched and there have already been 2 rounds of airdrops, with a high probability of more in the future.
Who is the airdrops for?
Active users
(especially governance users)
The emission schedule shows lots of more Airdrops to come
The $OP token has already been launched and there have already been 2 rounds of airdrops, with a high probability of more in the future.
Who is the airdrops for?
Active users
(especially governance users)
The emission schedule shows lots of more Airdrops to come
7/35
Optimism launched its RetroPGF (Retroactive Public Funding Grant) which distributes grants to protocols building on Optimism to bootstrap activity and distribute $OP to the actual users of the protocols on Optimism
Multiple protocols are distributing incentives
Optimism launched its RetroPGF (Retroactive Public Funding Grant) which distributes grants to protocols building on Optimism to bootstrap activity and distribute $OP to the actual users of the protocols on Optimism
Multiple protocols are distributing incentives
8/35
2️⃣ Optimism in numbers
✅️ TVL
Optimisms TVL is currently $874m according to @defillama making it the second largest L2
2️⃣ Optimism in numbers
✅️ TVL
Optimisms TVL is currently $874m according to @defillama making it the second largest L2
9/35
✅️ Daily transactions
The daily transaction count was rising consistently when the Optimism Quests were ongoing but dropped sharply after it ended. Looks like Airdrop hunters was a large part of the rise in txs in early 2023
Currently Optimism has 225k daily TXs
✅️ Daily transactions
The daily transaction count was rising consistently when the Optimism Quests were ongoing but dropped sharply after it ended. Looks like Airdrop hunters was a large part of the rise in txs in early 2023
Currently Optimism has 225k daily TXs
10/35
✅️ Volume
Optimism volume is currently the 5th largest of the different chains with 7day volume at $700m
✅️ Volume
Optimism volume is currently the 5th largest of the different chains with 7day volume at $700m
11/35
✅️ Protocols
The number of protocols deployed on Optimism have not seen the same growth as on Arbitrum
According to @DefiLlama there are 112 tracked protocols on Optimism
✅️ Protocols
The number of protocols deployed on Optimism have not seen the same growth as on Arbitrum
According to @DefiLlama there are 112 tracked protocols on Optimism
12/35
3️⃣ Optimism development
The technical developments of Optimism are very impressive, and there is a big push towards decentralization, open source and making a framework for chains to collaborate seamlessly and securely
3️⃣ Optimism development
The technical developments of Optimism are very impressive, and there is a big push towards decentralization, open source and making a framework for chains to collaborate seamlessly and securely
13/35
✅ Optimism Bedrock
Bedrock is the next upcoming upgrade for Optimism. It will be the cheapest, fastest, and most advanced rollup architecture.
This is when the Modular design gets implemented and it will lead to:
✅ Optimism Bedrock
Bedrock is the next upcoming upgrade for Optimism. It will be the cheapest, fastest, and most advanced rollup architecture.
This is when the Modular design gets implemented and it will lead to:
14/35
🔴 Optimally low tx fees
🔴 Full upgradeability and future proofing
🔴 Proto-danksharding support
🔴 Security and decentralization level of Ethereum
🔴 Can switch to zk-Proofs in the future
Full thread here for further reading
🔴 Optimally low tx fees
🔴 Full upgradeability and future proofing
🔴 Proto-danksharding support
🔴 Security and decentralization level of Ethereum
🔴 Can switch to zk-Proofs in the future
Full thread here for further reading
15/35
✅️ Modular L2
Optimism is evolving into a modular Layer2 and aims for Ethereum-compability, taking it one step further than EVM-compability
Will separate the Consensus, Settlement and Execution client to be able to perform different tasks in specialized environments
✅️ Modular L2
Optimism is evolving into a modular Layer2 and aims for Ethereum-compability, taking it one step further than EVM-compability
Will separate the Consensus, Settlement and Execution client to be able to perform different tasks in specialized environments
16/35
With modular design comes the possibility to use multiple clients and multiple fraud proof methods
With this combination it will be possible to eventually remove the upgrade keys and embrace full Ethereum security on rollup.
With modular design comes the possibility to use multiple clients and multiple fraud proof methods
With this combination it will be possible to eventually remove the upgrade keys and embrace full Ethereum security on rollup.
17/35
✅️ Cannon Fraud Proofs
A next gen type of Fraud Proofs will be implemented after Bedrock.
