The rise of blockchain-based decentralized finance (DeFi)

Community power with $ARB

Arbitrum announced the launch of its long-awaited DAO governance and its native $ARB token on March 23rd.

According to the Arbitrum Foundation, the launch of $ARB marks the evolution of Arbitrum into a Decentralized Autonomous Organization (DAO). Thus, $ARB holders will be able to determine key decisions governing Arbitrum One and Arbitrum Nova – networks that provide faster and cheaper transactions on the Ethereum blockchain.

“Today’s launch is not only a milestone for Arbitrum; it’s a historic day for Ethereum’s scaling more broadly,” the Arbitrum Foundation said in a statement. “With today’s announcement, Arbitrum has become the first-ever EVM rollup to achieve the second of the three stages.”

The total circulation of $ARB will be 10 billion. A total of 56% of these tokens will be controlled by the arbitrum community – 11.5% will be distributed to the arbitrum community, and 1.1% will be distributed to DAOs operating in the arbitrum ecosystem. The Arbitrum DAO will control the distribution of the remaining community tokens through a treasury.

The other 44% of Arbitrum’s circulation will go to Offchain Labs – the company that built Arbitrum. All investor and team tokens are subject to a 4-year lockup, with the first unlock occurring for one year and periodic unlocks throughout the next three.

‍

Eligibility for $ARB Airdrop

The Arbitrum Foundation and Offchain Labs worked closely with Nansen over the past few months to develop eligibility criteria for the $ARB token airdrop. They developed a points system based on various calculations for network usage.

Users of both Arbitrum One and Arbitrum Nova both received points. Also, early adopters of Arbitrum One (before Nitro) got more points. Users with three or more points are eligible for the airdrop. However, points were also deducted from users who engaged in Sybil-related usage patterns.

You can check the points system and find out more about the eligibility criteria here.

Users who want to be part of Arbitrum’s governance, but do not want to vote actively on the chain, can participate passively through delegation.

Furthermore, Arbitrum included a second mechanism in the form of DAO airdrops, as a way to expand token distribution to new and rare users. Accordingly, only Arbitrum projects with DAO taxes are eligible.

“The goal of using a wide variety of criteria was to recognize that Arbitrum is home to a diversity of projects that have different KPIs and user interactions,” Arbitrum maintained. “It is our hope and our intention that by distributing tokens to Arbitrum DAOs, governance power will ultimately be shared with a wider range of users than just those eligible for the user airdrop.”

Among the exceptions to the DAO airdrop was the inclusion of the Protocol Guild, an organization representing Ethereum’s core developers and contributors.

‍

Arbitrage management with $ARB

The ARB token will only be used for protocol management, unlike ETH, which is used to pay Ethereum (and Arbitrum) fees.

The DAO governance in Arbitrum is self-executing, meaning that the votes will directly influence and execute chain decisions without the involvement of an intermediary. The voting process requires at least 21-37 days before a proposal can be implemented, which ensures that users have time to react to any changes.

In addition, the Arbitrum Foundation established the Arbitrum Security Council, a 12-member multisig of “highly regarded community members” that would monitor the security of the chains and can act quickly when a vulnerability is found. At some point, the DAO can also withdraw the Security Council if it decides that the chain no longer needs its protection.

‍

Launching Arbitrum Orbit

The Arbitrum Foundation also announced the launch of Arbitrum Orbit, a platform for developers to easily and permissionlessly create their own Layer 3 (L3) blockchains. In addition, Arbitrum Orbit L3 chains will support Arbitrum Stylus, which allows developers to build chains in C, C++, Rust, as well as Solidity.

The Arbitrum DAO will be able to authorize additional Layer 2 chains on Ethereum, regardless of whether they are governed by $ARB, and ensure full collective control over Arbitrum.

The Arbitrum One platform was upgraded to Nitro in August. In addition, Arbitrum announced a few months ago that ten independent institutional validators had signed up to validate the platform.

“With the mature technology and validation extended, the next step towards decentralization is today’s launch: giving The Arbitrum Foundation and The DAO ownership of the chain and responsibility for promoting and growing the Arbitrum ecosystem,” the Arbitrum Foundation said.

The community is left with the recent announcement.

According to L2 Beat, Arbitrum has $3.63 billion in TVL in its Ethereum network, Aribtrum One.

‍

What is Arbitrum:

Arbitrum is an Ethereum layer-2 network that enables developers to build and deploy highly scalable smart contracts at low cost. You can use Arbitrum chains to do all the things you do on Ethereum – use Web3 apps, deploy smart contracts, etc., but your transactions will be cheaper and faster. The flagship product of the team, Arbitrum Rollup, is an optimistic rollup protocol that inherits Ethereum-level security.

Website | Documents | Twitter | Blog |

‍

Follow us on Twitter and Instagram to keep up with all the latest BNB Chain and crypto news.

If you need tools and strategies regarding security and crypto education, be sure to check out the tutorials, cryptonomic explanations, and trading toolkits from BSC News.

Want the latest DeFi secrets delivered straight to your inbox every week from a leading industry expert? Learn instantly about strategies that can earn you APYs of up to 69,000% with DeFi Maximizer. Sign up today and get 25% off your first month!

Looking for a job in crypto? Check out the CryptoJobsNow listings!