Arbitrum DeFi vs Solana DeFi

Seamless Ethereum integration: Full EVM equivalence allows immediate deployment of Solidity/Vyper dApps (e.g., Uniswap, GMX). This matters for teams prioritizing security and existing tooling, leveraging Ethereum's battle-tested L1 consensus and audit ecosystem.

Optimistic Rollup economics: Transaction fees are ~90% cheaper than Ethereum Mainnet, ideal for complex DeFi operations (e.g., multi-step yield strategies on Aave, perpetual trades on GMX) where execution certainty is more critical than absolute speed.

Native high performance: 2k-10k TPS with 400ms block times enables high-frequency, low-latency applications like the Phoenix DEX or margin trading on Drift. This matters for building CEX-like user experiences in DeFi.

Single-state architecture: All programs run in a globally consistent state, enabling trustless atomic composability across the entire ecosystem (e.g., Jupiter swaps aggregating 100+ liquidity sources). This matters for creating complex, cross-protocol interactions without bridging risk.

Full EVM equivalence allows seamless deployment of Solidity contracts from Ethereum, with over $3B in TVL migrated from L1. This matters for teams prioritizing developer familiarity and security inheritance from Ethereum's battle-tested codebase and consensus. Protocols like GMX, Uniswap, and Aave leverage this for low-risk scaling.

Reliance on a single, permissioned sequencer creates a potential liveness risk and MEV centralization point, unlike Solana's decentralized validator set. While fees are low vs. Ethereum, they are higher and more variable than Solana's, often $0.10-$0.50 per complex swap. This matters for applications requiring ultra-low, predictable costs or maximal censorship resistance.

Native high throughput of 2,000-5,000 TPS with ~400ms block times enables sub-second finality. This matters for high-frequency trading (HFT), real-time gaming, and applications where user experience demands instant feedback. DEXs like Raydium and Mango Markets leverage this for CEX-like speed.

Network instability during peak demand has caused outages, posing a reliability risk for always-on DeFi. The Rust-based Sealevel VM requires developers to learn a new paradigm, creating a steeper onboarding curve vs. EVM chains. This matters for mission-critical financial applications and teams with deep Solidity expertise seeking a frictionless migration.

• Ethereum-native protocol expansion (e.g., Lido, Curve).
• Security-first DeFi where Ethereum's trust assumptions are paramount.
• Teams with existing Solidity/IPFS tooling (Hardhat, Foundry, The Graph).
• **Applications valuing cost-optimization over ultra-speed.

• Latency-sensitive applications like on-chain order books (Phoenix) or HFT.
• Mobile-first or consumer dApps where sub-second UX is critical.
• Novel, high-throughput primitives not possible on EVM (e.g., state compression for NFTs).
• **Projects willing to accept new VM risk for maximum scalability.

Specific advantage: 2,000-5,000 TPS with sub-$0.001 transaction fees. This matters for high-frequency trading (e.g., Jupiter DEX aggregator) and micro-transactions where cost predictability is critical.

Specific risk: Historical network congestion and outages disrupt atomic composability. This matters for complex, multi-protocol strategies (e.g., lending-borrowing loops) that require 100% uptime guarantees.

Specific advantage: Inherits Ethereum's security with full EVM/Solidity compatibility and a $18B+ DeFi TVL ecosystem (GMX, Camelot). This matters for protocols migrating from Ethereum Mainnet seeking lower fees without rewriting code.

Specific limitation: ~40-100k TPS theoretical limit with fees 10-100x higher than Solana. This matters for mass-market consumer dApps (e.g., GameFi, Social) where sub-cent fees and instant finality are non-negotiable.