Crypto

Tornado Cash, an Ethereum Privacy Protocol Ready to Launch on L2 Arbitrum

Tornado Cash

Participants will be allowed to make private transactions utilizing the popular Tornado Cash mixer on the Arbitrum layer two network once it is finally operational.

Tornado Cash is poised to get a boost in terms of scaling, as the privacy protocol prepares to take on Ethereum’s layer two networks Arbitrum.

Tornado Cash’s smart contracts are currently live on the Arbitrum Layer 2 scaling network, many thanks to community efforts that have ensured the protocol’s reliability.

According to the November 29 statement, deploying on Arbitrum will “enable users to take advantage of all the gains a Layer 2 may offer, with the most significant comparative advantage being cheaper transactions.”

Tornado Cash is an Ethereum (ETH) completely decentralized mixer technology. Tornado Cash keeps the path that tokens like ETH take from sender to receiver, allowing transactions to be secret without the usage of privacy-focused coinage.

Layer two Ethereum networks offer faster transactions and lower fees while maintaining Ethereum’s security and decentralization.

The Tornado Cash team believes that moving to Arbitrum will enable more people to conduct private crypto transactions while avoiding the exorbitant gas prices linked with Ethereum. According to the team, L2 Ethereum transactions will be 95 percent cheaper than L1 Ethereum transactions.

Users will first move ETHEREUM, ERC-20, and ERC-721 tokens from Ethereum to Arbitrum via the Arbitrum Bridge to spend Tornado Cash on Arbitrum.

Arbitrum is the most valuable L2 on Ethereum, with $2.68 billion in total value locked, accounting for 39% of the L2 market. According to L2Beat, this is second to Boba Network’s $1.38 billion alone in TVL, making Boba and Arbitrum the only two L2’s with more than $1 billion in TVL.

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Since September this year, the number of unique addresses on Arbitrum has continuously increased, reaching 291,876 at the time of writing. According to DeFiPulse, Tornado Cash has $847 million in TVL.

Tornado Cash debuted its TORN governance token in December last year, 2020, and airdropped it to consumers in February this year, 2021.

What Is Tornado Cash?

Tornado Cash is a non-custodial, decentralized privacy solution that is based on Ethereum. By severing the on-chain link between the recipient and destination addresses, it improves transaction anonymity. Tornado Cash is based on a smart contract that takes deposits in ETH and ERC-20. Any on-chain address can withdraw these deposits.

What Is Arbitrum?

Ethereum is a well-known platform for creating decentralized applications (DApps). Although, due to a rapid increase in use in recent years, the network has been pushed to its maximum limits, causing transaction costs to skyrocket and chronic congestion.

While some believe that on-chain changes and improvements are the best approaches to increase Ethereum, others are opting for second-layer alternatives.

Though they differ greatly in terms of function and design, one of them, known as Arbitrum, has gained a lot of traction as a result of its creative approach to the problem.

The Author

Samuel Adeshina

Samuel is a financial reporter whose interests include blockchain, market, business, insurance, and Crypto to provide relevant information to all interested.