Arbitrum [ARB]: Debut hit by sell-offs, what’s next for the token?
- ARB’s value has dropped by over 85% since launch.
- Daily transactions count on Arbitrum have begun its downward trend.
Arbitrum’s [ARB] value has taken a hit after the token AirDrop on 23 March, with a surge in sell-off activity. According to the on-chain data provider Glassnode, the decline in value commenced soon after ARB was made available for trading across exchanges.
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The #Arbitrum airdrop 💸 has seen a massive sell-off, with $ARB losing roughly 80% after 30 mins upon being listed. Out of the 600k eligible wallets, only a handful got lucky on #uniswap pic.twitter.com/N4xX0Pd33O
— glassnode (@glassnode) March 24, 2023
Realistic or not, here’s ARB market cap in BTC’s terms
Trading at $1.25 at press time, ARB’s price has dropped by 89% since its launch two days ago, data from CoinMarketCap showed.
After the hype comes the decline
In the weeks leading up to the token AirDrop, Arbitrum witnessed a significant increase in its user base, with over 400,000 new users added in just two weeks, according to data from Dune Analytics. This took the cumulative user base on the network to over 3 million.
Moreover, the Ethereum [ETH] Layer 2 scaling system recorded a significant surge in daily transactions on 23 March following the AirDrop, According to data from Arbiscan.
Arbitrum also recorded a new daily high of 2.73 million transactions on 23 March, surpassing the previous high of 1.10 million transactions registered on 21 February.
However, with increased ARB token sell-off and the gradual dissipation of the hype surrounding the token-launch event, daily transactions count on Arbitrum have trended downwards in the last two days. As of 24 March, the chain saw a total count of 1.82 million transactions, representing a 33% decline in just 24 hours.
With many letting go of their airdropped ARB tokens to cash in quick gains, the number of ARB unique holders dwindled in the past two days.
According to data from Dune Analytics, the number of unique ARB holders rallied to a high of 291,000 on 24 March, after which it plummeted. As of this writing, the metric stood at 256,000.
Interestingly, despite the waning desire to hold on to ARB token, and a steep fall in transactions count on the network, Arbitrum’s total value locked (TVL) rose by 2% in the last two days. At press time, the Layer 2 scaling system’s TVL was $2.13b, per data from DefiLlama.
Optimism is not any better
Since the conclusion of its Optimism Quests program on 17 January, Layer 2 network Optimism has suffered a steep decline in daily transactions count.
In September 2022, Optimism launched “Optimism Quests,” a set of 18 tasks aimed at guiding users through various features on the network, including swapping, lending, and staking. During this program, daily transactions on the Layer 2 network steadily increased, culminating in a record high of 760,000 transactions on 12 January, just before the program’s conclusion.
How much are 1,10,100 ARBs worth today?
This marked the network’s most significant daily transaction volume since its launch two years ago, according to data from Etherscan.
Since the program ended, the number of daily transactions on Optimism has fallen by 67%. In fact, while Arbitrum saw a momentary surge in daily transactions count following its token launch, Optimism has since seen an 11% fall in daily transactions.