re.al is the first permissionless Layer 2 designed for tokenized Real World Assets (RWAs). Developed using Arbitrum Orbit, re.​al aims to be the new home for RWA DeFi, the primary destination for builders and investors alike.

The need for another L2

While general-purpose L2s like Arbitrum, Optimism, zkSync, and many others, help in scaling the Ethereum blockchain, they are not enough. Even though these platforms are capable of supporting a large user base, they force all the applications built on the same L2 to share the same blockspace competing with each other under limiting rules.

Developers have to spend more time figuring out the technical infrastructure rather than building great products for their users.

We believe in a multichain world, where there will be several L2 chains, each dedicated to a specific use case. In this vision, re.al aims to be go-to chain for Real World Assets as the first permissionless L2 tailored to RWAs. Applications building on re.al find an ecosystem catered to the growing category of RWAs. re.al addresses the critical issue of liquidity fragmentation—a prevalent challenge in today's DeFi landscape. Liquidity is split across many chains and applications, making it difficult to enable high capital efficiency and true DeFi composability.

Our goal is to simplify DeFi for RWAs, making it more accessible and user-friendly. Requiring investors to move across many blockchains, bridging through many L2, L3, and App Chains, is counterproductive.

re.al vision is to fully unlock the potential of tokenized Real World Assets. By bridging to re.al, investors can make the most out of RWA DeFi, with a wide range of financial protocols that caters to both conservative strategies, as well as degen and leverage opportunities.

On Optimistic Rollups and How They Scale Ethereum

Optimistic rollups are L2 protocols that increase the throughput of the Ethereum base layer by processing transactions off-chain. As computation on Ethereum is slow and expensive, Optimistic rollups are able to provide up to 10x-100x improvements in scalability. Specifically, Optimistic rollups bundle several off-chain transactions in a single batch before submitting to Ethereum. This process allows the splitting of gas costs for a single Ethereum transaction among all the transactions in a batch, reducing the gas burden on users.

While other scaling solutions like sidechains and plasma chains store the transaction data off-chain, Optimistic Rollups can inherit their security from Ethereum as they post the transaction data on-chain. The transaction results are posted to Ethereum Mainnet in the form of calldata. Among the many improvements introduced with EIP-4844, the calldata will have a reduction of gas prices (from 16 gas units per byte to 3 gas units per byte), which along with the other solutions introduced in the proposal, will reduce the gas costs on L2 by an additional 10x-100x.

Optimistic Rollups are said to be “optimistic” because they assume the off-chain transaction to be valid until proven otherwise. They rely on a fraud-proving mechanism that allows any validator to watch the chain and submit a fraud proof, during the allowed challenge period, in order to challenge the results of a rollup transaction. The challenge period lasts about 7 days, which means that until this time expires, the rollup transactions are not included in the final state on Ethereum. For this reason, when users want to withdraw their funds from an Optimistic Rollup to Ethereum Mainnet, they have to wait until the end of the 7 days challenge period for their withdrawal request to be finalized.

3rd party bridge solutions like Stargate or Across have developed protocols that allow to make the withdrawal almost instantaneous, if the selected route collects enough liquidity. While these providers can help to expedite the withdrawal process for users, they also introduce an additional risk layer as bridges have been an attractive and lucrative target for hackers.

Note that while Optimistic Rollups are intended to work as described before, they are still in development. As outlined in the L2BEAT Rollup Stage framework, Arbitrum is the only Optimistic Rollup that has completed the initial development of the interactive fraud proof system. re.al inherits the most advanced version of the Arbitrum Rollup on its Orbit chain, including the implementation of interactive fraud proofs. This currently represents a relatively safer option to Optimism and OP Stack chains; while the fraud proof system is under development, users need to trust block proposer to submit correct L1 state roots.

Why Arbitrum Orbit?

We carefully explored the available options to build the re.al L2 such as the OP Stack, Polygon CDK, and Arbitrum Orbit. We believe that deploying as an Orbit chain provides us the best blend of scalability, security and customization to make re.al the best chain for RWAs.

• Modularity: re.al is a true modular blockchain, allowing the integration of different technologies to optimally serve RWA needs, as they evolve. Building on Orbit gave us more flexibility as we were able to set up a custom gas token, a custom bridge to provide native yield on ETH and DAI, and using LayerZero for cross-chain messaging. We also had different alternatives for tackling data availability (more in this later), and we will be able to integrate or switch to new modules as they become available.

