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The wait for one of the most highly anticipated events in the cryptocurrency industry over the past couple of months is finally over with the announcement of the long-awaited ARB token.
The news means that Arbitrum, one of the biggest players in the Ethereum layer-2 scaling solution landscape, will finally get a token.
The ARB Token Airdrop Date Set
The Arbitrum Foundation, on Thursday, announced that it would be airdropping ARB, Arbitrum’s new token, to the community on the 23rd of March. According to the foundation, the launch of the ARB token officially marks the beginning of Arbitrum’s transition into a decentralized autonomous organization (DAO). This means that ARB token holders will be able to vote on key governance decisions around Arbitrum One and Arbitrum Nova. Both networks allow users to conduct transactions on the Ethereum blockchain, but with far greater speeds and lower fees. In a statement, the Arbitrum Foundation stated,
“Arbitrum DAO will have the power to control key decisions at the core protocol level, from how the chain’s technology is upgraded to how the revenue from the chain can be used to support the ecosystem.”
The Arbitrum Foundation is planning to issue around 44% of the tokens to investors and core contributors. However, Offchain Labs, the creator of Arbitrum, believe that the ARB token would make Arbitrum far more decentralized than other competing chains. CEO of Offchain Labs, Steven Goldfeder, stated,
“For me, the most exciting part is the decentralization – the fact that Offchain Labs will no longer have any control over the future of this chain. We will be a service provider, and if the DAO calls on us to build software, we will.”
According to Goldfeder, Arbitrum worked closely with crypto analytics firm Nansen to create snapshots of user activity. These were carried out to determine which users were eligible to receive ARB tokens. Factors taken into consideration were the number of transactions conducted, the number of applications used, and how long the user used Arbitrum One and Arbitrum Nitro.
Users can check their eligibility for claiming the ARB token during the airdrop by visiting gov.arbitrum.foundation. However, Arbitrum also warned users to be careful while claiming their tokens. This is because hackers and scammers frequently use airdrops for phishing people by sending them to fake websites.
The ARB Token
According to the details available, the ARB token will have a supply of 10 billion, out of which 56% would be controlled by the community. The 23rd of March airdrop will see 11.5% of the total supply go to Arbitrum users and 1.1% to DAOs operating in the Arbitrum ecosystem. The remainder of the community tokens will be sent to a treasury which the new Arbitrum DAO will control. The remaining 44% will go to investors and employees associated with Offchain Labs.
The ARB token, unlike ETH, will be used only for the protocol’s governance. The Arbitrum DAO will feature a self-executing governance process, meaning votes can be used to alter Arbitrum’s core code directly.
But Why Now?
Currently, Arbitrum holds around $3.69 billion locked in its Ethereum rollup network, Arbitrum One, making it the clear market leader. However, the project is one of the largest crypto projects that does not have the token, meaning the community has been clamoring for a token since the project went live in 2021. Arbitrum’s primary competitor, Optimism, launched its OP token almost a year ago and successfully made its transition to DAO governance.
Explaining the delay in launching its own token, Goldfeder stated,
“The tech came first. And based on our technical road map, now was the right time.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.