Scalability of Ethereum Decentralised autonomous organizations (DAOs) in the Arbitrum ecosystem has received a distribution of ARB tokens valued at $120 million.
Arbitrum sent airdrops to 125 out of 137 DAOs
Several top Ethereum analytics companies, including Nansen, Arkham, and LookOnChain, indicated that there had been almost 100 million ARB transfers to addresses of qualified protocols. 113 million ARB tokens, which are first allotted to 125 DAOs and are currently valued at $148 million, are awarded to them. According to Spotonchain, over 90 million ARBs, or about $120 million at the current exchange rate, have already been distributed.
The top beneficiaries are Balancer, Dopex, Radiant, SushiSwap, Treasure DAO, and Dopex.
The largest allocation of 8 million ARB tokens each will go to Treasure DAO and GMX. SushiSwap, Balance, Uniswap, Curve, and Dopex will each receive between 3 and 5 million ARB tokens.
In addition to the aforementioned programs, 118 more ecosystem protocols will also get varied portions of the ARB airdrop. The token distribution is anticipated to be finished by this week’s end, according to the Arbitrum team.
Arbitrum Airdrop to support ecosystem expansion
Distribution of the DAOs’ portion of the ARB airdrop will be left up to them. Users can be rewarded in the past, or they can roll out new ARB incentives to encourage usage and liquidity.
The Arbitrum team detailed the purpose of the airdrop to DAO treasuries in a blog post as being the “localization of community governance.” For instance, PlutusDAO promised to use the extra money to “make Plutus stronger than ever before.”
The additional $130 million injected into the Arbitrum ecosystem, according to Mechanism Capital co-founder Andrew Kang, may increase the liquidity of all Arbitrum DeFi ventures. He emphasized that these rewards served as the “flywheel that gave the L1 token 100%+ APY” within those ecosystems on Layer-1 platforms.
Similar initiatives to increase liquidity and utilization were recently introduced by Optimism as well.
The Data Nerd, an Onchain data analyst, hypothesized that protocols with lower market capitalizations would probably profit the most from ARB incentives.
The researcher compared the ratio of ARB rewards to each protocol to its market valuation and discovered that ecosystems like Vesta Finance, PlutusDAO, and Yin Finance are getting incentives many times their present market capitalization, which might promote ecosystem expansion.
Arbitrum Whale Sold Soon After Airdrop
Just after it happened, a whale by the name of “TRIDENT” sold 131,345 ARB while using three addresses. For $1.31 per, the whale made $172,000 after selling the tokens.
It’s possible that the price was impacted negatively by the whale selling off their ARB tokens. However, the airdrop occurred after a correction in the cryptocurrency markets.
Furthermore, ARB has been discharged by whales previously. Two unnamed whales sold out millions of dollars worth of ARB tokens earlier in April, despite suffering losses. The first whale dropped 2.03 million ARB tokens for a loss of $1.14 million and $160,000 in total. While the second whale only sold 1.7 million ARB. When the whale sold nearly $2 million worth of Arbitrum, it suffered a loss of $270,000.
Analyst Jack Niewold believes that ARB has the potential to outperform popular cryptocurrencies like Hedera, Aptos, Stellar, ICP, ETC, LEO Token, Avalanche, and XRP. ARB’s ability to ensure that its holders have access to leveraged ETH beta that cannot be liquidated makes this achievable. The expert chastised the ARB community, adding, “You sold the airdrop.”