Optimism (OΞ) is a Layer 2 network that offers 10x cheaper gas fees compared to Layer 1, unless the L2 network is congested. Read on to learn more.
Uniswap Transaction Network Fees
When you submit a Uniswap transaction on Optimism (OΞ), your wallet will send an L2 transaction to the OΞ sequencer.
This sequencer will execute your transaction along with many others and then post the aggregate result (the "rollup") to L1. The sequencer will charge you a single, small gas fee that covers two costs:
- The L2 sequencer uses a portion of your gas fee to pay for the L1 rollup transaction. Whereas on L1 you would pay for the whole L1 transaction yourself, on L2 you pay for just a fraction of the L1 transaction because the cost is split across the other transactions in the rollup.
- The L2 sequencer keeps the remaining portion of your network fee as payment for the work it performed to execute and order your transaction
When you swap or provide liquidity you will pay a single, small gas fee to the OΞ sequencer.
If the OΞ network is not congested, then you can expect a Uniswap swap transaction to be 10x cheaper on L2 compared to L1.
However, if congestion occurs then gas fees on OΞ will increase commensurate with demand according to a strategy similar to EIP-1559. You can read more about this from the Optimism team here.
For that reason, it's important that you review the network fee before every transaction -- even on Layer 2!
Deposit Network Fees
Before you can enjoy the low fees of L2 transactions, you must first execute an L1 transaction to deposit your assets to the L2 bridge. The gas fee will be similar to other L1 transactions.
Withdraw Network Fees
To withdraw your funds back to L1, you will need to execute two transactions. First, an L2 transaction to trigger the withdrawal. This will initiate the fraud proof period and after 7 days you'll be able to claim your funds on L1.
At that point, you will need to submit a second transaction (this time on L1) to claim your funds and transfer them to your L1 wallet. This transaction costs approximately 500k gas.