Arbitrum’s Orbit Platform Adds Support for Custom Gas Tokens

TL;DR

• Arbitrum’s Orbit platform now supports custom gas tokens.

• This will enable  Orbit’s Layer 3 chains to create utility for their own tokens.

Orbit Now Allows L3 Chains to Create Utility for their Tokens

Arbitrum Orbit, a platform that enables developers to build Layer 3 blockchains on top of the Ethereum Layer 2 network Arbitrum, has included support for custom gas tokens. Gas tokens are tokens used to pay for blockchain transaction fees.

Thanks to this latest development, Orbit blockchains can use select ERC-20 tokens for transaction fees on their networks. According to Arbitrum, this was not possible in the past as Orbit chains were previously restricted to using Ether (ETH) as the gas token. 

Furthermore, this latest development allows Orbit chains to create utility for their own tokens and grow their ecosystem. While speaking to The Block, David Dennis, product marketing lead at Offchain Labs, the main developer of Arbitrum, said,

"For example, a game might want to have an in-game economic model but may still wish to build on top of Arbitrum and Ethereum underneath the hood."

Orbit’s new feature already has blockchains lined up to use it. Xai Gaming will take advantage of the custom gas tokens feature to make it easier for its users to pay transaction fees. Xai developed its Orbit chain in June 2023 and is known for hosting the web3 game publisher Ex Populus's games.

Soban "Soby" Saqib, co-founder of Ex Populus also stated that,

"By having a custom gas token, the Xai protocol can pay for gas on behalf of users with the gas subsidy contract. This greatly reduces friction for the end user. We strongly believe that web3 gaming hasn't caught on because of the friction for traditional users. Furthermore, we incentivize sentry nodes to secure the network with the XAI token. This allows us to solve the 'verifiers dilemma' that occurs in distributed systems. All of the above is enabled by Orbit's custom gas tokens." 

Arbitrum added that Caldera and Celestia are the other blockchain projects that are looking to immediately take advantage of its custom gas tokens feature. 

Abritrum Orbit has been around since 2023 and continues to attract more developers to the ecosystem. Orbit chains can be built on top of the Arbitrum One and Arbitrum Nova — the two Layer 2 networks of Arbitrum. However, the custom gas tokens feature is currently supported on Orbit AnyTrust chains, the Abritrum team added.  

Arbitrum One is currently the largest Ethereum L2 network and has a total value locked of over $2.5 billion.