Minority Mindset

Smart investments

Crypto News

Injective, Underperforming in Crypto Markets, Now Plans Layer-3 Chain on Arbitrum

May 7, 2024

As a crypto investor who saw the meteoric rise and subsequent fall of Injective’s INJ token in 2023, I’m keeping a close eye on this new development with a mix of excitement and caution. The potential integration with Ethereum’s layer-2 project Arbitrum and the launch of Injective’s own layer-3 network could indeed inject fresh energy into the INJ token if it manages to outperform in the current bull market.

As a crypto investor, I’ve been following the intriguing developments of Injective, a Cosmos-based blockchain whose INJ token experienced an astounding 33-fold price increase in 2023. However, this year has seen a sharp decline for this project. Despite the setbacks, Injective is determined to bounce back and expand its horizons by launching its own layer-3 network within the Ethereum ecosystem. Leveraging the technology of the successful layer-2 project Arbitrum, Injective aims to provide even more efficient and scalable solutions for its users.

The injection of “inEVM” by Injective, a system that works harmoniously with the Ethereum Virtual Machine (EVM) and bridges the connections among Ethereum, Cosmos, and Solana networks, will leverage Arbitrum’s Orbit toolkit for its infrastructure. This empowers developers to create customizable chains utilizing Arbitrum’s technology while benefiting from the interoperability between various ecosystems.

As a successful crypto investor, I can share that last year, the INJ token showed exceptional performance in the digital asset market, surpassing almost all of its competitors. This impressive run saw the token’s market capitalization peak at over $4 billion. Now, with this potential development on the table, there’s a strong possibility that the INJ token could receive a much-needed boost, infusing newfound vigor and potentially driving even more growth.
In 2024, the overall crypto market has advanced significantly, as evidenced by the CoinDesk 20 index’s 25% growth year-to-date. However, from a trader’s perspective, INJ has experienced a notable decline, dropping approximately 30% thus far in the year.

Based on information from a press release obtained by CoinDesk, this integration for developers opens up fresh possibilities for creating projects within the Ethereum L2 (Layer 2) network, all while preserving Injective’s swift transaction speeds and affordable costs.

The teams mentioned that conducting transactions on the inEVM network will impact the token economics of Injective, specifically in relation to the $INJ token’s burning mechanism. This mechanism regularly incinerates a portion of all protocol fees every week.

As a researcher exploring the latest developments in blockchain technology, I’d like to highlight the importance of Injective’s integration with Arbitrum from my perspective. This collaboration goes beyond just constructing blockchain networks or infrastructure. Instead, it reinforces the fundamental concept of interoperability, bridging the divide between Ethereum, Cosmos, and other popular L1 (Layer 1) platforms. By achieving interoperability, we’re enabling a thriving ecosystem where cross-chain assets and liquidity can seamlessly interact across different networks.

Read More

2024-05-08 16:12