Arbitrum (ARB): The Layer-2 Scaling Solution 

By Tokenize Xchange
April 06, 2023

The Arbitrum network, developed by Offchain Labs, is a high-speed layer-2 rollup mechanism. Today we will explain what Arbitrum is, how it works, how it benefits users, and how to buy ARB token – the newly listed token on Tokenize Xchange. Let’s find out!

what is arbitrum ARB

What is Arbitrum?

Arbitrum is a Layer 2 scaling solution that addresses Ethereum’s scalability issues. Layer 2 is a  system that runs on Layer 1. It is supposed to inherit the security of Layer 1 while also being able to process more transactions, lower costs, and have a faster confirmation speed. 

The architecture of Arbitrum ecosystem 

The Arbitrum ecosystem is operated by 4 roles: 

  • Verifiers: A distributed protocol that tracks the transaction legitimacy and in charge of validating accepted transactions
  • A virtual machine (VM): A protocol virtual participant whose operations are defined by codes and data.
  • A key: A protocol member who can own currency and propose transactions by signing them using the transaction’s private key.
  • A manager: A virtual machine (VM) manager in charge of keeping track of the VM’s progress and making sure it works correctly. 

Arbitrum is based on a basic cryptocurrency concept in which parties can create a smart contract as a virtual machine (VM) that encodes the contract’s rules. 

Parties who can benefit from VM can select someone they trust to act as managers on their behalf or act as managers themselves. In practice, many contracts will have a rather limited natural set of managers.

Also, the Verifiers keep track of the hash of the VMs rather than the entire network. Furthermore, the network incentivizes managers to reach out of band agreement on the operation of the VMs.

How does Arbitrum work?

Arbitrum uses a mechanism protocol named optimistic rollup. This technique improves the scalability of Ethereum smart contracts by delivering messages between smart contracts and those in the Arbitrum second chain layer.

Furthermore, the majority of transaction processing will be conducted at layer-2, with Arbitrum recording the outcomes in the main chain. Hence, it allows the system to significantly boost its working speed and efficiency.

Basically, individuals and smart contracts make requests to Arbitrum’s blockchain by submitting transactions to the chain’s “inbox.” Arbitrum then processes it and generates a transaction receipt. The transactions in Arbitrum’s inbox decide how the transaction is processed—what determines its “chain state.”

Sell Cryptocurrency Online Singapore

Advantages of Arbitrum

High EVM compatibility

Arbitrum is regarded as one of the most EVM-compliant blockchains which can be bytecode compatible with EVM, and any language, including Solidity and Vyper, can be built to EVM.

This makes development easier because developers no longer need to learn a new language before working on Arbitrum.

Low Cost

As a layer-2 scaling solution for Ethereum, Arbitrum is not only designed to increase Ethereum transaction throughput. But at the same time, it also minimizes transaction costs.

Thanks to this highly efficient roll-up technology, Arbitrum can cut costs to a minimum. Although the transaction costs are lower, the project still provides sufficient incentives for validators.

Powerful Developer Tools

The project team has made extensive efforts to reduce bottlenecks when developing a layer-2 solution. Hence,  they have created extensive developer documentation for Arbitrum, and developers can begin using tools that are already available on Ethereum.

Developers no longer need to download project-specific software, such as a plugin or a compiler such as Hardhat or Truffle.

What is the ARB token?

ARB is listed on Tokenize Xchange

ARB is the native token of Arbitrum Network. 

The native token ARB, which recently went through a hyped airdrop and was recently listed on Tokenize Xchange, is utilized for governance and staking. Offchain Labs, the firm responsible for developing Arbiturm, has announced a move to a decentralized autonomous organization (DAO), where ARB holders can now vote on various ideas for the platform’s future.

>>> Buy ARB 

Arbitrum performed an epic airdrop in which early investors were eligible for tokens. The airdrop received nearly 12.75% of the overall supply, which was approximately 1.162 billion. Each user was expected to receive about 625 tokens, the amount of which was entirely contingent on their participation with the Arbitrum Network.

At the time of writing, ARB price is $1.279.

  • Market Capitalization: 1.76 million 
  • Circulating Supply: 1.27 billion
  • Total Supply: 10 billion
  • Consensus Method: Proof of Stake

How to buy ARB tokens?

Investors can easily buy ARB from Digital Asset Exchange Platforms. Below are 5 steps to buy ARB on Tokenize Xchange

Step 1: Select Trade on your dashboard. 

Step 2: Choose the market on the right of the dashboard

For example, click on the SGD Markets tab, and under the tab, you will see ARB/SGD

Step 3: Choose the type of Buying

3.1. Limit Buy

A limit order will be filled at or better than a specified price. Any quantity that is not filled rests on the continuous order book until it is filled or canceled.

Your Balance: SGD balance left in your account.

Price per ARB: the price to buy for 1 ARB in SGD.

Amount ARB: Key in the amount of ARB to buy.

Time In Force:

  • Good Till Cancelled (GTC): Your order will stay on the order book until they have been completely filled or until you manually cancel them.

3.2 Market Buy

A market order is an order that will be executed immediately and in full by buying or selling from the bids and asks in the order book.

Your Balance: SGD balance left in your account.

Market: Your order will be filled immediately at the best market price at the time of your order.

Amount: Key in the amount of ARB to buy.

Sell: Once the Amount is filled correctly, you may click on Buy ARB to confirm your Total Bid.

>>> Read more: Market, Limit, and Stop Order: What is the difference?

Step 4: Confirm your order.

You will see a confirmation window. Check all details carefully. Please see the trading commission fee here. Click “Confirm” to proceed or “Cancel” to cancel the transaction.

For example: If you would like to buy 100 ARB, you can select Market order, enter your quantity as 0.1 and confirm your order. You will then buy 100 ARB from the market.

After confirming the order, you will see a green notification at the top of the page indicating that your order has been successfully placed.

Step 5: Finish the order

Your order will be matched automatically. You may view your order by selecting “Orders” and “Finished Orders”.

Under “Finished Orders”, you are able to view your completed orders.

How to cancel buy order

Click on “Pending Orders” to view all of your pending orders. 

Each order will show detailed information such as Date, Market, Side, Order Type, Price, Total Units, Amount, and Filled.

For orders that are still pending, you can click on “Cancel” to cancel your order.

trade now on Tokenize Xchange button

This article has helped you answer the question What is Arbitrum (ARB), How does Arbitrum benefit users? and How to buy ARB? Don’t hesitate to share your opinion, and don’t forget to follow Tokenize Xchange – Crypto Exchange Platform Singapore for more interesting blockchain articles! 


Cryptocurrencies are subjected to high market risk and volatility despite high growth potential. Users are strongly advised to do their research and invest at their own risk.