Key Takeaways FTX has added support for the Ethereum Layer 2 solution Arbitrum. The exchange allows users to make direct deposits to Ethereum’s Layer 2 without having to bridge assets from the mainnet. While Binance and FTX have expressed interest in supporting Layer 2, crypto enthusiasts have criticized Coinbase for showing more interest in pet coins. Share this article FTX has announced support for Arbitrum withdrawals and deposits. Meanwhile, Coinbase has been criticized for focusing on small-cap coin listings rather than Layer 2 integration. FTX launches Arbitrum support Another exchange has added support for Arbitrum. FTX, the third largest crypto exchange by volume, announced onboarding support for Arbitrum Tuesday, following Binance’s lead to adopt Layer 2 Ethereum. FTX users now have the option to withdraw ETH purchased on the exchange directly into their Arbitrum mainnet wallets. Previously, users had to send money to the Ethereum mainnet before moving to Arbitrum, a process that forces users to pay for Ethereum’s high gas costs. Likewise, FTX users looking to send ETH back to the exchange from Arbitrum can now deposit funds directly into their FTX exchange wallets. Arbitrum is an Ethereum Layer 2 network that uses Optimistic Rollups. The network benefits from the security of the Ethereum mainnet while reducing gas costs by bundling and posting transactions in the base chain call data. For complex transactions such as exchanging ERC-20 tokens, Arbitrum can currently reduce gas costs by a factor of up to 10. According to data from L2Beat, Arbitrum currently has about $3.4 billion in total value locked in, and many of Ethereum mainnet’s most popular DeFi protocols have built on it to make the jump to Layer 2. While the costs of using Arbitrum are only a fraction of those of processing transactions on Ethereum, the high gas costs associated with bridging funds on the network have been a barrier to adoption. As centralized exchanges like FTX and Binance build easier and cheaper onboarding for Arbitrum, it is likely that more users will be incentivized to use the network. While Binance and FTX have moved quickly to add Ethereum Layer 2 support, not all exchanges are following suit. Coinbase, the largest US exchange, has lagged its competitors in adopting Layer 2 in recent months. Prominent members of the crypto community have criticized Coinbase for offering illiquid, small-cap tokens instead of working. to native recordings for assets such as Fantom and Arbitrum onboarding. Commenting on Coinbase’s latest listing of the pet digital identity token Pawtocol, The Daily Gwei founder Anthony Sassano tweeted his disappointment at the exchange, stating, “I love Coinbase, but their priorities aren’t designed for this.” Sassano was joined in the comments by followers expressing similar views, stating that Coinbase first announced it planned to launch support for Arbitrum more than five months earlier, but hasn’t updated customers since. Coinbase has also been slow to unveil its NFT marketplace; Coinbase NFT is set to go live with support for Ethereum NFTs before the end of 2021, but has yet to launch. As Ethereum scaling solutions like Arbitrum gain traction, exchanges that don’t support onboarding for their customers risk being left behind. On the back of FTX’s Arbitrum announcement, many are already calling for other Layer 2 solutions like Optimism to gain support next, highlighting the public demand for Ethereum Layer 2 onboarding. 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