OmiseGO (rebranded to the OMG Network) is a scaling solution for Ethereum that is fully compatible with ERC-20 tokens and ETH.
Promising lower gas costs and faster confirmation times, the OMG Network aims to mitigate some of the scalability issues that hinder Ethereum.
What is OmiseGO (OMG)?
OmiseGO (rebranded to OMG Network) is a Layer 2 solution for transferring value trustlessly on Ethereum. It aims to reduce transaction fees and times without compromising the security of Ethereum.
In essence, the OMG Network helps solve the scalability issues that Ethereum currently has.
How OmiseGO (OMG) works
The OMG Network is what’s known as a Layer 2 solution. A Layer 2 solution is built on top of an existing blockchain (in this case, Ethereum). As transactions are processed on the “secondary” layer, precious block space is freed up on the Ethereum blockchain as a result.
In some sense, you could think of a Layer 2 solution as a kind of blockchain on top of a blockchain.
The OMG Network is supposed to have the same security as Ethereum, but with lower transaction fees and faster transaction times – and it works with all ERC-20 tokens and ETH.
This is good news for pretty much anyone using Ethereum. While it has brought forth many exciting innovations, the Ethereum network can become exceedingly costly to use at times, especially for smaller transactions.
The OMG Network also has proof of its success. A portion of the supply of the biggest stablecoin in the world, Tether (USDT), has been issued on the OMG Network.
The OMG Network is just one such Layer 2 solution amid a sea of competitors aimed at scaling Ethereum, such as Optimism, Loopring, and zkSync.