Arbitrum is a Layer 2 scaling solution that supports smart contracts without scalability and privacy limitations. Founded in 2021 by Offchain Labs, Arbitrum provides a more permanent solution to the fees required to build DApps on Ethereum.
Anyone who builds smart contracts knows that Ethereum is the most popular and efficient platform for building decentralized applications. But in addition to simple on-chain solutions and upgrades that many believe can solve problems related to congested networks, some also believe that the ability of second-layer solutions can reduce transaction costs.
L2 is a set of solutions built on public blockchains designed to increase its scalability and efficiency, especially for small transactions or operations. They are often referred to as Layer 2 network solutions. It uses Optimistic rollup technology to aggregate transaction batches to reduce gas costs. Additionally, Arbitrum, as a layer 2 network solution, is designed to reduce transaction speeds and gas fees incurred using the Ethereum mainnet (layer 1).
Since Off Chain Labs launched Arbitrum in August 2021, many people have been anticipating the launch of the Arbitrum token. Fortunately, to the delight of many investors, the Arbitrum Foundation and Offchain Labs announced an airdrop of the Arbitrum governance token. The $ARB airdrop will officially launch on March 23, 2023.
Arbitrum Economic Model
$ARB Supply and Distribution Overview
Many people are very interested in the supply of ARB and how it will be distributed. It will be distributed through airdrops to the Arbitrum DAO treasury, Offchain Labs, the company behind Arbitrum, Offchain Labs investors, users of the Arbitrum platform, and DAOs built using Arbitrum L2 technology.
Arbitrum ($ARB) is allocated as follows:
17.53% (1.753 billion coins) allocated to Offchain Labs investors
1.13% (113 million coins) allocated to the DAO in the Arbitrum ecosystem
11.62% (1.162 billion) allocated to users of the Arbitrum platform via airdrop
42.78% (4.278 billion) allocated to the Arbitrum DAO treasury
26.94% (2.694 billion) allocated to Offchain Labs team, future team and advisors
According to the Arbitrum website: https://docs.arbitrum.foundation/airdrop-eligibility-distribution
12.75% of the $ARB token supply will be airdropped on March 23, 2023, with 11.62% allocated to users and 1.13% allocated to the DAO. The initial supply of $ARB tokens is 10 billion, with an inflation rate of up to 2%/year.
These token distributions aim to build a diverse and decentralized stakeholder network, supporting a decentralized environment.
Governance style
With the launch of $ARB, the Arbitrum Foundation announced the launch of a self-executing DAO governance model for the Arbitrum One and Arbitrum Nova networks.
The $ARB airdrop will be distributed to eligible Arbitrum ecosystem participants and claims will begin on March 23rd.
As the first L2 solution to introduce self-executing governance, Arbitrum feels this initiative "leads the way." However, in contrast to the ETH used to pay Ethereum (and Arbitrum) fees, the $ARB token is used solely for protocol governance.
Arbitrum’s DAO governance is self-executing, meaning its votes will directly influence and execute on-chain decisions without the need for an intermediary. Before a proposal can be implemented, a 21-37 day voting process must take place to give people ample opportunity to respond to any modifications.
The Arbitrum Foundation has also created the Arbitrum Security Council, a multi-sig group of 12 “well-respected community members” who will monitor the chain’s security and be able to act quickly if weaknesses are discovered. The DAO can also retire the security committee if it determines that the chain no longer needs it.
As a result, the token's governance is fairly decentralized, allowing for decentralized and fast decision-making. Additionally, the Arbitrum Foundation claims that with the launch of $ARB, Arbitrum has transformed into a decentralized autonomous organization (DAO). As a result, $ARB holders will have the ability to vote on important issues regarding networks called Arbitrum One and Arbitrum Nova, which enable faster and cheaper transactions on the Ethereum blockchain.
ARB’s value proposition
Why $ARB? you might ask.
Arbitrum is not the only second layer solution available for the Ethereum blockchain, but as you may have guessed, Arbitrum is the best. Solutions like Polygon and Optimism offer some benefits, but not as much as Optimistic Rollup and more importantly the scalability improvements and privacy features.
Developers can use it to execute unchanged EVM contracts and Ethereum transactions on the second layer, leveraging Ethereum's guaranteed accuracy and benefiting from its superior security. This system has become the protagonist of Ethereum’s second layer scaling options. It holds 50.88% of the entire second tier’s locked value as of June 2022, according to Footprint Analysis.
Impact of Arbitrum adoption and potential growth on ARB token value
The Arbitrum protocol’s native token, ARB, will be listed for trading on major cryptocurrency exchanges on March 23, 2023. As with any new listing, there is a lot of speculation as to how the token price will perform.
According to the ARB price forecast, the highest expected price is $2.32 and the lowest expected price is $1.35. The price of the ARB token is expected to rise steadily throughout 2023, from approximately $1.10 in March to $2.32 in September. However, in the first few months, the price of ARB tokens may be volatile.
https://cryptobullsclub.com/arbitrum-arb-price-prediction-2023-2024-2025-2030-what-will-be-the-listing-price-of-arbitrum-token/
Crypto Bulls Club predicts that $ARB will be listed at $0.60 if users and the DAO supply are opened at the same time. They claim that this prediction is based on a total circulating supply of $1.275 billion of ARB tokens.
