Arbitrum

<p>The Arbitrum DAO approved a <a href="https://snapshot.org/#/arbitrumfoundation.eth/proposal/0xf22530295daee96dffd7f70854475c06216a4d3594929672f71c12bf638bb0c8" rel="noopener noreferrer nofollow">proposal</a> to create a staking mechanism for the ARB token on Nov. 6.</p>
<p>The vote follows a community debate on whether to activate staking or not for a number of months now and failed to reach a consensus on the matter for weeks due to disagreements over how the yield would be generated.</p>
<h2 id="treasury-based-rewards">Treasury-based rewards</h2>
<p>A key point of contention was whether to mint new ARB tokens as rewards for staking. A significant majority of the Arbitrum community was against the idea of diluting the token’s supply.</p>
<p>Ultimately, the latest proposal chose to exclude the option to mint new tokens from the proposal, securing a favorable vote.&nbsp;The proposal will allow ARB token holders to stake their tokens and earn yields directly from the Arbitrum treasury via a 12-month smart contract.</p>
<p>Approximately 1% of the total ARB supply (100 million tokens) will be allocated for staking rewards, with projected annual percentage yields ranging from 7.84% to 78.43%. The percentage will be based on the amount of staked tokens.</p>
<p>Arbitrum’s staking model stands out by offering direct treasury-based yields, in contrast to conventional methods, which often use network fees to reward stakers.</p>
<h2 id="narrow-margin">Narrow margin</h2>
<p>Roughly&nbsp; 66% of the community voted in favor of the new proposal; however, a notable 33% dissented regarding the use of treasury funds for staking incentives.</p>
<p>Some of these community members argue that staking rewards should be created by minting new tokens, while others are against the idea of staking altogether.</p>
<p>The debate surrounding the use of treasury funds reflects the diverse opinions within the Arbitrum community. The approval indicates a majority consensus in favor of the proposal but acknowledges the concerns of a significant minority.</p>
<h2 id="next-steps">Next steps</h2>
<p>With the proposal finally approved, the DAO will select a service provider, create reward contracts, and appoint an external auditor for the staking system in the coming weeks.</p>
<p>A two-week review period will be initiated to gather community feedback and address the concerns and suggestions from stakeholders.</p>
<p>This approval comes at an opportune time for the Arbitrum ecosystem, poised to navigate market fluctuations. Arbitrum staking may offer a fresh use case for ARB and contribute to a potential market upswing.</p>
<p>The post <a rel="noopener noreferrer nofollow" href="https://cryptoslate.com/arbitrum-community-greenlights-staking-proposal-after-new-mint-function-removed/">Arbitrum community greenlights staking proposal after new mint function removed</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://cryptoslate.com">CryptoSlate</a>.</p>

Arbitrum community greenlights staking proposal after new mint function removed

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