Arbitrum Announces New Rewards Program in Offer to Revive Ailing ARBs
Arbitrum, a popular layer-2 rollup scaling solution for Ethereum, witnessed a decline of over 17% daily active users in the last 24 hours. The chart failed to surpass 300k and currently stands at 244k. Trading activity on the platform remains dull as transaction costs follow a flatter trajectory over the last few days. These figures resulted in a 16.8% drop in the native token, ARB’s price, to $1.12, as per CoinMarketCap data. However, the Arbitrum community can expect positive changes soon.
Arbitrum introduced a new decentralized autonomous organization (DAO) revenue mechanism in Twitter’s official announcement. Through this mechanism, token holders can benefit from accumulated surplus fees. Arbitrum will distribute 3,352 ETH, worth over $6 million, to its DAO as part of the bounty generated through fees. The protocol will also establish a revenue distribution mechanism, which is achieved by triggering smart contracts periodically, ensuring timely distribution of rewards.
Transaction fees on the Arbitrum One network consist of two units – L1 and L2 fees. The former covers fees for posting transactions on the Ethereum network, while the latter covers the use of resources on the Arbitrum network. The L2 fee for sending one ETH on Arbitrum is just $0.23, compared to $3.14 on Ethereum, according to L2 Fees.
Despite a 5% drop in the total value of assets held by Arbitrum to $5.82 billion last week, Arbitrum remains king among L2 with a 66% share of total locked up value (TVL).
Investor sentiment for ARB is negative, indicating that they anticipate more losses. The MVRV ratio is negative, indicating that most shareholders will incur a loss if they sell at the current market price. Moreover, the profit daily transaction volume recorded a sharp increase last week before dropping.
In conclusion, while the recent decline in daily active users and ARB prices may be cause for concern, Arbitrum’s new DAO revenue mechanism could bring positive change. The platform’s low transaction fees and substantial share of TVL continue to make it the dominant player in the L2 scaling solutions space.