Ethereum Scaler Arbitrum Suffers Outage—Are Inscriptions to Blame?

Ethereum scaling network Arbitrum reported a “partial outage” Friday, bringing activity on the Arbitrum One blockchain to a standstill for the first time since June.

Offchain Labs, the company that developed Arbitrum, announced that the network stalled at 10:29 am EST Friday due to “a significant surge in network traffic.” The company says it is currently investigating the issue, which remained unresolved for well over an hour.

A spokesperson for Offchain Labs declined to comment on the cause of the outage, beyond the company’s initial statement.

On Twitter, numerous Arbitrum users and Arbitrum-based services reported a complete inability to process transactions on the network since the outage began.

Arbiscan, a blockchain explorer for Arbitrum, initially attributed the network’s failure to a “surge in activities due to inscriptions,” according to multiple Twitter users. It has since adjusted language on its website to match Arbitrum’s official statement, deleting the reference to inscriptions.

Inscriptions, first popularized by the massive success of Bitcoin Ordinals earlier this year, are detailed images or other pieces of media that are carved into denominations of cryptocurrency. While incredibly costly and a major lift for blockchains to process, inscriptions made a fair deal of sense for the Bitcoin network, which due to its lack of smart contract capabilities has never been able to support NFTs.

But recently, some users have begun embarking on the incredibly energy-intensive project of creating inscriptions on networks that already support NFTs. Last week, inscriptions on the Polygon, BNB Chain, and Avalanche blockchains accounted for a whopping 57% of traffic across the three major networks, according to the pseudonymous blockchain analyst Hildobby.

In the last week, inscription transactions have accounted for 30% of all traffic on Arbitrum One specifically, according to data from Dune Analytics.

Numerous Twitter users expressed their frustration at the possibility that inscription-related traffic brought down Arbitrum, as they feel the innovation is both unduly costly and fails to serve a practical function.

As of writing, Arbitrum appears to have restored some functionality, and Arbiscan is again recording real-time transactions on the network. Offchain Labs updated the network’s status from “partial outage” to “experiencing partially degraded performance” on the Arbitrum website, and the company said it “is aware of the technical issue” that is now causing high transaction fees on the network.

It has yet to publicly identify that issue though, or what initially caused Arbitrum to go down in the first place.