ARB Protocol

Overview

Arbitrum (ARB) is the governance token of the Arbitrum network, a Layer 2 scaling solution for Ethereum that aims to reduce transaction costs and increase throughput while maintaining Ethereum's security. The token was launched in March 2023 through an airdrop to early users of the platform.

Purpose and Utility

The primary purpose of ARB is to serve as a governance token for the Arbitrum DAO, allowing token holders to vote on protocol upgrades, parameter changes, and treasury management. The token represents actual ownership rights in the protocol's governance system.

Business Model

Arbitrum's business model revolves around providing scaling solutions for Ethereum applications. The network charges transaction fees in ETH, which are used to cover operational costs. The ARB token itself is used for governance and does not generate interest or involve lending activities.

Real-World Adoption

Arbitrum has achieved significant adoption as a Layer 2 solution, with numerous decentralized applications deploying on the network. The platform has consistently ranked among the top Layer 2 solutions by total value locked (TVL) and daily active users.

Development Activity

The project maintains active development with regular updates to the protocol. The development team, Offchain Labs, continues to implement improvements and new features to enhance the platform's capabilities.

Token Distribution

The initial token distribution allocated 56.13% to the DAO treasury, 11.62% to the founding team, and 26.94% to users and contributors through airdrops. Team tokens are subject to a 4-year vesting period with a 1-year cliff, demonstrating long-term commitment.