Arbitrum: Proposal for activating token staking approved

The Arbitrum DAO organization recently announced the approval of a governance proposal that aims to allow ARB token holders to stake their holdings and, in return, they would get a yield paid in tokens.

According to the document, the income must be financed by the Arbitrum treasury, in addition to being distributed over a year through a smart contract.

“Arbitrum DAO treasury is growing rapidly, but this growth is not currently being shared with token holders. The Arbitrum DAO treasury address contains 3.54 billion ARB tokens, and an unexpected $69.4 million in unclaimed individual ARB airdrops was recently returned to the DAO treasury. The treasury is exceptionally well funded and it is important to note that the DAO fully controls the use of the Arbitrum DAO treasury and that all excess revenue belongs to the DAO. This includes sequencer recipes”, he highlighted.

The proposal closed on November 6th. Originally, the text included a tiered system for allocating tokens. In this sense, there would be the options of allocating 1% (100 million tokens), 1.5% (150 million tokens) or 1.75% (175 million tokens) of a total of 10 billion. Furthermore, the proposal featured the provision of the ARB token as a staking reward.

“Along with creating a locking mechanism, we propose to request 1.75%, 1.5%, 1.25% or 1% of the total supply of ARB tokens from the DAO Arbitrum treasury and distribute it over 12 months through of the proposed blocking mechanism. The final value would be decided with a Snapshot and that decision would be cemented in the network with a Tally vote.”

The proposal presented that the annualized percentage yield has an estimate between 7.84% and 78.43%. The yield depends on the percentage of the ARB supply that is staked by holders.

At the time of publication, the price of Arbitrum was quoted at US$1.12, up 4.9% in the last 24 hours.

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