However, if only user airdrops were open and tokens from the DAO treasury, advisors, and its team were locked, there would be less supply of tokens, causing the price to rise to approximately $0.66.
Furthermore, the token price is expected to grow significantly in 2024, with a maximum price of $7.04 and a minimum price of $5.41. Multiple factors, including the growing expansion and use of the Arbitrum ecosystem.
As more people start using the Arbitrum system, ARB prices are likely to increase and demand for them will increase. The value of Arbitrum may also rise as more institutional investors and major cryptocurrency exchanges begin to realize the potential of the Arbitrum network.
Airdrop claiming rules and methods
User empty investment qualification
The Arbitrum airdrop will begin on March 23, 2023, so be sure to mark your calendars.
The number of airdrops per user and the users eligible to receive airdrops are determined by a set of criteria established by Arbitrum. Qualifying actions for airdrops typically include:
Bridge funds into Arbitrum
Number of trading months on Arbitrum
Total number of transactions or interactions with smart contracts
total transaction value
Events on Arbitrum One and Arbitrum Nova.
However, more specifically, these are the qualifying actions to earn points on Arbitrum One;
Bridge funds to Arbitrum One
Trade in two different months
Trade in six different months
trade in nine months
Conducted more than four transactions or interacted with more than four different smart contracts
Conducted more than ten transactions or interacted with more than ten different smart contracts
Made more than 25 transactions or interacted with more than 25 different smart contracts
Made over 100 transactions or interacted with over 100 different smart contracts
Total transaction value exceeds $10,000
Total transaction value exceeds $50,000
Total transaction value exceeds $250,000
Deposit over $10,000 in liquidity with Arbitrum
Deposit over $50,000 in liquidity with Arbitrum
Deposit over $250,000 in liquidity with Arbitrum
For Arbitrum Nova, these actions qualify users to earn points:
Bridge funds to Arbitrum Nova
More than three transactions were made
More than five transactions were made
More than ten transactions were made
Each point scored is equivalent to a certain number of Tokens during the airdrop period.
Each standard is further divided into tiers, with higher-tiered standards granting larger airdrops. For example, under the "volume based on time" requirement, trading in nine different months will qualify you for a larger airdrop than if you traded in just two different months.
If an airdrop recipient’s wallet address is found to be a Witch address during the Hop Protocol reward program, they will be placed on the ineligible list.
Other anti-witch rules are as follows:
If the airdrop recipient’s wallet transactions all occur within the first 48 hours, one point will be deducted. If the airdrop recipient's wallet balance is less than 0.005 ETH and the wallet does not interact with multiple smart contracts, one point will be deducted.
On the Arbitrum Foundation’s official website, users can verify the requirements they have met and the airdrop they have been allocated. If looking to sell their ARBs, users can consider centralized exchanges (CEX) as well as numerous DEXs. Multiple CEXs including Binance, ByBit, OKX, KuCoin, and others have announced that they will list ARB on the introductory day.
DAO airdrop standards and distribution
The Protocol Guild of Ethereum contributors and the DAO developing applications within the Arbitrum ecosystem will each receive unique allocations. The weight assigned to a DAO Token depends on several variables, including the length of time the project has been on Arbitrum, the total value of its assets on the chain, its nativeness to Arbitrum and whether it has a true on-chain treasury.
Regarding the distribution of individual DAOs, more information will be added soon. Additionally, all investor and team tokens will be subject to a 4-year lock-up, with initial unlocking after one year and subsequent monthly unlocks for three years, although user and DAO airdrops will be available in a few days.
ClaimARB Guide
Step 1: Check if you are eligible to participate in the ARB airdrop
Before claiming an ARB, you need to make sure you are eligible for the airdrop. Check the qualifications listed above and on the official website.
Step 2: Get an ARB wallet
To claim ARB, you need to have a wallet that supports ARB. You can use any wallet that supports the ERC-20 standard, such as MyEtherWallet or MetaMask. Make sure you have the private key to that wallet.
Step 3: Follow the airdrop instructions
ARB has not been launched yet, but the airdrop rules are ready for launch. Follow the instructions provided by the project team to claim your ARB.
Step 4: Wait for airdrop distribution
After submitting the information, please wait for the airdrop distribution. The project team will announce assignment dates and methods.
Step 5: Verify your ARB
Once you get your ARB, verify you got the correct quantity. You can check your wallet balance or view transaction history using a blockchain explorer.
That’s it! Congratulations, you have successfully claimed your ARB airdrop.
in conclusion
In conclusion, understanding token economics is crucial when engaging as an investor and user in the DeFi ecosystem. As this article highlights, the ARB token presents an exciting opportunity for those seeking to invest in promising new blockchain technologies. Its unique features such as low gas fees, fast transaction times, and interoperability with other blockchains also make it an attractive option for users.
However, it is important to note that investing in any cryptocurrency involves risks and should be treated with caution. Before investing, it is important to understand the underlying technology and project goals.
Going forward, the potential for ARB token value is high as it is tied to the rapidly growing Arbitrum network. As more users and projects adopt Arbitrum, demand for the ARB token will likely increase, driving its value higher.
Overall, the emergence of the ARB token and the Arbitrum network marks an exciting milestone for the DeFi ecosystem. Its unique characteristics and growth potential make it a worthwhile investment opportunity for investors seeking to participate in the world of decentralized finance. As the DeFi space continues to grow, let’s look forward to how Arbitrum and other similar projects will shape the future of finance.
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