How To Launch Custom Layer 3 On Ethereum with Arbitrum Orbit

An optimistic rollup-based framework called Arbitrum Orbit was created to enable web3 enterprises to create unique, use-case-specific Layer 2 or Layer 3 chains in an utterly permissionless manner. Orbit uses the Arbitrum Nitro Tech stack, which provides all Arbitrum Orbit chains with unmatched scalability, sophisticated compression, complete EVM compatibility, and interoperability across chains. Arbitrum Orbit is the deployable and configurable instances of the Nitro stack that collectively create an ecosystem of separate chains.

What is Blockchain Scaling With Arbitrum Orbit?

Based on the Arbitrum Nitro technology, the Arbitrum Orbit stack is a framework that can be customized to create customized Layer 2 (L2) or Layer 3 (L3) blockchains. It provides a scalable and adaptable way to implement decentralized applications, improving control over cost and performance. Building upon Layer 2 protocols, Layer 3 protocols offer increased scalability, enabling developers to design blockchains tailored to the demands of individual applications.

Usually created for a particular decentralized application (dApp), Layer-3 blockchains are constructed on top of Layer-2 networks. Developers and users may benefit from Layer 3, which includes reduced gas costs, faster transactions, and greater customization. Nevertheless, they also have several disadvantages, which could make them less secure than L1 and L2 chains because they inherit both the Layer-1 and Layer-2 underlying security.

The Key Advantages of Arbitrum Orbit Scaling Service

The key advantages of Arbitrum orbit scaling services are precisely discussed below.

1. Customizable & dedicated throughout

High-traction dApps, such as gaming and cryptocurrency trading platforms, require massive scalability. These platforms frequently must modify their ecosystem's throughput capacity in response to traffic flow. Orbit chains eliminate your need to compete with other dApps for storage or processing power by managing your dApp on a separate, independent chain.

2. EVM+ Compatibility of Stylus

Stylus adds multi-VM support capabilities that are advantageous for L2/L3 orbit chains. This implies that developers can fully preserve compatibility while writing smart contracts in the languages of their choice, such as Solidity, C++, Rust, or C. Smart contract programming is generally supported for any language that compiles to Arbitrum's WASM VM.

3. Unparalleled Customisation

Arbitrum-based L3 development Orbit allows users to modify several network features. For instance, users can create their own governance protocol, make a bespoke ERC-20 token the native token of their chain, or alter the chaining functionality (such as execution, settlement, DA, etc.) to suit specific requirements.

4. Predictable gas cost

For many dApps that wish to estimate their business expenses and subsequently employ cost-prohibitive tactics like transaction fee subsidization, transaction/gas cost predictability is crucial. Because Orbit chains are separate from underlying Layer 1s like Ethereum or Arbitrum L2s and do not share an ecosystem, doing this is simpler for them.

5. Broad Data availability (DA) options

Due to Arbitrum Orbit's wide range of data availability options, L3s can construct their chain as an Arbitrum rollup or Arbitrum AnyTrust chain. While AnyTrust uses a data availability committee (DAC) to store raw transaction data off-chain and provide customers with significantly lower gas costs, Rollups permit the usage of Ethereum Layer 1 as the DA layer.

6. Quick launch for faster time-to-market

As the low-code approach to rollup launch has gained popularity, Arbitrum Orbit gives developers the option to use the Orbit chain deployment portal or select from a variety of Rollups-as-a-Service (RaaS) providers that promise a speedy launch of your Orbit chain with their pluggable integrations, low-code deployment platforms, and cutting-edge developer tools.

7. Robust security guarantee

With Arbitrum Nitro and Ethereum's inherent security, Arbitrum remains dedicated to powering the most L2 across various businesses. Arbitrum Orbit scaling can use this same strong and established technology stack to keep their chain's security strong.

8. Flexible technology stack

In the Arbitrum Orbit stack, flexibility means that Arbitrum Orbit scaling L3 can select between a Layer3 chain, AnyTrust chain, or L2 rollup. Rollups enable them to inherit Layer 1 security while guaranteeing massive scalability through off-chain processing, which is far less expensive than L1.

9. Permissioning feature

Like Ethereum, orbit chains can open their environment to all users or grant permissioned access. This means that, depending on the level of privacy you want, you may either make your chain permissionless or limit the deployment of smart contracts so that only your dApps can use it.

10. Support for Roll Ups modularity

Because Arbitrum Orbit strongly emphasizes modularity, other rollup components can be seamlessly integrated into Orbit and Arbitrum Layer 2 chains. For instance, you can utilize a wallet, a decentralized sequencer, and an explorer with unique features and integrate an off-chain DA layer.

