Optimism (OP)

From CryptoWiki

Revision as of 08:49, 20 December 2021 by wiki_crypto>Zeb.dyor
(diff) ← Older revision | Latest revision (diff) | Newer revision → (diff)

Basics

  • Based in:
  • Aka The OΞ protocol
  • Founded in: 2019
  • Mainnet release: fully permissionless release was on 17-12-2021.

"Optimism is a Public Benefit Corporation dedicated to scaling Ethereum in a way that enshrines fair access to public goods."

"Optimism is an Ethereum layer-2 scaling solution that uses Optimistic Rollups to process many transactions off-chain while retaining the L1 security guarantees of Ethereum. Importantly, it also separates the roles of transaction ordering, and block validation into two distinct parties."

History

  • Formerly known as Plasma Group — a nonprofit researching Ethereum scalability, managed to raise $3.5m and transition to a for-profit startup under the name Optimism.
  • From Deribit Insights (8-7-2021):

"In mid 2017, Vitalik Buterin and Joseph Poon co-authored a paper proposing Plasma, an early scaling solution for Ethereum. A group of core Ethereum researchers took up the mantle and formed a non-profit research group to build out the vision. Development stalled in late 2019, as some critical design limitations of Plasma became apparent. Undeterred, three of Plasma’s lead researchers—Karl Floersch, Jinglan Wang, and Ben Jones—decided to pivot toward what seemed to be Plasma’s natural successor, the Optimistic Rollup. They formed Optimism PBC in early 2020."

Audits & Exploits

Bugs/Exploits

Governance

Admin Keys

  • Fully permissionless release was on 17-12-2021.
  • From their blog (16-1-2021):

"The most effective security approach for our current needs starts with a layered defense in depth strategy, combined with audits when it makes sense. These layers of defense are centralized, and as we gain confidence in the system they will be removed. Until then, please do not consider this the full and final protocol. While we have dealt with all of the major security issues surfaced through multiple internal reviews of the contracts, as well as consultations with external auditors, we are launching with several additional safeguards.

  1. Defense Layer #1: Permissioned contract deployment. The most probable way to bypass the core security is through deploying a malicious contract that breaks the OVM’s L2 sandbox. To minimize this risk, we are temporarily maintaining a whitelist of deployers until a later release.
  2. Defense Layer #2: Authenticated withdrawals. If the first line of defense is breached, then the next risk is invalid withdrawals. To prevent this, we have added a check that allows us to investigate pending withdrawals and stop misbehavior before it hits L1.
  3. Defense Layer #3: Upgrade keys. The final layer of defense relies on admin keys which can be used to upgrade the contracts in emergencies. We also plan to use these keys on a bi-monthly basis to ship scheduled improvements and new features."

DAO

Treasury

Token

Launch

Token allocation

Utility

Token Details

Stablecoin

Coin Distribution

Technology

  • Whitepaper can be found [insert here].
  • Code can be viewed [insert here].
  • Built on: Ethereum
  • Programming language used:

Transaction Details

How it works

Fee Mechanism

Upgrades

"Optimism released their Optimistic Rollup testnet last week with Synthetix as a launch partner. They also detailed the testnet rollout plans and the path towards mainnet."

Staking

Liquidity Mining

Different Implementations

Interoperability

Other Details

Optimism & MEVA

"Importantly, the Optimism system enables the capture and repurposing of MEV. In the Optimism L2 system, the roles that miners have (to order transactions and validate blocks) is divided into two separate actors: Sequencers order transactions and Validators add them to the Optimism L2 blockchain.

The right to become a sequencer is then auctioned off to the free market. This is called MEVA, or MEV Auctions, where the right to be able to capture MEV is repeatedly auctioned off for baskets of time.

Note: The specific designs around how a MEV Auction works in practice is still under construction, but the general idea is that there are different ways to extract and focus MEV with a free-market auction mechanism. As Optimism gets rolled out to more and more DeFi apps, the data will come in about how to best construct a MEVA.

Just as frontrunners attempted to outbid each other’s transactions to capture MEV, those who wish to capture MEVA are forced to bid for the right to sequence transactions, and ultimately hands this value off to the auctioneer. That auctioneer is Optimism, and the Optimism team intends to enable the redirecting of this captured value to parties that were never going to be able to access it in the first place, but arguably should have: The developers who built the contracts in the first place!

If there’s a group of average retail market participants who are using a Public Good like Uniswap, then there is therefore MEV. If there is MEV, there are bids to sequence the transaction. If there are bids to sequence the transactions, then there are MEVAs where the value is converged.

But this entire chain of economic activity is a result of some developer that built the contracts being transacted on in the first place… and nowhere in this economic chain is the developer being compensated or rewarded for their work. Optimism and MEVA fixes this, offering a potential business model for smart-contract developers."

Oracle Method

  • Chainlink price feeds are now live on the Optimistic Ethereum network (1-9-2021).

Privacy Method

Compliance

Their Projects

"Synthetix and Optimism are extremely excited to announce a new demo of Synthetix.Exchange on OVM (Optimistic Virtual Machine), a Layer 2 (L2) scaling solution. This integration demonstrates the power of OVM to deliver high-speed Ethereum transactions to supercharge the Synthetix trading experience.

Optimism built the OVM to scale Ethereum on L2, a scaling layer intended to work with Ethereum L1 to allow vastly more transactions to be executed without security tradeoffs. The Optimism team has previously launched a demo with Uniswap at Devcon V in October 2019, which used a custom OVM. This new demo showcases a general alpha version of the OVM requiring no custom code, ahead of a launch later this year."

