Chainfeeds Introduction:
On August 16, the Arbitrum community preliminarily passed the proposal to "enable ARB staking to unlock token utility" in order to empower the ARB token. Odaily author Nan Zhi wrote an article to interpret the specific content of the proposal and analyze whether the proposal can reverse the fundamentals of the ARB token.
Source:
https://www.odaily.news/post/5197757
Article author:
Tripterygium wilfordii
Viewpoint:
Nan Zhi: The proposal was put forward by Frisson, the head of market operations at Tally, who hopes to create a mechanism to distribute the income from Arbitrum to token holders, including sequencer fees, MEV fees, validator fees, token inflation and treasury. The specific income to be introduced still needs to be decided by subsequent governance voting. Furthermore, the proposal requires token holders to entrust tokens to "active governors" before obtaining income. At the same time, the proposal introduces ARB liquidity staking tokens stARB through Tally, allowing holders to retain the ability to combine with DeFi protocols and automatically compound interest while staking tokens. Through the combination of the above two modules, ARB holders are expected to obtain income through network activities, and the introduction of stARB makes the governance of tokens no longer restricted, and the combination with income can enhance the activeness of governance. From a fundamental logic point of view, the passage of this proposal is obviously good for ARB, but in practice, another question needs to be considered: how much income is generated from network activities? Even if all network income is distributed to token holders, how much gain can it bring to them? Judging from conventional indicators, Layer 2's market share is still trading sideways at a high level or even rising slightly. However, DefiLlama data shows that the Arbitrum network has only earned $6,000 in the past 24 hours. Since the Cancun upgrade in March, except for a few occasional outbreaks, the daily income has fluctuated between $10,000 and $40,000. Calculated at $30,000 per day, the network's annual revenue is only about $10 million, which is a drop in the bucket compared to ARB's $1.8 billion market value and the recent $60 million in token unlocking per month. In summary, although this pledge-enabling proposal is logically tenable and obviously beneficial to ARB, considering the actual profitability of the network, the degree of benefit is currently limited. The Tally voting plan will be held in October, and relevant holders of ARB tokens are advised to pay attention to the specific plans for the past two months.
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