Binance appears to have begun making direct withdrawals to Layer 2 Ethereum Networks.
Lark Davis, a well-known crypto analyst, was the first to notice the change, posting a screenshot to his Twitter account.
Oh boy…… Binance just enabled direct withdrawals to layer two #ethereum!!!! HUGE NEWS!!!! pic.twitter.com/4B2t2nV9OB— Lark Davis (@TheCryptoLark) January 14, 2022
Binance has already announced the integration of the Arbitrum One network and the simultaneous availability of deposits for ETH on Arbitrum One Layer 2 in November 2021.
Users may now deposit both BTC and ETH to their Binance accounts utilizing the Arbitrum One Layer 2 solution, thanks to the newest update. The need for Layer 2 solutions has surged as Ethereum costs have skyrocketed.
As a result, Binance’s growth occurs at just the correct time! More individuals will be able to utilize Ethereum Layer 2 solutions like Arbitrum One without having to use the Ethereum mainnet as a result of this advancement. Previously, customers had to connect to a separate network and then bridge to Arbitrum, which was time-consuming and costly, according to the trader.
Arbitrum One Network
Arbitrum One is a beta mainnet for Off-chain Labs’ rollup solution. These rollups are critical for increasing Ethereum’s throughput. They can function by conducting transactions outside of the Ethereum mainnet while storing data on it at the same time.
The Arbitrum One blockchain makes use of optimistic rollups, which reduce network congestion and gas costs while enhancing performance.
Binance is one of the few cryptocurrency exchanges that accept Layer 2 Ethereum deposits and withdrawals. While traditional exchanges have been slow to adopt Ethereum Layer 2s, decentralized exchanges like as Uniswap, Aave, and 1inch have already done so.
As previously stated, the increased gas charge on Ethereum is driving up demand for Ethereum Layer 2s. As a result, we anticipate more centralized exchanges, such as Coinbase, to get on board and support and integrate L2s.