What Is Optimism (OP)?

Optimism executes transactions on its own network and writes the transaction data to Ethereum. The name optimistic comes from transactions being assumed valid by default: if an incorrect state update is published, anyone can challenge it by submitting a fault proof during a set challenge period. Because of this structure, direct withdrawals from Optimism to Ethereum are generally subject to a waiting period of about one week. Because the network is EVM-compatible, Ethereum applications can run here with small changes.

An important component of the project is the open-source OP Stack software framework. Many networks, most notably Base, developed by Coinbase, have been built with the OP Stack; the goal of connecting these networks through shared infrastructure and standards is called the Superchain. Governance is carried out through the Optimism Collective structure, which includes the Token House made up of OP holders and the Citizens' House; retroactive funding distribution (RetroPGF) to projects that provide public benefit is among the best-known practices of this structure.

The security of optimistic rollups depends on there being at least one honest participant who will challenge incorrect states. The centralized operation of the sequencer that orders transactions and the upgrade privileges over the contracts are risk factors often evaluated for Layer 2 networks.