Following the highly publicized airdrop, ARB, the new token in the Arbitrum ecosystem, exploded to $11.80 – an all-time high before trading at $1.21 before dumping, representing a 90% drop from the record high.
This massive pullback has been attributed mainly to the heavy selling pressure caused by ‘Buy the News Story’. Investors positioned themselves for the March 23rd airdrop but immediately began dumping ARB tokens.
in the last 24 hours, arbitrum price It lost another 5%, although its trading volume is still above the 1 billion mark after surging 80% over the same period.
Arbitrum Foundation is racing to save the first ARB proposal
Ecosystem’s first governance proposal The weekend got off to a rocky start, seeking to allocate 750 million ARB tokens, worth around $1 billion, to the Arbitrum Foundation.
According to communications from the foundation, those ARB tokens will be sent to a “special grant” program focused on fueling development on Arbitrum, a layer 2 settlement protocol.
According to AIP-1, the Arbitrum Foundation will have full discretion to allocate approximately $1 billion, and ARB holders will not be able to participate in the decision-making process.
In other words, due to the centralized nature of the Arbitrum Foundation, the special grant program will be put through a “full on-chain governance” process that allows token holders to provide direction to the ecosystem.
Arbitrum Has AIP-1 Ratification, Foundation Clarifies
The Arbitrum Foundation was forced to come clean on certain decisions it made regarding the proposal and other issues without input from the community.
In an explanation on the ratification of AIP-1, the Foundation told members that prior to taking over the reins of the decentralized autonomous organization, certain decisions and actions were paramount to the success of the ecosystem – and that everything was done in good faith and “ with” the sole goal of ensuring that Arbitrum is positioned to succeed and compete with its peers.
For example, the Foundation was established to initiate and streamline the decision-making process in order to avoid “operational questions such as who hosts the various governance forums where these discussions take place” as well as wider Questions like “Who starts the rule. ,
The Foundation acknowledges that it did not clearly communicate its intentions to the community, saying that “the purpose of the proposal was to serve as a ratification of the initial setup of both the Arbitrum DAO and the Foundation created to serve the DAO.” Furthermore, the Foundation did not inform the community about important decisions made earlier.
“Establishing an initial distribution of tokens to Foundations is a common course of practice in establishing an ecosystem such as Arbitrum, and this was always the intent when AIP-1 was submitted for ratification alongside the announcement of the Arbitrum DAO,” Foundation explained.
Standing firm with the decisions it has already made, the Arbitrum Foundation assured the community that ARB is “unique because it is the only one among its peers in which the vast majority of community tokens are currently controlled by DAOs on-chain.” “
The Foundation insists that this is the only Foundation reaching out to the community to help with the ratification process of decisions made before The DAO.
On the massive $1 billion grant in ARB tokens, which is expected to be off-chain, the foundation said it was common practice to allocate “a significant token buzz” and to avoid “voter fatigue,” which many effective May consider way for small grants.
The $1 billion Special Grant Proposal is essential to the success of the Arbitrum ecosystem.
Arbitrum Price Still Underwhelmed – Where to Go Next?
arbitrum price Trading at $1.21 after taking off support at $1.1. The newly airdropped coin was expected to extend its leg to $1.4, where it would have activated a 25% double-bottom pattern breakout to $1.73, but it seems to have been lost.
For now, the short-term support at $1.20 holds the most significance for the bulls and bears. If this support is defended at all costs, Arbitrum price could gain momentum towards $1.40 and $1.733 as buyers build confidence in its recovery.
However, a sustained break below the same support level would mean an increase in overhead pressure, with the ARB likely to retest the key $1.10 support area.
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