Andreessen Horowitz leads $25M spherical for Optimism's L2 scaling answer

Optimism, an organization offering Layer 2 scaling options for Ethereum, has secured backing from enterprise capital agency and Coinbase investor Andreessen Horowitz, or A16z.

Andreessen Horowitz, which manages a portfolio value roughly $16.6 billion, introduced it’s main Optimism’s $25 million Sequence A funding spherical on Feb. 24.

The demand for Layer 2 scaling options has escalated amid Ethereum’s surging charges, with common transaction prices pushing as excessive as $40 on Feb. 23.

To attain decrease charges, decrease latency, and larger throughput in comparison with transacting on Ethereum’s Layer 1 essential web, Optimism makes use of “rollups” to bundle transactions collectively utilizing sensible contracts on an Ethereum side-chain earlier than broadcasting them to the mainnet.

Ethereum co-founder, Vitalik Buterin, summarized that “rollups transfer computation (and state storage) off-chain, however preserve some information per transaction on-chain.”

A16z acknowledged that the expansion of Ethereum over the previous 12 months or so has been a powerful indicator of demand, noting the typical capability of Ethereum blocks has stabilized close to 98% — that means the community is functionally full.

“One lesson from web historical past is that whenever you give builders a robust new computing platform, they create purposes at such a fast fee that demand persistently outpaces provide. We consider the identical shall be true for Ethereum,”

The announcement notes that A16z spent vital time exploring totally different Layer 2 scaling options earlier than the agency selected to help Optimism.

The agency emphasised that Optimism’s philosophical and technological alignment with Ethereum was a major issue informing their choice to again the crew, writing:

“Probably the most thrilling issues about what Optimism has constructed is that it may be seen in some ways as an extension of Ethereum — from its philosophy all the way down to its tech stack.”

Optimism is at the moment finishing a phased rollout and shall be prepared for large-scale manufacturing later this 12 months. The platform has been working testnets in partnership with DeFi platform Synthetix, and has began hiring to expedite public mainnet launch — which is now scheduled for March.