Cannon is the world’s first EVM-equivalent fault proof implementation.
Cannon allows $OP to run the unaltered EVM on L2 with no sacrifices.
✅️ Cannon Fraud Proofs
A next gen type of Fraud Proofs will be implemented after Bedrock.
Cannon is the world’s first EVM-equivalent fault proof implementation.
Cannon allows $OP to run the unaltered EVM on L2 with no sacrifices.
18/35
✅️ OP Stack
The OP Stack is like a blueprint for Layer2s
Other L2s can build on the OP stack and make the needed modifications for a purpose-built L2.
And they already are..
✅️ OP Stack
The OP Stack is like a blueprint for Layer2s
Other L2s can build on the OP stack and make the needed modifications for a purpose-built L2.
And they already are..
19/35
Who's building on the OP Stack?
☑️ @SynapseProtocol
Crosschain Execution Chain
☑️ @BuildOnBase
Regulatory compliance.
Permissioned and KYCed defi.
USDC payment rails? (RIP visa)
☑️ @0xMantle
Built on OP stack with EigenDA Data Availability for hyper scalability
Who's building on the OP Stack?
☑️ @SynapseProtocol
Crosschain Execution Chain
☑️ @BuildOnBase
Regulatory compliance.
Permissioned and KYCed defi.
USDC payment rails? (RIP visa)
☑️ @0xMantle
Built on OP stack with EigenDA Data Availability for hyper scalability
20/35
✅ Superchain
A network of chains built on the OP Stack codebase
Superchains will share security, a communication layer, and a tech stack.
✅ Superchain
A network of chains built on the OP Stack codebase
Superchains will share security, a communication layer, and a tech stack.
21/35
The Superchain provides the scalability benefits of having many chains, but without the fractured and insecure ecosystem.
All chains building on the OP Stack will help develop the common codebase
The Superchain provides the scalability benefits of having many chains, but without the fractured and insecure ecosystem.
All chains building on the OP Stack will help develop the common codebase
22/35
4️⃣ Top 5 protocols
Here are 5 protocols i view as Optimism blue chips, because of the traction they have gained, or the innovation they bring.
I love betting on gigabrain teams
(NFA)
4️⃣ Top 5 protocols
Here are 5 protocols i view as Optimism blue chips, because of the traction they have gained, or the innovation they bring.
I love betting on gigabrain teams
(NFA)
23/35
✅️ Velodrome
$VELO @VelodromeFi
The premier liquidity marketplace on OP. A collective ecosystem pool 2.
The first successful ve(3,3) solidly dex.
All metrics hitting consistent ATHs weekly
V2 launching soon with concentrated liquidity and configurable fee switches++
✅️ Velodrome
$VELO @VelodromeFi
The premier liquidity marketplace on OP. A collective ecosystem pool 2.
The first successful ve(3,3) solidly dex.
All metrics hitting consistent ATHs weekly
V2 launching soon with concentrated liquidity and configurable fee switches++
24/35
✅️ Synthetix
$SNX @synthetix_io
Synthetix is a liquidity protocol that pioneered the creation of onchain synthetic assets, backed by a debt pool.
Large ecosystem of protocols driving fees as Real Yield to stakers
V3 coming sooon
✅️ Synthetix
$SNX @synthetix_io
Synthetix is a liquidity protocol that pioneered the creation of onchain synthetic assets, backed by a debt pool.
Large ecosystem of protocols driving fees as Real Yield to stakers
V3 coming sooon
25/35
✅️ Lyra
$LYRA @lyrafinance
On-chain Options trading protocol based on an automated market maker (AMM) where you can buy/sell call or put options on ETH, BTC
Built on top of $SNX
Delta hedged LP vaults, tight spreads, real yield, modular architecture
✅️ Lyra
$LYRA @lyrafinance
On-chain Options trading protocol based on an automated market maker (AMM) where you can buy/sell call or put options on ETH, BTC
Built on top of $SNX
Delta hedged LP vaults, tight spreads, real yield, modular architecture
26/35
✅️ Kwenta
$KWENTA @Kwenta_io
Trade synthetic perpetuals with up to 25x leverage
Unlike other leverage platforms, Kwenta does not require liquidity at a protocol level. It uses sUSD, so liquidity is provided by $SNX stakers on Synthetix.
