Optimism (OP) recently unveiled its highly anticipated Bedrock update, ushering in a wave of transformative changes to the network. Throughout the update process, OP temporarily suspended deposits and withdrawals, but once the rollout concluded, normal transaction operations resumed.
The Bedrock update signifies the official release of the OP Stack, introducing a collection of free and open-source modular components that synergistically power Optimism. By leveraging Ethereum as a data availability layer and implementing advanced batch compression techniques, Bedrock significantly enhances its predecessor, effectively reducing transaction fees.
With the successful release of the update, let’s delve into some key improvements it brings to the table. First and foremost, Bedrock slashes fees on the network, eliminating all gas costs associated with EVM execution when submitting data to L1. Moreover, it incorporates L1 re-organization functionality into the node software, dramatically minimizing deposit waiting time—a boon for users.
The Bedrock update doesn’t stop there; it also bolsters node performance, further augmenting the overall user experience. Considering these positive changes, the update’s impact on Optimism is poised to be intriguing. Token Terminal’s data indicates that Optimism has recently experienced a plateau in daily and weekly active users. However, introducing reduced fees could entice new users, injecting a dose of volatility into user metrics.
According to Dune’s data, transaction volume on Optimism has exhibited a consistent upward trend since May, and with the Bedrock update in effect, this momentum is expected to accelerate further. Surprisingly, the update’s release did not yield the price reaction anticipated by many. CoinMarketCap reveals that OP’s price depreciated by over 2% within 24 hours.
Despite the price decline, OP’s trading volume observed a notable increase, which raised concerns among some market participants. At the time of writing, OP was valued at $1.39, boasting a substantial market capitalization exceeding $894 million.
One plausible explanation for this decline could be OP’s recent token unlock, which occurred a few days ago. Token unlocks often lead to an influx of circulating supply and consequent price drops. Another token unlock is scheduled for June 30, 2023.
Fortunately, the Bedrock update has sustained OP’s development activity at a high level. The project’s popularity, as evidenced by social volume, has also remained relatively strong. Notably, OP’s weighted sentiment has turned positive, instilling a sense of optimism.
However, it is worth noting that whale interest in OP has dwindled, reflected in the low number of whale transactions. Additionally, OP’s network growth has experienced a significant decline in recent times, casting a shadow over its overall performance.