Arbitrum to Airdrop ARB Token on March 23

After much speculation, Ethereum’s layer-2 solution Arbitrum has officially announced the date for its ARB token airdrop.

Arbitrum to Airdrop ARB Token on March 23

In an announcement posted on the evening of March 16, leading Ethereum layer-2 solution Arbitrum revealed that it will airdrop its ARB token on March 23.

Details of the ARB Airdrop

ARB is an ERC-20 token issued on Ethereum, with an initial supply of 10 billion ARB and an estimated annual inflation rate of 2%.

The airdrop will distribute 1.162 billion ARB, representing 11.62% of the initial supply. The project has allocated 42.78% to the DAO fund, 26.94% to the development team and advisors, 17.53% to early investors, and 1.13% to the DAOs of projects on Arbitrum.

At the time of the airdrop, the circulating supply of ARB will be 12.75%, amounting to 1.275 billion ARB for the general public and DAOs of projects on Arbitrum.

ARB Token Allocation

The snapshot date for the airdrop was February 6, 2023.

Arbitrum has developed an airdrop scoring system for early users. Eligibility for the airdrop includes usage of Arbitrum One and Arbitrum Nova over the past nine months, interacting with various smart contracts, achieving different trading volumes, and providing liquidity to the layer-2 network.

ARB Airdrop Eligibility Criteria

The number of points accumulated will determine the amount of ARB tokens users can claim on March 23.

ARB Allocation Based on Points

Eligible Arbitrum users can check their airdrop amount on the website provided.

According to Blockworks, a total of 625,143 addresses qualify for the ARB airdrop, with an average of 1,859 ARB per address. However, around 540% of addresses will receive less than 1,000 ARB.

Utility of ARB Token

Notably, ARB will not function as a transaction fee token on Arbitrum One.

Instead, ARB is designed to decentralize Arbitrum One and transform it into a fully self-governing DAO. ARB holders will participate in governance and vote on important updates initiated by the community. Additionally, ARB will serve as the primary token for Arbitrum Nova and future layer-2 products from the project.

Thus, ARB will have a similar limited role as OP from Optimism, another layer-2 solution using Optimistic Rollups technology. Unlike Optimism, which airdropped OP in multiple phases, Arbitrum is opting for a single airdrop event for ARB.

Further Reading:

• Arbitrum in 2022: Still Young with Plenty of Room for Growth
• Tokenomics Research #8: Optimism (OP) – Positive in the Short Term, More Needed Long Term
• zkSync Airdrop Guide: Potential Similarities to Arbitrum Airdrop?

A notable feature of Arbitrum's governance is its self-executing DAO model. Once proposals are approved, changes are automatically applied to the blockchain without waiting for approval from any other intermediaries. Arbitrum aims to enhance decentralization with this new approach and become the first layer-2 to adopt a self-executing DAO model.

DAO governance will be supported by a "Security Council" consisting of 12 members with emergency intervention powers in case of harmful proposals or takeover attempts via the DAO, similar to incidents experienced by Beanstalk Farms. Each Security Council member will serve a six-month term, initially including notable figures from the Ethereum community such as Celer Network co-founder Mo Dong, LayerZero CEO Bryan Pellegrino, Ethereum developer Justin Drake, and three members from Offchain Labs.

Arbitrum Orbit – Layer-3 Development Platform

Offchain Labs, the developer of Arbitrum, has also announced a new product called Arbitrum Orbit. This platform allows developers to build Layer-3 solutions on top of Arbitrum. This move is seen as Arbitrum’s response to Optimism’s OP Stack technology, which enables other projects to create layer-2 solutions using Optimism’s tech, with the most recent example being Coinbase's Base.

As of the time of writing, Arbitrum is the largest Ethereum layer-2 by total value locked (TVL), with $1.63 billion TVL and a 24-hour trading volume of $473.2 million—almost double that of Optimism. If considered independently, Arbitrum would be the fourth-largest blockchain by TVL, surpassing other major names like Polygon, Avalanche, and Fantom.

Top Crypto Blockchains by TVL: Screenshot from DeFiLlama at 9:10 PM, March 16, 2023.