Can Optimism compete in the layer 2 race with these new developments?

• A brand new shopper program for the OP Stack ecosystem may show to be helpful for the Optimism protocol.
• The protocol falls behind different Layer 2 options in numerous areas corresponding to exercise and income.

Regardless of initially establishing a dominant presence within the Layer 2 (L2) sector upon getting into the market, Optimism‘s efficiency has since been surpassed by different protocols corresponding to Polygon and Arbitrum in numerous areas.

Learn Optimism’s [OP] Worth Prediction 2023-2024

Present of the Magi

The addition of the Magi to the Optimism protocol may affect it positively. Magi is a not too long ago developed shopper program designed to boost the variety and resilience of the OP Stack ecosystem.

Developed in Rust, Magi capabilities as a consensus shopper, generally known as a rollup shopper, and enhances execution purchasers like op-geth to synchronize transactions on the community. Whereas OP Labs maintains the reference implementation known as op-node, Magi performs the identical performance, albeit with the additional advantage of being a novel resolution.

It’s value noting that Magi shouldn’t be but a production-ready shopper and shouldn’t be thought of as such. Nonetheless, it has already demonstrated its compatibility with each Optimism and Base testnets, making it appropriate for experimental functions.

Introducing Magi 🟠, our model new OP Stack rollup shopper written in Rust.

We have been engaged on Magi to assist enhance the shopper range and resilience of all the OP Stack ecosystem.

Lets dive in.

code: https://t.co/U8ER6v2SSe
weblog: https://t.co/A4Tx8iaVOh pic.twitter.com/S5hDbx5Q4R

— ncitron.eth (@NoahCitron) April 19, 2023

Again to the current

At press time, Optimism was nonetheless underneath assault on account of a major variety of challenges. When it comes to day by day exercise on the protocol, Optimism wasn’t in a position to compete with networks corresponding to Polygon and Arbitrum.

Over the previous few weeks, the variety of day by day energetic addresses on the Optimism community declined from 82,000 to 42,000.

The protocol was additionally unable to compete with different options by way of saving ETH for its customers. In accordance with Dune Analytics’ knowledge, Arbitrum was outperforming Optimism by a big margin on this regard.

Supply: Dune Analytics

Ought to holders be ‘OP’timistic?

Optimism’s native token OP confronted the results of the aforementioned data. The previous few weeks noticed a drastic fall within the velocity of the OP token. This indicated that OP’s buying and selling frequency witnessed a decline.

Coupled with that, OP’s community development began to fall. This additional indicated a fall within the variety of new addresses transferring OP for the primary time.

Real looking or not, right here’s OP’s market cap in BTC’s phrases

Regardless of the declining worth of OP, the MVRV ratio remained constructive. This implied that there have been nonetheless addresses left that have been worthwhile that might have the inducement to promote their holdings for income sooner or later.

Supply: Santiment