Ethereum scaling solution Arbitrum has distributed $120 million worth of ARB tokens allocated to decentralized autonomous organizations (DAOs) within its ecosystem.
Leading Ethereum analytics firms like Nansen, Arkham, and LookOnChain reported around 100 million ARB transfers to addresses of eligible protocols. The initial amount allocated toward 125 DAOs is 113 million ARB tokens, worth around $148 million at current prices. Around 90 million ARB, worth around $120 million at current prices, has been distributed so far, per Spotonchain.
The leading recipients include Treasure DAO, SushiSwap, Dopex, Radiant, and Balancer.
Treasure DAO and GMX will receive the highest allocated amount of 8 million ARB tokens each, followed by SushiSwap, Balance, Uniswap, Curve, and Dopex, which will each receive between 3 and 5 million ARB tokens.
Besides the projects mentioned above, 118 other ecosystem protocols will receive the ARB airdrop in varying amounts. The Arbitrum team expects to complete the token distribution by the end of this week.
Airdrop to fuel ecosystem growth
The DAOs will have independence in choosing how to distribute their share of the ARB airdrop. They can reward users retroactively or incentivize liquidity and usage by rolling out fresh ARB incentives.
In a blog post, the Arbitrum team explained that the goal of the airdrop toward DAO treasuries is the “localization of community governance.” For instance, PlutusDAO pledged to “make Plutus stronger than ever before” by using the additional funds.
Mechanism Capital co-founder Andrew Kang noted that the additional $130 million flushed into the Arbitrum ecosystem could help boost the liquidity across Arbitrum DeFi projects. He pointed out that on Layer-1 platforms, such incentives provided the “fly wheel that gave the L1 token 100%+ APY” within those ecosystems.
Recently, Optimism also launched similar programs to improve liquidity and usage.
Onchain data analyst The Data Nerd, meanwhile, suggested that protocols with smaller market capitalizations will likely benefit the most from ARB incentives.
The analyst mapped the ratio of ARB incentives to each protocol to its market capitalization and found that ecosystems like Vesta Finance, PlutusDAO, and Yin Finance are receiving incentives multiple times their current market capitalization, which could help foster ecosystem growth.
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