Arbitrum (ARB)

Decentralized Finance (DeFi)

Arbitrum is used to run DeFi platforms like Uniswap, SushiSwap, and Aave, enabling faster and cheaper transactions compared to Ethereum’s mainnet.

Gaming and NFTs

It supports blockchain games and NFT projects by providing high-speed, low-cost transactions, making it easier to trade and interact with digital assets.

Smart Contracts and dApps

Arbitrum allows developers to deploy Ethereum-compatible smart contracts with improved scalability and lower fees, helping build more efficient decentralized applications.

Governance

The ARB token is used for governance, letting holders participate in decisions about the network’s future through the Arbitrum DAO.

Layer 2 Scaling Solution

Arbitrum improves Ethereum by processing transactions off-chain using Optimistic Rollups, which increases speed and reduces gas fees while maintaining security.

Pros

• Arbitrum allows token holders to participate in governance through voting in its DAO.
• Users can earn staking rewards by delegating tokens to staking pools.
• It significantly increases transaction throughput while maintaining security.
• Supports up to 40,000 transactions per second with low fees.
• Fully compatible with Ethereum Virtual Machine (EVM), so existing Ethereum dApps can run on it.
• Has a large and active developer community.
• Backed by major investors and well-known blockchain ventures.

Cons

• The price of Arbitrum tokens has experienced significant volatility.
• Uses optimistic rollups, which include a challenge period that can delay transaction finality.
• Some centralization concerns exist because certain actors maintain the network with permission.
• A large portion of tokens is frozen or controlled by developers and consultants, affecting distribution transparency.

Founders of Arbitrum

The founders of Arbitrum are Ed Felten, Steven Goldfeder, and Harry Kalodner. They are former Princeton University researchers with expertise in computer science, cryptography, and distributed systems. Ed Felten serves as Chief Scientist, Steven Goldfeder is the CEO, and Harry Kalodner is the CTO of Offchain Labs, the company behind Arbitrum.

Institutional Investors

Arbitrum has 9 institutional investors including Delphi Ventures, Compound, Coinbase, SNZ, Spartan Group, and IOSG Ventures.

Venture Capital

Early venture capital investors include Pantera Capital, Lightspeed Venture, and Alameda Research.

Other Notable Investors

Paradigm and Griffin Gaming Partners are co-investors backing projects within the Arbitrum ecosystem.

These investors have supported Arbitrum through seed and funding rounds, helping it grow as a leading Ethereum layer-2 scaling solution.

Halal Status of Arbitrum

Yes, Arbitrum is generally considered halal. It is a Layer 2 scaling solution for Ethereum that focuses on improving transaction speed and lowering costs without involving interest (riba) or gambling. Its main use is technical and governance-related, which aligns with Islamic finance principles when used properly.