Arbitrum expects to introduce ARB staking to enhance token utility and improve governance

The community of Ethereum's second layer network Arbitrarum is voting on the implementation of staking mechanisms to release the utility of its native token ARB and increase its on chain usage.

Once the proposal is approved, Arbitrarum will implement the staking function through the Tally governance system and introduce the liquid staking token stARB. The governance organization Arbitrarum DAO reserves the right to enable fee allocation and send fees to ARB stakers, but the current proposal does not include the activation of the 'fee switch'.

The proposal will be open for voting from August 9th to August 16th, and currently has about 99% of the votes in favor.

The article written by Tally's Chief Revenue Officer 0xFrisson emphasizes the current token structure issues of ARB, stating that the token is struggling in terms of cumulative value, with less than 1% of ARBs being used on the chain and only 10% contributing to governance.

Tally is a front-end suite for decentralized autonomous organization (DAO) governance, which allows DAO operators to create a homepage and proposals, and enables voters and representatives to create personal profiles and use their governance rights. Tally collaborates with some of the largest DAOs in the decentralized finance (DeFi) field, including Uniswap and Aave.

ARB's price performance is poor

Arbitrum operates using a scaling solution called Optimal rollups. According to Offchain Labs, the Arbitrum development team, through the development tool Arbitrum Orbit, developers can create their own private chains on Arbitrum One, Arbitrum Nova, Arbitrum Goerli, and Arbitrum Sepolia and connect to one of Arbitrum's Layer 2 or Layer 3 chains.

Some memory blockchain teams have chosen to use Arbitrarum's technology to develop their chains, including the ApeCoin community of the Bored Ape (BAYC) ecosystem and the Ethereum Layer 3 scaling solution Xai.

However, the price of ARB tokens has been on a downward trend for most of this year. Since reaching a historical high of around $2.4 in January, ARB has fallen by about 76%, while Bitcoin (BTC) has risen by over 40% during the same period. Before the deadline, the trading price of ARB was 0.576 US dollars, significantly lower than the price of about 2.1 US dollars when it went public in March last year.

Despite the weak price performance of ARB, the performance of Arbitrum network is relatively stable. Currently, Arbitrarum is the Ethereum Layer 2 network with the highest total locked value (TVL), reaching $2.74 billion.

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