11. Freedom to use execution environments

The execution environment of various Arbitrum chains can be fully or partially restricted. For instance, even while Arbitrum chains are EVM-compatible, Orbit chains simplify their projects by limiting certain smart contract functions.

12. Independent product roadmap

Due to Orbit, the roadmap of your L3 chain can be isolated from that of Layer 1 Ethereum or Arbitrum L2s. This implies that you can implement advanced features like Account Abstraction (AA) on your network even if the base chain Arbitrum public chains do not yet have the functionality enabled.

13. Interoperability with Chain clusters

Interoperability between orbit chains still looks like a big task, even though they are part of an ecosystem of linked L2 or L3s. Chain clusters, which are effectively a communication layer, were invented by Arbitrum to address this issue. They allow quick token/resource transfers across freestanding layer 2 and layer 3s.

The Potential Benefits of L3 Blockchain Development with Arbitrum Orbit

There are many core benefits of Arbitrum Orbit scaling L3 on blockchain, some of which are discussed below.

1. Customizable Governance: Many L3 chains allow more governance customizability than L1 and L2 chains, although the level of customizability might vary depending on the L1 and L2 chains an L3 is built on.

2. Privacy: In certain situations, L3 chains can give developers more privacy options, which many users may find significant.

3. Adjustable Tokenomics: The greater flexibility that many L3 networks give developers when issuing tokens can aid staking, vesting, and other crucial components of tokenomics.

4. Additional Interoperability: Orbs and other L3 chain development networks can be constructed on top of more than one L1 or L2 chain, providing developers with more interoperability options.

Discover the Use Cases of L3 Blockchain Development

We'll discuss several present and future applications for Layer-3 blockchains below, such as:

Decentralized Exchanges (DEXs): To meet the demands of traders, DEXs, especially those that deal in more exotic products like futures and derivatives, often require rapid transaction times and minimal transaction fees. Since traders may like to complete hundreds or even thousands of transactions per second, this requirement, which Layer-3 chains can frequently meet, has only grown in favor as high-frequency and algorithmic trading have become more and more prominent.

GameFi: Axie Infinity particularly before its switch to the Ronin sidechain and Decentraland and other GameFi applications developed on top of Layer-1 (and even Layer-2) blockchains have experienced significant infrastructure problems, such as freezing, lagging, and lengthy transaction times. As a result, decentralized gaming has turned many potential gamers off, which has slowed the industry's growth. High scalability and infrastructure customization offered by Layer-3s enable more sophisticated graphics and faster gameplay, simplifying development and greatly enhancing the gaming experience.

Real-World Assets (RWAs): In many cases, L3s are the best option because of the slow transaction rates and higher GAS speeds of L1s and L2, which may have made it more challenging to trade and hold real-world assets like tokenized gold.

Blockchain Storage: Despite the development of alternatives like the Interplanetary File System (IFPS), L1 and L2 networks have had a significant issue storing large amounts of data on-chain. Due to their extraordinary flexibility, L3s may be the ideal option for safely keeping data on-chain in the future. They may also have enterprise uses, as blockchain data storage may help prevent increasing global data breaches.

Stablecoins: Because traditional remittance transfer services frequently charge high costs, stablecoins have helped provide digital banking services for unbanked persons and enable low-cost foreign remittances. Stablecoins also provide crucial liquidity to the global crypto market. In nations with substantial inflation rates, stablecoins like the Reserve have also been utilized as an inflation hedge. L3s may be the best option since, like the other applications discussed, L2s' high gas prices and slow transaction times diminish stablecoin-related services' efficacy, attractiveness, and efficiency.

The Specific Limitations of Arbitrum Orbit L3 Scaling Service on Ethereum

As we mentioned before, L3 blockchains have a lot of advantages, but they also have few drawbacks. Identifying validators for L3 chains can be difficult, especially when using specific L2 platforms. Furthermore, L3 chains inherit the security of L2 chains, which in turn inherit the security of L1 chains because they are usually constructed on top of L2 chains. Users and developers may experience security problems due to this comparatively lengthy "chain of security." Furthermore, although blockchain developers have considerable latitude about tokens, this latitude is frequently insufficient.

Conclusion

One intriguing development in the Bitcoin space is the creation of Layer 3s. Combining the most significant features of Layer 1 and Layer 2 enhances what we already had. For example, it makes the network more secure while still being scalable. Nevertheless, it is essential to remember that each layer contributes significantly to the blockchain ecosystem and does not compete with one another. Although Layer 3s is still in its early phases of development, it will significantly impact how we use blockchain technology in the future by facilitating even greater transaction volumes on blockchains.

• blockchain development
• blockchain developers