Is Optimism Dying? A Long-Time Supporter’s Concerns

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I have been a fan of Optimism for a long time, but I feel compelled to raise some concerns that I believe many in the community silently share. These concerns are not coming from a place of hostility, but from genuine disappointment and fear that Optimism may be drifting away from being a sustainable ecosystem.

1. Lack of Real Utility for the OP Token

The OP token was supposed to be the backbone of the Optimism ecosystem. However, as things stand:

  • There is no compelling reason to buy and hold OP.

  • The distribution model has largely consisted of grants and incentives that recipients quickly sell, putting constant downward pressure on the price.

  • Even the projects receiving OP grants do not see a reason to retain exposure—they dump it as soon as possible.

  • Community members are left asking: why would anyone voluntarily buy OP when insiders, grantees, and even the team are selling?

This dynamic creates the perception that OP is not a value-accruing asset but merely a governance token with no sustainable demand drivers.

2. A Token Economy That Destroys Itself

Instead of designing mechanisms that give OP long-term utility (staking, fee sharing, or real yield tied to network activity), the current model seems to rely on endless emissions. The result:

  • More supply enters the market,

  • The price weakens,

  • Confidence erodes,

  • And fewer people want to engage with the token economy at all.

This is a vicious cycle that risks killing the very foundation on which Optimism’s ecosystem is supposed to grow.

3. The State of the Mainnet and the Superchain

The vision of the Superchain is bold, but in practice it appears fragile:

  • Running an L2 must ultimately be profitable, or it will not survive. At present, the Superchain does not appear economically sustainable.

  • OP Mainnet feels increasingly inactive compared to competitors like Arbitrum, Base, or zkSync, where user and developer momentum is stronger.

  • Without strong token economics, the Superchain narrative risks being seen as a branding exercise rather than a viable business model.

If the mainnet cannot attract sticky users and sustainable revenues, then scaling the “Superchain” only multiplies the problem across multiple chains rather than solving it.

4. Misaligned Incentives

One of the biggest red flags is that incentives are not aligned between the ecosystem and OP holders:

  • Projects receiving grants are incentivized to sell.

  • Users receive short-term rewards with no reason to stay once emissions dry up.

  • Even core contributors appear to be exiting positions rather than doubling down.

Contrast this with Ethereum, where ETH has clear demand drivers (staking, security, gas fees). Optimism has yet to provide anything close for OP.

5. The Bigger Picture

If Optimism continues on this path, it risks becoming:

  • A chain funded by temporary grants,

  • A community that slowly loses faith,

  • A token that has no reason to exist other than speculation,

  • And ultimately, a mainnet that fades into irrelevance while competitors thrive.

This is not the future that long-time believers (myself included) envisioned.

A Call for Change

If Optimism is to survive and thrive, it must:

  1. Introduce real utility for OP—something beyond governance. Whether through staking mechanisms, fee sharing, or integration into core economic activity of the network.

  2. Rethink the grant and distribution model—endless emissions only destroy long-term value.

  3. Ensure the Superchain is profitable—not just conceptually attractive but operationally and financially sustainable.

  4. Align incentives—make sure projects and contributors have skin in the game rather than an exit button.

I’m raising these concerns because I still care about Optimism. But if nothing changes, many of us may conclude that Optimism is indeed dying—not because the tech failed, but because the token economics were fatally flawed from the start.

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The hard part is that staking creates emissions, which also generate selling pressure. The fees aren’t significant enough to share either.

I think Superchain participants may need to hold some amount of OP after their first time in order to continue receiving benefits.

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You’ve stated the challenge. Now let’s begin the solution. I believe in Optimism. I have been working on a pilot for a stable-coin concept. It just needs community and guidance. Would a grant be nice? Absolutely! However, my grit won’t allow me to wait. I work full time in NetOps. I sacrifice because I believe in what I’m creating will have crucial value to people. Base is very focused on onboarding, gaming, 402x protocol and prediction markets – I think it’s great to be in proximity of an ecosystem with that type of energy. I’m new to the collective but I’m willing to listen and gain insight. I want OP to be home.

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Great analisys and contribution. I also believe and love Optimism and use it daily. I know not everyone is like me. Let’s cook toghether to keep the Optmism relevance!

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Hi,

Your remarkable post inspired me to write some thoughts on X, which I share here: https://x.com/ijaack94/status/1966171642981400991?s=61

I believe the only big change that OP can do to increase the buy pressure of the governance token is to commit to buyback tokens with the ETH they get from Superchain revenue-sharing.

Not 100% of them, of course, but a good chunk of them, like the same 15% they charge OP Chains in the Superchain.

This would give OP token holders the certainty that there will always be a buying pressure, and that this will increase with the amount of chains and throughput on the Superchain.

It’s the best alignment possible for me, even if it’s low for now. But it would still be a few tens of thousands of dollars bought on the open market every day, which can likely create a flywheel for users to buy OP more frequently, which will in turn drive more revenue to chains that will contribute more ETH to Optimism to buy back more OP.

Furthermore, Superchain contribution can be extended to dapps as well, with Superchain dapps paying a smaller percentage of ETH in contributions since they drive cross-chain activity that will be used to buy back more OP every block or every day for example.

Or simply drive those contributions back to OP token holders via staking fees, but that would be tricky since maybe Optimism wants OP to be a pure governance utility token..