Driving insane volume to SNX
✅️ Kwenta
$KWENTA @Kwenta_io
Trade synthetic perpetuals with up to 25x leverage
Unlike other leverage platforms, Kwenta does not require liquidity at a protocol level. It uses sUSD, so liquidity is provided by $SNX stakers on Synthetix.
Driving insane volume to SNX
27/35
✅️ Sonne Finance
$SONNE @SonneFinance
The largest Optimism-native lending/borrowing protocol.
Deploying an impressive flywheel with @VelodromeFi and delivering real yield to stakers.
✅️ Sonne Finance
$SONNE @SonneFinance
The largest Optimism-native lending/borrowing protocol.
Deploying an impressive flywheel with @VelodromeFi and delivering real yield to stakers.
28/35
5️⃣ Top unlaunched alpha protocols
Some upcoming protocols that i'm very interested in and think have great potential in the future
5️⃣ Top unlaunched alpha protocols
Some upcoming protocols that i'm very interested in and think have great potential in the future
29/35
✅️ Ethos Reserve
$ERN @EthosReserve
A CDP stablecoin by @ByteMasons $OATH ecosystem
Based on @LiquityProtocol $LUSD, but allows ETH and WBTC collateral, and earns yield on collateral. Real Yield to $OATH stakers
Launching on OP in Q2
✅️ Ethos Reserve
$ERN @EthosReserve
A CDP stablecoin by @ByteMasons $OATH ecosystem
Based on @LiquityProtocol $LUSD, but allows ETH and WBTC collateral, and earns yield on collateral. Real Yield to $OATH stakers
Launching on OP in Q2
31/35
✅️ Avantis Finance
@AvantisFinance
Leverage trading platform for crypto and forex
Omni-chain stable LP with risk tranches
Up to 100x leverage
✅️ Avantis Finance
@AvantisFinance
Leverage trading platform for crypto and forex
Omni-chain stable LP with risk tranches
Up to 100x leverage
32/35
🚨 Disclaimer
None of this is financial advice, this is purely for educational purposes.
Just because i mention a protocol here does not mean that right now is a good entry or that i hold the asset
🚨 Disclaimer
None of this is financial advice, this is purely for educational purposes.
Just because i mention a protocol here does not mean that right now is a good entry or that i hold the asset
33/35
6️⃣ Who to follow for Optimism alpha
@Subli_Defi
@drakeondigital
@Route2FI
@0x_____________
@TrustlessState
@BarryFried1
@cyrilXBT
@DeFiMinty
@WinterSoldierxz
@mastermojo83
@napgener
@blocmatesdotcom
@DefiIgnas
@563defi
@Cryptotrissy
@DefiIntro
@rektdiomedes
@crypto_linn
6️⃣ Who to follow for Optimism alpha
@Subli_Defi
@drakeondigital
@Route2FI
@0x_____________
@TrustlessState
@BarryFried1
@cyrilXBT
@DeFiMinty
@WinterSoldierxz
@mastermojo83
@napgener
@blocmatesdotcom
@DefiIgnas
@563defi
@Cryptotrissy
@DefiIntro
@rektdiomedes
@crypto_linn
34/35
And tagging some defi enjoyooor who shouldn't fade Optimism
@Chinchillah_
@DeFiMinty
@0xFlips
@0xsurferboy
@CryptoShiro_
@DAdvisoor
@defi_mochi
@0xSalazar
@TheDeFISaint
@0xKickflip
@rektfencer
@CJCJCJCJ_
@_FabianHD
@kindahangry
@burstingbagel
@Louround_
@CryptoKoryo
And tagging some defi enjoyooor who shouldn't fade Optimism
@Chinchillah_
@DeFiMinty
@0xFlips
@0xsurferboy
@CryptoShiro_
@DAdvisoor
@defi_mochi
@0xSalazar
@TheDeFISaint
@0xKickflip
@rektfencer
@CJCJCJCJ_
@_FabianHD
@kindahangry
@burstingbagel
@Louround_
@CryptoKoryo
35/35
Thats a wrap
Follow me @Slappjakke for more alpha and more chain deepdives
Comment your favourite Optimism protocol below so I can take a look at it
Like and Retweet the first tweet below if you enjoyed this thread so others can see
Thats a wrap
Follow me @Slappjakke for more alpha and more chain deepdives
Comment your favourite Optimism protocol below so I can take a look at it
Like and Retweet the first tweet below if you enjoyed this thread so others can see
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