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Original file line number Diff line number Diff line change
Expand Up @@ -55,6 +55,8 @@ For an Arbitrum One-based Layer-3, there are three tiers of finality to consider
2. Safe finality from batch inclusion after Arbitrum One's assertion is included in an Ethereum block.
3. Hard finality after the Ethereum block containing Arbitrum One's batch is finalized on Ethereum (~15 minutes)

## should we change that, Derek?

Layer-3 Arbitrum chains can make their own determination about what level of finality to accept. We consider it safe to rely on soft finality, which would practically enable an Arbitrum chain to configure fast withdrawals down to 15 seconds.

## Adoption instructions (example script)
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Expand Up @@ -3,11 +3,11 @@
- **Significantly faster withdrawals and finality**: Reduces withdrawal times from days to minutes, improving user experience and enabling quicker asset movement across chains. This is particularly beneficial for cross-chain dApps, as they can read the finalized state at the same accelerated rate.
- **Enhanced capital efficiency**: Shorter wait times minimize opportunity costs for users, allowing faster re-deployment of funds and better liquidity in DeFi or other applications.
- **Improved performance for AnyTrust**: When combined with AnyTrust mode, Fast Withdrawals leverage existing infrastructure without introducing entirely new trust elements, enabling near-instant withdrawals for non-fungible assets.
- **Flexibility for Layer 3 setups**: For chains settling to Arbitrum One or similar, finality can be configured down to 15 seconds, supporting high-throughput applications.

## Cons

- **Introduced trust assumptions**: Shifts security from the fully decentralized optimistic Rollup model to reliance on a validator committee. For Rollup-mode chains, this means it's no longer a "true" Rollup, as users must trust the committee for fast confirmations. In AnyTrust mode, it assumes at least two honest members in the Data Availability Committee (DAC), which could be a risk if the committee is compromised.
- **Potential delays under high load**: High network throughput can cause confirmation delays beyond the configured rate, with a practical minimum of 1-2 minutes in busy scenarios. Initial setup may also slow the chain temporarily due to backlog processing.
- **Setup complexity and requirements**: Requires upgrading to specific versions, creating a multi-signature Safe wallet for the committee, and running at least three validators. This adds operational overhead and potential costs.
- **Security trade-offs compared to standard withdrawals**: While standard withdrawals maintain full Ethereum-level security via the challenge period, fast withdrawals prioritize speed over decentralization, potentially exposing users to risks if the committee fails or is attacked.
- **Layer 3 setups finality**: For chains settling to Arbitrum One or similar and using BoLD, finality cannot be lowered to 15 seconds.