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Well said - Optimism seems to be losing momentum as it has some powerful competitors such as Base backed by Coinbase, Linea backed by Consensys and SBET, Arbitrum with its high TVL.. Burn mechanism might be intrıduced like Linea in order to support the token - and incentives the optimism use with quests like Somnia is doing at the moment - and instead of airdropping tokens at once, locked them depending on quest performance.

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this is really a great analysis, and it’s something that genuinely worries me :). Recently I also saw another viewpoint like this https://x.com/realitywarp/status/1939710458044293132

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Question: Is Base, which is a member of the Superchain, being treated as a competitor because the discussion is proceeding on the assumption that Base may leave the Superchain in the future?

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I don’t understand what you mean - they’re not considered a competitor, but I don’t really know if they’re really driving positive progress for the whole Superchain.

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Optimism has behaved like a mother who spoils her children—giving them everything they ask for to help them grow, without expecting anything in return. It has continuously provided resources, support, and incentives to networks joining the Superchain, yet it remains unclear whether there is any binding legal agreement or clear regulatory framework behind these relationships.

The Superchain has often been treated as a public good without a profit motive: it has nourished all the chains, but has not received sufficient value in return.

As a result, the OP token now appears to be carrying a one-sided burden, unable to establish a sustainable flow of value. The core concern is this: if this imbalance continues and Superchain members do not feed value back into the system, the OP token could face serious long-term risks

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I share the same view on the importance of guaranteeing the OP token’s value over the long term. I should emphasize that Superchain members currently contribute to Optimism through revenue sharing. Whether the revenue-share ratio is insufficient, the fee-mechanism parameters are off, or the treasury should be put to better use, a careful discussion is necessary in any case, and, if the community wants it, we should accelerate that discussion.

Aside from using buybacks to support OP’s value, for example, we could use OP/ETH options as grant rewards (instead of granting OP tokens). If OP underperforms relative to ETH, grant recipients could burn the option token and the deposited OP to receive ETH. This would guarantee their living expenses and create continued incentives to contribute to Optimism. I prefer options to a simple buyback. (This is just one example. My point is that ways to back OP’s value and to motivate long-term contributions should be discussed, examined from multiple angles, and organized.)

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Thank you for raising these critically important questions, @celebrimbor.eth. As a long term ecosystem participant, I share many of your concerns and believe this discussion is long overdue.

Your observations about tokenomics issues are confirmed by market data:
Optimism’s TVL ($430M) significantly lags behind Arbitrum ($2.4B)
Base, using OP Stack, shows better activity than OP Mainnet itself
The Base revenue sharing agreement shows potential, but doesn’t solve the fundamental problems of the OP token"

Time for changes is limited. I propose:
Create a tokenomics working group from top delegates
Request an official response from Optimism Foundation within 30 days
Organize a community call to discuss the roadmap for changes

Who is ready to support these initiatives? Let’s turn this discussion into an action plan

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Agreed. Optimism needs, at the very least, an ETH-denominated form of revenue distribution.

Why not implement something similar to how Arbitrum generates ETH-denominated (MEV) revenue via timeboost, but instead distribute it amongst staked/locked OP tokens?

This would contribute towards providing an ETH-denominated price floor/anchor for ETH/OP in the long-term.

Other ideas for OP token-demand drivers include:

  • Native superchain interop bridging solution (e.g. Unichain → Base)

  • Gas token but ONLY for sequencer batch submissions to the superchain with a separate fee market to standard transactions (similar to blobs on L1)

  • literally anything else

In my opinion, it’s completely unacceptable for OP to be falling out of the top 100 cryptocurrencies (by market cap) considering how fundamental/complimentary Optimism is for the success of Ethereum.

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The OP token is still the primary method of financing partnerships, grants, and other activities. It wouldn’t make sense to direct revenues to OP holders until that is moving in the right direction. Using the ETH to begin covering, for example, 10% of costs so OP sales aren’t bearing the burden would be more useful.

Optimism ($2.64B TVS) is actually higher revenue per asset secured than Arbitrum ($17.54b), with $5.9m and $16.2m USD-denominated revenue over the last year, respectively. These numbers, however, should indicate how sequencer fees are unlikely to ever be meaningful enough to be the primary source of revenue. Optimism earned ~0.2% fees/assets and Arbitrum ~0.1%. That’s not enough to cover expenses.

We agree, but there has to be a financially sustainable trajectory before any distributions could responsibly be made to tokenholders. Tokenomics is downstream of an updated business plan.

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Very true. Optimism seems to be losing in compariosn to other chains. Certainly OP token does not have any momentum. Big concerns. Another issue is of course participation in the superaccount. Personally though in top 1000 last 2 seasons I do not see any rewards.

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Optimism started as a promising L2 and undertook many initiatives to support across the spectrum be in governance, grants, tokenomics, creating teams of specialist, robust vision, values and more. We saw great participation from the community. Over a period of time innovation reduced, community engagement reduced and governance did not move as envisaged by the team. Tokenomics is important on decisions for short, medium or long term investment. What also lacked maybe is that OP stayed as just a governance and grant token and nothing beyond. Eth has taken over and overshadowed OP token and with its diminishing value its become more fragile.

What I believe still is that Optimism foundation and DAO team has great potential to scale with so many trusted partners who should engage with the community talking about how they have been benefited with the association, support that they received and what are their plans on using OP chain as their strategic partners. This will help in reviving OP but yes we cannot take away the market condition and adoption of retail of overall crypto…. But a beginning to a new chapter is surely possible.

I love you OP!!! Wanna to see you kickass soon…..

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