🌚Why Arbitrum

A discussion of Shell's first L2 home

Shell v3 now has deployments on several chains and L2s besides Arbitrum. This article dates from the launch on Arbitrum.

Shell v3 was initially deployed on Arbitrum One, an Ethereum rollup. Long before the protocol launch, the Government Toucans were launched on Arbitrum, and Shell had undergone a successful trial period with the testnet on Arbitrum Rinkeby. In other words, this was a careful and long-considered decision.

Why not deploy on Ethereum mainnet? Well, a lot has changed since Shell v1 was first deployed there. Layer 2s (L2s) have matured significantly as a sector, and rising usage of Ethereum mainnet has pushed gas fees consistently upward over time, the current bear market notwithstanding.

Why an L2 over a sidechain? Two reasons. First, Ethereum is the most mature from a security standpoint. There is no substitute for longevity when it comes to assessing security risk. Second, Ethereum is where nearly two-thirds of the assets in web3 are located at the time of writing. Therefore, other L1s have to bridge assets from Ethereum to their chain. Even if these sidechains are secure, oftentimes their Ethereum bridges are not. As of writing, over $1 billion has been stolen from bridges already.

L2s solve both problems. Because they are built directly on top of Ethereum’s L1, they inherit Ethereum’s security. Furthermore, bridging between an L1 and an L2 is far more reliable than bridging between Ethereum and a sidechain.

From another perspective, it makes sense to combine Shell and Arbitrum’s gas-saving effects to deliver as much efficiency as possible. Our goal with Shell Protocol is to connect web3 projects in one large network, making it simpler and more affordable to batch complex transactions. It makes sense to combine Shell’s composability with Arbitrum’s gas savings. Not to mention, Arbitrum has extremely low latency, giving our desktop app a smooth user experience. This in turn increases our attractiveness to users and builders, helping bootstrap the development of the Shell ecosystem.

We see Ethereum, Arbitrum, and Shell together as an ideal ‘dev stack’ for the smart contract deployments of the future. With Ethereum’s security, Arbitrum’s cost efficiency, and Shell’s networked composability, our builders are ideally positioned to rise to the top of the next wave of DeFi.

The ideal dev stack

Now, why Arbitrum in particular? If we’re looking for a rollup on which to deploy Shell, the leading options are either optimistic or zero-knowledge proof rollups. While both systems have merit, optimistic rollups appear as the more developed and mature of the two. At this point, the field grows slim, and Arbitrum is certainly a sector leader in the field of optimistic rollups for Ethereum.

The Shell team was initially drawn to the Arbitrum project because of its longevity, development ethos, and unique approach to multi-round fraud proofs. But the team behind Arbitrum is also a group of people committed to nurturing a diverse ecosystem of bold, independent developers. In short, it's an excellent home for Shell Protocol.