Home | Crypto News | Arbitrum DAO Expands Grant Budget by $23M to Support More Projects

Arbitrum DAO Expands Grant Budget by $23M to Support More Projects

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The Arbitrum DAO, part of the Ethereum blockchain’s layer-2 scaling solution, has recently moved significantly to expand its grant program. This initiative is set to bolster the development of various projects within the Arbitrum community, marking a notable increase in the platform’s support for emerging technologies.

A recent vote by the Arbitrum community, held between November 18 and December 2, led to the decision to disburse an additional $23.4 million in tokens. This move aims to fund all the projects approved under the Short-Term Incentive Program (STIP) but was previously unfunded due to the program’s cap of 50 million ARB tokens. As a result, an extra 21.1 million ARB tokens, equivalent to $23.4 million, will be distributed to 26 additional projects.

The decision to increase the funding was backed by a majority vote, with 216.7 million votes in favor versus 73.1 million against. This increased funding raises the total STIP budget to 71.4 million ARB tokens, supporting 56 projects. The goal is to nurture diverse and emerging builders and to foster a more welcoming environment for new projects in the Arbitrum ecosystem.

Arbitrum operates as a layer-2 network, enhancing the Ethereum blockchain’s capacity for faster and cheaper fund transfers. The network is governed by holders of ARB tokens, which also generate revenue through transaction fees. According to data from DefiLlama, Arbitrum generated over $180,165 in fees and $43,342 in revenue on December 1 alone. For the month of November, its total fees amounted to $5.93 million, with revenues reaching $1.47 million.

The newly approved budget will fund various projects, including Gains Network (4.5 million ARB), Wormhole (1.8 million ARB), and Stargate Finance (2 million ARB). Notably, PancakeSwap withdrew a proposal for 2 million ARB due to the STIP’s Know Your Customer (KYC) requirements.

However, this decision to provide additional funding was not without its critics. Some delegates, like those from MUX protocol, opposed the move, arguing that it could lead to funding projects of mixed quality. They advocated for support to projects with strong fundamentals and reasonable grant sizes but were concerned about including varying-quality proposals in a single funding bundle.

Other members of the Arbitrum DAO suggested that conducting a full second round of funding would have been a fairer approach to include additional protocols in the incentives program, instead of back funding. Despite these concerns, the decision is a significant step towards expanding the scope and impact of projects within the Arbitrum network.

Jay Solano

Jay Solano

Jay is a crypto and NFT enthusiast dedicated to exploring the dynamic world of digital assets. As a crypto blog writer, he is sharing his knowledge of the latest trends, breakthroughs, and investment opportunities in the blockchain world.

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