• High throughput and low gas fees: Transaction speed and TPS (Transaction Per Seconds) are highly enhanced compared to the Ethereum Mainnet. Thanks to a dedicated throughput, traffic congestion is alleviated and gas fees reduced.

• Security: re.al inherites its security from Ethereum, the same as Arbitrum One. While rollups introduce some more risk than deploying directly on Ethereum, Arbitrum has proven to have built one of the most secure and tested L2 technologies. Arbitrum is also the only Optimistic Rollup to have already implemented a fraud proof system.

• Arbitrum Nitro: Orbit chains are powered by the Nitro Stack, the same tech stack leveraged by Arbitrum One, which is the leading L2 by a distance. re.al will also receive all Nitro code upgrades and improvements.

• EVM+ compatibility: developers can build applications on re.al writing smart contracts in Solidity, and also in C, C++, and Rust, thanks to the forthcoming introduction of Arbitrum Stylus.

• Account abstraction: as gas fees become low and predictable, applications can also implement innovations like transaction fee subsidization to abstract technical complexities from the user experience, appealing to a new non-technical audience.

• Custom gas token (reETH): thanks to this Orbit feature, re.al introduces reETH as the native gas token of the chain. reETH brings native yield on re.al as it is a yield-bearing token, 100% backed by LSTs in the native bridge. When users bridge ETH to re.al, it gets staked through the bridge contract, giving reETH back, which accrues yield like any yield-bearing LST such as wstETH.

On top of all the technical reasons to use Arbitrum Orbit, we deeply believe in the Arbitrum ecosystem to be the perfect home for re.al. Arbitrum is the L2 with the most active DeFi landscape, and we aim to be part of its growing community that fosters more than 550 protocols deployed, amassing a total TVL of $14.5b.

Gelato RaaS

re.al is built through the Gelato Rollup-as-a-Service. Our collaboration with Gelato has been instrumental in accelerating re.al's development, significantly reducing complexity while leveraging a robust, plug-and-play infrastructure. This partnership has allowed us to swiftly implement, manage and customize various technical components, such as Oracles, Indexers, and Bridging, to ensure re.al’s position as a leading chain for RWAs.

Below is a breakdown of the infrastructure partners that power re.al.

Addressing Data Availability

The rise of rollups and the shift towards L2 and App Chains have brought the issue of data availability to the forefront. Data availability refers to ensuring that all transaction information on a blockchain is accessible to every network participant. As rollups consolidate multiple transactions into a single block for the Ethereum Mainnet, they must ensure the complete availability of transaction data.

Currently, a significant portion of the costs associated with L2 transactions stems from the need to store and transmit data to L1. To mitigate these costs, various data availability solutions have been developed, both on-chain and off-chain.

On one hand, the upcoming EIP-4844 aims to optimize data availability on the Ethereum chain, potentially reducing L2 gas fees by 10-100x. However, for blockchain technology to achieve mass adoption, off-chain data availability solutions are also necessary:

1. Data Availability Committees (DACs)
   DACs are a set of trusted nodes or entities that store data off-chain and make it available as requested. This way, during transaction processing, block producers and sequencers publish state transitions directly to DAC, which then attests to promise data availability. The limited size of these committees facilitates easy implementation, high scalability, and a secure environment, provided the DAC entities are trustworthy.

2. Data Availability Protocols
   Data Availability Protocols  operate as permissionless networks, offering off-chain storage solutions without depending on trusted third parties. These protocols employ various systems to ensure network integrity without the need for permissioned entities.
   
   For instance, Celestia relies on a Proof-of-stake validator system, while EigenDA derives its security from the ETH restaked to its AVS (Actively Validated Service) on the EigenLayer restaking platform.
   
   While data availability protocols provide similar scalability to DACs but in a more decentralized way, these protocols have yet to demonstrate their reliability, as many are still in development and not widely available.

re.al's Approach to Data Availability

re.al will initially use the Arbitrum DAC for data availability, with the intention to transition to a different solution in the future. Operating with the Arbitrum DAC enables re.al to process transactions and generate fraud proofs, with the DAC providing data availability attestations. This setup allows us to launch the chain with high scalability and low costs while we are conducting the correct due diligence on different data availability solutions.

While data availability protocols like Celestia and EigenDA could be a possible module to integrate, we are also considering rolling up directly to Ethereum once EIP-4844 is implemented. This would be the safest option and might still provide an optimal compromise of costs and scalability. We will carefully evaluate the benefits and risks of both solutions when Proto-Danksharding will be live, in order to provide the best mix of scalability and security to developers and users alike.