Decentralized Finance with Artificial Intelligence (DeFAI) is revolutionizing blockchain technology, and Arbitrum is at the forefront of this transformation. In 2024, the platform achieved a remarkable milestone by expanding to 70 chains while maintaining a substantial $20 billion total value locked (TVL).
DeFAI represents an emerging intersection of blockchain technology, decentralized finance, and artificial intelligence. This approach seeks to improve financial services by leveraging AI capabilities within decentralized networks.
The DeFi landscape has been experiencing significant transformation. In 2024, DeFi saw a robust recovery, with total value locked (TVL) surging by 119.7% year-to-date, reaching approximately $91.639 billion.
The rise has been characterized by the emergence of on-chain financial primitives and a narrowing gap between the DeFi and centralized exchange experiences. This gap increases adoption by both consumers and institutions, leading to heightened protocol competition. Some examples of DeFAI projects include Hey Anon and Singularity Finance.
Arbitrum’s Expansion to 70 Chains
Strategic partnerships with major decentralized applications like Uniswap, GMX, and Radiant underpin Arbitrum’s expansion. Its expansion to 70 chains marks a pivotal moment for Arbitrum. This indicates a massive scaling effort in the Layer 2 ecosystem.
In 2024, Layer 2 solutions saw significant growth. Arbitrum One captured $15.82 billion total value locked, followed by Base with $13.17 billion. This indicates that Arbitrum is the most successful Ethereum L2, with a heightened focus on DeFi and minimal memecoin activities.
Moreover, the platform can process approximately 40,000 transactions per second, dramatically improving Ethereum’s current 15-20 TPS capacity. Apart from these, it was the first L2 to have two virtual machines (VMs) via Stylus – Ethereum Virtual Machine and WebAssembly.
Arbitrum also offers several benefits. These include reduced network congestion, lower transaction costs, seamless Ethereum ecosystem integration, and enhanced transaction efficiency. In a recent development, AiSweat.Shop discreetly airdropped 700 million $DEFAI tokens to Arbitrum’s DeFAI ecosystem, representing 70% of its token allocation.
If we experience stability in the market structure, Arbitrum could achieve over $25 billion in TVL by Q2 with significant growth in protocol revenue streams.
As DeFi continues to grow, the merger of artificial intelligence with decentralized finance promises to unlock new potential in financial technology. The expansion of Arbitrum to 70 chains is a testament to the growing sophistication of blockchain ecosystems.
READ MORE: Metaplanet Makes Historic $747 Million Bet on Bitcoin’s Future in Largest Asian Equity Market Deal
