Optimism (OP): What Is It? Definition & Explanation

Optimism is a Layer 2 protocol founded in 2019 by Jinglan Wang, Ben Jones, and Evan Shapiro, pursuing a solution to Ethereum's scaling problem through an optimistic rollup approach. Reaching a wide community with its May 2022 token airdrop, the project has made a fundamental contribution to the Ethereum ecosystem through its open-source OP Stack framework.

How Does an Optimistic Rollup Work?

An optimistic rollup sends transaction data to Ethereum while assuming all transactions are valid by default — hence the name "optimistic." If a transaction is disputed, a 7-day challenge window opens; if proof is provided, the transaction is reversed.

The advantage of this approach is achieving high speed and low fees without the computational cost of ZK proofs. The downside is a 7-day waiting period for withdrawals (bridges can shorten this).

OP Stack and Superchain

Optimism's most transformative contribution is making the OP Stack modular rollup infrastructure available as open source. Chains using this framework:

In the second half of 2025, Superchain processed 12.7% of global crypto transactions (3.60 billion transactions). A portion of Superchain revenue flows to the OP Collective: Base contributes 15% of its revenue to this pool.

Superchain structure — economic and technical connection between OP Stack chains and the OP Collective

OP Token and Governance

Optimism's governance system is two-tiered:

• Token House: The body of OP holders making decisions on protocol parameters and treasury
• Citizens' House: The body of SBT (soulbound token) holders managing Retroactive Public Goods Funding (RetroPGF) distribution

Tokenomics: Total supply 4.29 billion OP. Annual 2% inflation. Pilot program starting February 2025 (12 months): 50% of net sequencer revenue directed to OP buybacks.

Risks and Considerations

• Base growth paradox: As Base (using OP Stack) grows, users may stay on Base rather than OP; revenue flowing to the OP Collective is independent of this growth.
• 2% annual inflation: Net emission pressure continues despite the buyback program.

COINOTAG Perspective

With its Superchain vision, Optimism has become one of the most influential architects of the Ethereum scaling ecosystem. The adoption of OP Stack by major players like Base, Sony Soneium, and Unichain demonstrates the strength of its network effect. The February 2025 buyback program gave OP its first real value capture mechanism. The decisive question for long-term valuation: how much value flows from Superchain growth into the OP token economy?