Arbitrum will receive one of its most significant upgrades on Wednesday, increasing transaction throughput, lowering transaction fees, and simplifying cross-chain communication between Arbitrum and Ethereum.
The platform reconfirmed the date of the "Nitro" upgrade in a Twitter post on Aug. 29, affirming that the upgrade will take full effect on Aug. 31 at 10:30 AM Eastern Time, with a two to four-hour network downtime expected.
Abritrum is a layer-2 scaling solution for Ethereum that uses Optimistic Rollup technology to off-chain bundle large batches of transactions from the platform’s smart contracts and decentralized applications prior to actually submitting them to Ethereum.
Nitro will be a "fully integrated, complete layer 2 optimistic roll-up system" that expands on Arbitrum One with new and improved fraud proofs, as well as updated sequencers, token bridges, and call data compression mechanisms, as per Off-chain Labs' GitHub account.
Offchain Labs is a blockchain-based company that was founded in 2018 that creates a suite of Ethereum scaling solutions.
Offchain Labs also released an update to its ArbOS (Arbitrum Operating System) component, which is now written in the Go programming language. The new version will enhance cross-chain communication between Arbitrum and Ethereum, as well as transaction grouping and data compression, reducing costs on the platform.
The document also mentioned that the state of Arbitrum One "will be migrated seamlessly" to Nitro, which, if properly executed, should rule out the probability of a chain split.
Offchain Labs stated in an April 2022 article that the Nitro upgrade would be "the most advanced Ethereum scaling stack" and that "Nitro will vastly increase network capacity while also lowering transaction costs," adding:
"Right now, we throttle Arbitrum's capacity, but with Nitro, we'll be able to loosen those reins and significantly increase our throughput." And, while it is already 90-95% less expensive than Ethereum on average, Nitro reduces our costs even more."
The platform has $936 million combined value locked (TVL) on the network, as per decentralized finance (DeFi) aggregator DeFi Llama, distributed across 111 different protocols, with GMX, Stargate, Curve, and Uniswap among the most widely known applications.