Arbitrum is considering disbursing nearly $90 million worth of its native token, ARB, through a long-term incentives program. This initiative aims to incentivize usership and development on the layer-2 network.
Arbitrum is a layer 2 scaling solution for Ethereum, designed to improve the scalability and performance of the Ethereum network. It uses the Optimistic Rollups to increase the transaction throughput and reduce the fees on the Ethereum blockchain.
Arbitrum aims to provide a more efficient and cost-effective platform for decentralized applications (dApps) and smart contracts.
Building up to this development, the Arbitrum DAO (Decentralized Autonomous Organization) recently voted on allocating 45.8 million ARB tokens, which is roughly $90 million, for the proposed incentives program.
The plan involves a five-person council responsible for pre-screening grant recipients and three advisers offering feedback on project proposals.
This is one of several proposals passed in the past five months to encourage ecosystem development for developers and Web3 teams. Each of the proposals has seen the release of millions of its native tokens to projects being built on the Arbitrum network.
An example is the $44 million contest it conducted in October, while another $20 million was released the following month. Reflecting on the value of its Treasury, which has more than doubled over the last three to four months, the DAO has shown commitment to supporting the growth of builders in the Web3 space.
Despite some concerns expressed by a minority regarding the centralization of the Arbitrum ecosystem, the resounding 97% support for funding the new incentives program reflects a shared belief in its potential positive impact on the ongoing growth and development of Arbitrum.
In January 2024, Arbitrum achieved a remarkable milestone by surpassing Ethereum’s mainnet in trading volume. The decentralized exchange (DEX) volume on Arbitrum reached $1.8 billion, surpassing Ethereum by nearly $400 million.
This recent success is indicative of Arbitrum’s overall outstanding performance, drawing increased attention to its capabilities within the blockchain space.
