Hi friends 👋

You have probably noticed that doing stuff on Ethereum can be very expensive at the moment...

And this is pricing out many people that don't understand why they should spend $$$ just to swap tokens.

Honestly, Uniswap is making Western Union look cheap at the moment.

Essentially this is happening because there are more and more people trying to use Ethereum, and as block space is limited transaction (gas) fees rise to balance supply and demand.

Ethereum can do around 30 transactions per second, well below what a centralised service such as Visa (7000 tps) can do or even some other, arguably more centralised blockchains such as Solana (65,000 tps), so it doesn't take too much for the system to get congested.

One way the Ethereum teams are tackling this problem is with Layer 2 chains, which are essentially blockchains that take some transactions away from the main chain, whilst trying to keep the security of the main chain.

There are a couple of reasons why you should care about this.

Firstly, these L2s should enable much lower fees, and secondly, there is a reasonable chance that they will do an airdrop at some point in the near future.

Retroactive airdrops for early users are quite common in the crypto industry. DYDX recently had an airdrop worth up to $100k for example.

This is one thing I love about this industry, in crypto it pays to be an adopter that it usually doesn't in web2. Think about the early users of Facebook, I am pretty sure that the Harvard students using Facebook didn't get any shares.

In crypto, you get shares (governance tokens)

Today, I am going to walk you through how you can get started with two of the most popular L2's, Arbitrum and Optimism.

Give it a try today and you might be in luck if they decide to roll out their own governance token later.

Let's get started.

To begin with, you should know that the process is almost identical for each of them. We're going to look at Arbitrum.

Step 1 - Head to the bridge:

https://bridge.arbitrum.io/

This is where you will 'bridge' your assets from the main Ethereum blockchain to the Arbitrum side chain.

You might worry that you have stepped back into the web circa 1999 with this design, but fear not, you are in the right place.

For some reason a lot of crypto looks like it was designed in the 90's....but I digress.

Step 2 - Connect your Metamask wallet

Now you are going to have to add the Arbitrum chain to your Metamask. Go to Settings → Networks → Add Network, and add the following info:

• Network Name: Arbitrum Mainnet

• New RPC URL: https://arb1.arbitrum.io/rpc

• Chain Id: 42161

• Currency Symbol: ETH

• Block Explorer URL: https://arbiscan.io/

You can then switch back and forth between Arbitrum and mainnet by clicking on the network name at the top of your wallet.

Step 3 - Transfer ETH to Arbitrum

You are now ready to send some ETH to Arbitrum. Add the amount you want to bridge over and click "deposit". You will need to approve the transaction in Metamask (which will cost tx fees as usual). In about 10 minutes you will see your ETH on Arbitrum. Remember you will need to switch the network to see it.

Congratulations, you now have ETH on Arbitrum!

There's not that much you can do at the moment on Arbitrum, as it is still very early, but both Balancer and Uniswap are available and you will get to enjoy significantly cheaper transactions if you make use of either of them.

If you want to head straight back, you just need to go to the bridge again and click 'withdraw' (note there is a 7 day withdrawal period!). But why not stick around and explore with those sweet low fees.

Whatever you do, hopefully this will help you qualify you for any future Arbitrum/Optimism airdrops.

If you do receive an airdrop after reading this article, let us know!

Thanks for reading

Jamie

⚠️ Health warnings

Both these projects are at an early stage. Things can still break. Please also note that when bridging back to the main ETH ecosystem you will have to wait 7 days for your funds to be released. You will also have to pay fees both ways, so you will get back slightly less ETH than you bridged.

Although Arbitrum is planning to become decentralized, at the moment the team has most of the control over the network. Arbitrum is well respected, so it is unlikely they will abuse that control, but it is still worth being aware that the risk exists.

Get involved with Arbitrum and Optimism:

👉 Arbitrum's website

👉 Optimism's website

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🚨 Disclaimer: This is not investment advice. Everything in this newsletter is for entertainment and education purposes only. Do your own research. Think for yourself. Any financial interest the Block Breakdown team has in any project mentioned will be clearly highlighted.