Ethereum Layer 2 scaling solution Optimism is rethinking its strategy after years of helping other projects build networks based on its technology. Now the company’s CEO Jing Wang says this approach came at a high cost.
Optimism was designed to offer cheaper transactions, just as Ethereum faced rising gas rates around 2020-2021. The OP Stack software has been used to launch chains like Coinbase’s Base and Kraken’s Ink, allowing them to build their own blockchains while remaining compatible with Ethereum.
But in a Nov. 27 She said the company has “been bathing in tactics” with partner chains for a long time, “without building the working machines to continue that momentum in a market that is dramatically different today.”
Although Optimism reduced costs by cutting staff and bringing all teams under one group, competition from Solana, Stripe-backed Tempo and other networks is becoming increasingly fierce, Wang said.
Wang then teased a change in focus. Rather than just helping launch new chains, Optimism will give companies more control over their networks, though she didn’t say exactly how.
“Ultimately, corporations want to control their own economies. They will not be sharecroppers on Stripe’s blockchain,” the Optimism CEO wrote.
Optimism did not immediately respond to The Defiant’s request for comment.
Declining statistics in the chain
Wang’s comments come as key measures of optimism continue to weaken. According to data from DefiLlama, the total value of the network has fallen to 2022 levels.
The monthly turnover of OP Mainnet versus TVL. Source: DefiLlama
Monthly on-chain revenue fell from about $2.3 million in March 2024 to about $373,000 in October, likely because transaction fees fell by about 90% after Optimism’s Ecotone upgrade in Q1 2024.
The network’s OP token is also struggling. At the time of writing, OP is down more than 85% in the past year and down more than 90% from its all-time high, according to data from The Defiant’s pricing page.