Recent reports reveal that the Graph, a platform used for indexing and querying blockchain data, is in the final stages of migrating to Arbitrum, a popular Ethereum layer-2 protocol. Following this announcement, GRT, the native token of the indexer, is up 13% in four days, per the candlestick arrangement in the daily chart.

The decision to migrate to Arbitrum follows a vote after a proposal was floated to move the indexer to the layer-2 platform. 

The Graph Improvement Proposal received majority support from the community, necessitating the preparation for the eventual shift to Arbitrum, a layer-2 platform using roll-ups. Like any other off-chain solution, Arbitrum enables high transaction processing, increasing scalability.

With better transaction processing capability, transaction costs are lower, allowing high-demand protocols to launch while enjoying high-security levels since all transactions are rolled up and confirmed on the mainnet.

According to the development team, the goal is to enhance scalability, boost transaction processing speeds, and, most critically, reduce the costs of data indexing.

Tegan Kline, the CEO of one of The Graph’s development teams, Edge & Node, said the community chose Arbitrum due to its speed and affordability:

The Graph users have consistently sought solutions to improve gas efficiencies and other aspects of the network. After carefully evaluating available options, the ecosystem chose Arbitrum as the layer-2 scaling solution to provide speed and affordability to protocol developers and network participants.

Although Ethereum has changed its fee bidding model following the implementation of the EIP-1559, transaction costs are still high, discouraging some users and protocols from using the mainnet.

Moreover, as visible by the high network utilization rate, the high demand for the mainnet means users wishing to transact on layer-1 must pay much more to approve their transactions.

On Arbitrum, The Graph holders will also delegate GRT tokens more cheaply. Delegated tokens are staked with Indexers, who index and query data. 

Following this transition, Indexers stand to receive more GRT rewards since transacting on Arbitrum is relatively cheaper. According to L2 Fees, a fee tracker, every transfer on Arbitrum costs $0.08, multiples cheaper than Ethereum, which stands at $1.24. 

It is yet to be seen how The Graph will capitalize on “data accessibility,” which Steven Goldfeder, the CEO of Offchain Labs, said Arbitrum offers.

However, what’s clear is that The Graph provides a solution for users wishing to query blockchain data more efficiently. Public blockchains such as Ethereum or Bitcoin are designed to store data securely. However, they can make it challenging to retrieve this data reliably.

GRT is trading at $0.10, up 13% from this week’s lows when writing on June 14.

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