Roadmap

  • Can be found [Insert link here].
  • From their 2020 year-end article (1-1-2021):

"Two weeks ago, we froze our code in order to prepare for a preliminary mainnet trial run with Synthetix. This means we are in the final legs of taking our first users through the entire product lifecycle: from the initial stage of converting contracts to the OVM, to deploying onto mainnet.

We will be holding upgrade keys for awhile (at least the first 6 months) to ensure the safety of user funds. Until we relinquish those keys, please do not consider this the full and final system."

  • Mainnet got delayed (26-3-2021) to sometime in July 2021 after first being scheduled for March.

Usage

"Uniswap V3 on Optimism has over $4.25 million in TVL, and is doing over $1.75 million in volume in under 48 hours!"

Projects that use or built on it

Competition

"The simplest way to describe the difference is that Optimism’s dispute resolution relies more heavily on the Ethereum Virtual Machine (EVM) than Arbitrum’s. When someone submits a challenge on Optimism, the entire transaction in question is run through the EVM. By contrast, Arbitrum uses an offchain dispute resolution process to whittle down the dispute to a single step within a transaction. The protocol then sends this single step assertion, as opposed to the entire transaction, to the EVM for final verification. Conceptually, Optimism’s dispute resolution process is thus considerably simpler than Arbitrum’s. Optimism’s approach to dispute resolution—i.e. running entire transactions through the EVM—is not just conceptually simpler: it’s quicker too. There aren’t “multiple rounds” of back and forth, as there are in Arbitrum’s process. In fact, for this reason, Optimism’s rollups are often called “single round” whereas Arbitrum’s are “multi round.” Practically speaking, this means that in the case of a disputed transaction, final confirmation on Ethereum is delayed in Arbitrum’s case longer than it is in Optimism’s case.

On the flip side, the advantage of Arbitrum’s dispute resolution is that it is cheaper in terms of onchain (i.e. on Ethereum) transaction costs. The bite-sized chunk of code that the EVM eventually processes after the completion of the back-and-forth dispute resolution process requires much less gas (in most cases) than it does to re-process the entire transaction onchain. Arbitrum should be more gas efficient than Optimism—and therefore cheaper for users—not only in the rare case of a dispute, but also in the predominant “happy” case."

"The biggest distinction is what happens when two parties disagree on the state after executing a tx ie. implementation of the fraud proof (FP) mechanism. Optimism uses single round fraud proofs. This means that L1 executes the whole L2 transaction on-chain to verify the state root. This makes FPs instant which is nice. But there are some problems too:

• you need to supervise tx execution hence need for OVM (aka rewriting EVM to avoid sideeffects) • L2 tx gas is bound by L1 block gas limit • you need on-chain state roots after each TX - costs more :( • source of potential security issues

Arbitrum features multi-round fraud proofs. You can dumb it down to doing a binary search between two parties to find the first opcode of a whole block that they disagree on. Once found only this particular opcode is executed on-chain. It has some nice properties:

• it requires posting on-chain just one state proof for a whole bunch of txs, • L1 block gas limit doesn't matter since L2 txs will never entirely execute on L1

Drawbacks: • It requires EVM -> AVM translation (thankfully it's automatic) • it's slow - in the worst case it takes up to 2 weeks to finish FP. Realistically it's 1 week. • requires original claimer to be online and cooperative

Optimism's approach has one *HUGE* drawback. Imagine that there is a hardfork and Ethereum consensus rules change. One of the opcodes is removed/repriced or modified in some other way. Suddenly re-executing past tx on L1 will result in a different final state. Arbitrum fully controls AVM specs and doesn't have this problem.

Optimism requires a special solidity compiler to generate OVM bytecode. So, unfortunately, it works only with Solidity and only with particular versions of solidity. On the other hand, their L2 node is just modified geth which is great for compatibility.

Arbitrum on the surface is fully compatible with EVM/JSON RPC spec but their node is a custom implementation. It does automatic EVM→ AVM transpilation to support fraud proofs. Thanks to this low-level translation, it supports any EVM language (vyper, YUL+ etc).

Optimism uses weth but Arbtirum has native eth support. Optimism launches with wallet abstraction built in too. Arbitrum launches with a unified permissionless bridge to bridge any tokens to L2 (it deploys generic ERC20 as a L2 counterpart). Optimism prefers dedicated bridges but of course, deploying "unibridge" on optimism is possible as well."

Pros and Cons

Pros

Cons

"Joseph Delong said he believed Optimism favored Uniswap because of influence from the investors Andreesen Horowitz (a16z) and Paradigm. Both funds have made investments in Uniswap and Optimism, as well many other leading crypto projects.  According to Delong, the two VCs may have “colluded” to influence and benefit their vested projects."

Team, Funding, Partners

Team

  • Full team can be found [here].
  • Eva Beylin, previously worked with them
  • From DeFi Weekly (9-3-2021): "The team that Optimism has rallied is pretty incredible if you dig deeper."

Funding

Partners 

(:

Knowledge empowers all and will help us get closer to the decentralized world we all want to live in!

Making these free wiki pages is fun but takes a lot of effort and time.

If you have enjoyed reading, tips are appreciated :) This will help us to keep expanding this archive of information.

ETH tip address: 0x83460bE5F218b1520B69D702cE60A1DE37dD8E31

Retrieved from "https://cryptowiki.me/index.php?title=Optimism_(OP)&oldid=11245"