Arbitrum Orbit Chain Users To Pay Gas Fees Using USDC: Why Is ARB Down 80%?
August 09 2024 - 12:00AM
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Users of Arbitrum orbit chains, layer-3 solutions for Ethereum
built on top of the platform’s technology stacks, can now pay gas
fees using USDC. The move comes even as ARB, the native token of
the Ethereum layer-2, continues to post lower lows, pushing losses
to nearly 80% since January 2024 highs. Arbitrum Orbit Chains
Support USDC For Paying Gas Fees In a press release, the decision
to integrate bridged USDC aims to reduce gas fees and attract more
developers. As of August 8, USDC is one of the top stablecoins by
market cap. CoinMarketCap data shows that Circle, the stablecoin
issuer, has minted over $34.5 billion of the token, mainly on
Ethereum and its layer-2s. Related Reading: 3 Reasons Why Ethereum
Is Struggling Today: Will ETH Break $2,000? It should be noted that
USDC is also supported in other ecosystems, including Solana and
the BNB Chain. Currently, over $1.6 billion USDC has been bridged
to Arbitrum. By allowing users to pay gas fees using USDC, Arbitrum
said they would be saved from the pain of enduring volatility
typical in ETH. Depending on demand, gas fees tend to fluctuate,
rising by several folds when there is congestion in the mainnet.
This volatility tends to impact user experience significantly. As
such, some users opt for alternative platforms like Solana or
Avalanche, where gas fees are relatively low. Since USDC is pegged
to the greenback, it is stable. Accordingly, regardless of the
decentralized app they use on Arbitrum’s orbit chains, users can
predict gas fees, making it easier to budget and, more importantly,
manage finances. Pushing Adoption, ARB Down 80% In 8 Months In the
press release, Arbitrum added that this integration will free orbit
chain users from holding multiple tokens, further enhancing user
experience. Related Reading: More Pain Ahead: Analyst Warns Of
Imminent Bitcoin Plunge Below $54,000 To Fill CME Gap Circle also
announced a grant program for projects looking to be built on
Arbitrum. This may spur the adoption of USDC on the orbit chain.
Despite the integration, ARB, the native token of Arbitrum, remains
under intense selling pressure. As of August 8, the downtrend
remains, and ARB is down nearly 80% from January 2024 highs. Even
though prices have been consolidating, as evident in the daily
chart, bulls need to push higher, clearing $0.60. However, a clean
break above 40.80, or July highs, could spark demand. This surge
may revive demand in the medium to long term. Feature image from
DALLE, chart from TradingView
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