Injective, a blockchain platform originally built on Cosmos technology, experienced a meteoric rise in 2023 with the value of its INJ token rising 33 times, but then plummeted this year. In a strategic shift, Injective will now leverage Arbitrum’s technology to expand its reach by launching a layer 3 network within the Ethereum ecosystem.
The new layer, called “inEVM”, is designed to be compatible with the Ethereum Virtual Machine and aims to connect the three major blockchain networks: Ethereum, Cosmos, and Solana. inEVM leverages Arbitrum’s Orbit toolkit, allowing developers to create custom chains while ensuring interoperability across diverse ecosystems.
This expansion could potentially reignite interest in INJ tokens. INJ token surpassed most of its peers last year, achieving the highest market capitalization in excess of $4 billion. Despite the overall uptrend in the cryptocurrency market in 2024, the value of INJ has decreased by almost 30%, with the CoinDesk 20 index rising 25%.
According to Injective Labs, this initiative will not only foster development within the Ethereum layer-2 space, but also maintain Injective’s high-speed and low transaction cost characteristics. Additionally, operations on the inEVM network support the token economics of the Injective ecosystem through a mechanism for periodically depleting a portion of all protocol fees.
Eric Chen, co-founder of Injective Labs, emphasized in a press release that the integration with Arbitrum is pivotal in enhancing blockchain networks and infrastructure. He emphasized the importance of interoperability to bridge the gap between major layer 1 platforms, enabling more fluid exchange of assets and liquidity across different blockchain ecosystems.
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