Arbitrum’s TVL grows to $ 1.5 billion as DeFi turns monkeys into ArbiNYAN

Ethereum Arbitrum One’s two-tier aggregation network is starting to see significant growth, with its Total Value Locked (TVL) increasing around 2,300% over the past week.

According to L2beat, an analytics platform that compares Layer 2 protocols, Arbitrum’s TVL hit an all-time high of $ 1.5 billion on Sept. 11 when DeFi Degens rushed to invest in DApps.

Off-Chain Labs brought Arbitrum to the mainnet on August 31, following a $ 120 million financing round. Since then, Ethereum’s transaction fees have risen to near record levels, boosting liquidity migration to Layer 2 expansion solutions and competitive solutions.

Arbitrum currently holds 65.7% of the total blocked capital in the second-layer network, followed by the decentralized second-layer exchange dYdX with 14.6%.

Much of Arbitrum’s growth is attributable to the ArbiNYAN profit farm, which attracts investors with thousands of percent returns on staking their native token.

The optimistic mood around ArbiNYAN seems to be short-lived, however, as its native token has lost more than 90% of its value in less than 12 hours. At the time of writing, NYAN is only trading at around $ 0.60 after falling to $ 0.45, with the price currently down 92% from its September 12 high of $ 7 0.85, according to Defined.

While the hype surrounding ArbiNYAN seems to have quickly gone up in smoke, the rapid transition in liquidity to Arbitrum has impacted the broader DeFi ecosystem.

An accomplished DeFi farmer Note that the sudden withdrawal of about 200,000 ethers ($ 660 million) from Curve’s stETH pool since the launch of ArbiNYAN has created an arbitrage opportunity due to slippage.

A significant part of the capital that flows into Arbitrum also seems to come from the so-called “Ethereum killer”.

Data from Dune Analytics, released to social media on September 12, shows that Arbitrum’s TVL increased by around 2,300%, but the TVL of the bridges with Solana, Fantom and Harmony decreased by 58%. 36% and 62% this week, respectively.

TVL bridge Arbitrum absorb TVL bridge Solana

Arbitrum (Ethereum Class 2) is Solana’s killer pic.twitter.com/SpP8bpOrR8

– James Spediacci (@JamesSpediacci) September 12, 2021

Related: Ethereum layers reportedly process more transactions than Bitcoin

It takes seven days to process funds withdrawn from Arbitrum back to the Ethereum mainnet.

All deposited ethers will remain with Arbitrum for a period of seven days until they are available for withdrawal. At the time of writing, DefiLama reports that ArbiNYAN is still on hold for $ 1.55 billion even though NYAN token price has plummeted.