Discover the ups and downs of Arbitrum’s ARB cryptocurrency, from its volatile launch to recent fluctuations in price.
The new ARB cryptocurrency from Arbitrum is not doing well. Putting aside what transpired on launch day, $1.4 would appear to be the initial price that is sufficient to be used as a benchmark. This is the price it had stabilized on following the extremely strong initial surge and decline due to a lack of supply.
The price of arbitrum cryptocurrency had been hovering around that level up until April 1. However, recently, it has dropped all the way to around $1.15 before rising back to around $1.2.
Despite yesterday’s decline being caused by technical issues, these are still higher than the $1.13 of March 28.
Crypto Arbitrum issues and their effects on the ARB cryptocurrency
Some others even claim that what happened is a true scandal.
The Arbitrum Foundation, which created the ARB governance token and leads the Arbitrum DAO, held a confirmation vote on decisions it made two days earlier. It sent itself $1 billion in tokens.
The Arbitrum Foundation, a centralized company that promotes the self-described decentralized Arbitrum ecosystem, self-assigned $1 billion in tokens, which angered the DAO community.
However, recent occurrences raise severe questions about the Arbitrum ecosystem’s decentralization, and the ratification vote highlights the DAO’s governance uncertainty.
The foundation then admitted it will split its problematic governance package into multiple votes.
In a crypto DAO, votes represent governance tokens, not voters.
Hence, a single voter can affect the outcome by casting a huge number of ballots.
Even said, the Arbitrum community appears to be able to push back and enforce corrective measures on the foundation that may actually be successful in balancing its huge power in the DAO.
The Arbitrum Foundation-related controversy
The problem is that the foundation appears to have transferred some tokens before the vote to validate their transfer.
The Arbitrum Foundation likely thought that vote was just a formality, but it ended up being negative.
The foundation couldn’t sway the vote, but it might have moved a lot of tokens without DAO approval.
This instance shows that Arbitrum is only partially decentralized.
Although the foundation most likely wields a lot of influence within the DAO, it does appear to run decentralized.
One questions whether the DAO still has sole control over how the Arbitrum ecosystem develops at this time. From this vantage point, it would appear that the foundation holds the true power.
Attempts at fraud
As if that weren’t enough, TrustCheck noted that more than 400 sites were active during the Arbitrum airdrop in an effort to con users who were interested in the giveaway.
These fraud attempts have nothing to do with Arbitrum, but their enormous volume demonstrates how complicated the current scenario is.
TrustCheck, a Chrome addon that detects smart contract scams, found three fake Arbitrum airdrop smart contracts. Their analysts say over $20,000 in ETH and unspecified amounts of MATIC, LINK, DAI, and USDC were stolen.
The cost of the cryptocurrency Arbitrum (ARB)
It is important to note, though, that these dynamics are really quite common in the huge universe of DAOs. These kinds of scandals shouldn’t happen, but they do and not infrequently either.
This is possibly the reason why this incident hasn’t had much of an impact on the price of the ARB coin.
ARB’s price rose above $1.53 on March 25 after starting at $1.4 on March 24.
After that, it sank to $1.2, then $1.13, the current low.
After reaching beyond $1.4 in late March, it is not surprise that the price has plunged 20% in the last two days, back to below $1.2.
The markets appeared largely unfazed by the recent controversy that arose just days after the previous lows, indicating that investors may have already priced in such risks. This could be a sign that the market is becoming more mature and better able to withstand potential disturbances.
Yet, it is unclear if this was a single incidence or a hint of a larger issue that could lead to more incidents.
It is important to note that one of the most often utilized layer 2s on Ethereum is by far Arbitrum.
