OP, the native token for the Optimism layer 2 network, is up by 20% over the past week. The token created an all-time high on February 3 of $3.19 amid notable developments surrounding the projects, such as the proposed Bedrock upgrade and the launch of Binance USD (BUSD) on the network. These developments also have spiked Optimism’s total value locked (TVL).
Optimism proposed the Bedrock upgrade
Last week, Optimism proposed a mainnet upgrade to boost the performance of the Ethereum layer 2 scaling system. The Optimism Foundation tabled a proposal for this upgrade in the governance forum. The community will start voting on the proposals in two weeks, and if approved, the network will be upgraded on March 15.
Bedrock is a rollup that was created by Optimism. Rollups help speed up transactions on a blockchain by bringing together hundreds of transactions in one mainnet block. The process also reduces fees. The Bedrock upgrade is set to unlock major benefits for Optimism users, such as faster speeds and lower transaction fees.
We're extremely excited to put this historical proposal in front of the Token House. We see Bedrock as the culmination of years of R&D—and the next crucial step towards a modular, simplified, and performant multi-chain future.https://t.co/urk6U9aABj pic.twitter.com/ebxsvtBM8N
— Optimism (✨_✨) (@optimismFND) February 1, 2023
The upgrade is also expected to pave the way for improvements in the future that will help Optimism become more competitive against rivals such as Arbitrum. The Optimism Foundation expects that the mainnet upgrade will make Optimism the most cost-friendly rollup on the Ethereum blockchain, which could drive adoption and bolster the TVL.
“The Bedrock release of the OP Stack represents the culmination of years of research and development by the Ethereum scaling community and is a complete rewrite of the core components of the optimism architecture,” the proposal says.
The crypto community has lauded this proposal because of the potential it will unlock for Optimism. According to an analysis published in October last year, Optimism will set the record as the first rollup on Ethereum that has delivered an Ethereum-level security.
Binance USD deploys on Optimism
Last week, exchange giant Binance, which is the largest centralized exchange by trading volumes, announced it would be launching its Binance USD stablecoin on Optimism. The launch marked the sixth network development for the stablecoin currently supported on Avalanche, BNB Chain, Ethereum, Polygon, and Tron.
— Binance (@binance) February 2, 2023
BUSD ranks as the third-largest stablecoin after Tether (USDT) and USD Coin (USDC), with a market capitalization of $16.26 billion. The launch will let users deposit and withdraw BUSD tokens on the Optimism network. A day after this launch, the native OP token rallied to a record high. The token is up by more than 170% over the past month.
The Optimism TVL has also been steadily recovering since the year started. The decentralized finance (DeFi) protocols on the network have also made notable gains, with the top DApps on the network being Velodrome Finance, Synthetix, Curve, Aave, and Uniswap. The planned mainnet upgrade could boost the adoption of Optimism by more DApps, which will result in more gains in TVL and the value of the OP token.
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