🏴‍☠️ Unpacking Arbitrum Orbit and the $ARB Airdrop

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Flooz

7 min read Mar 21, 2023


Talking points

  • 📦 ARB-itrum you ready?

  • 👀 Fake NFT volumes

  • 🤯 Sony joining the NFT space

📦ARB-itrum you ready? 

At long last, ARB is coming. Arbitrum is (finally) dropping its token. Airdrops have been exploding all over the place so far this year and we are about to add one more to the list.

ARB Airdrop

For those who don't know, an airdrop is when a cryptocurrency project distributes tokens to its community for free as a way to create awareness and encourage adoption. And $ARB is doing just that, giving away free tokens to its loyal supporters!

One of the most anticipated token launches in crypto history, ARB will be used to govern over the Arbitrum ecosystem, and yes, will be airdropped to early users.

But that’s not the only big news of the day. Arbitrum has also announced Arbitrum Orbit, a framework for creating L3s that settle to Arbitrum-based rollups.

Built for scale?

Arbitrum is a layer-2 solution developed by Offchain Labs that addresses Ethereum's scalability limitations while maintaining its security and decentralization. With a maximum capacity of around 25 transactions per second, Ethereum has been challenging for developers building complex dApps.

Arbitrum is a suite of secure scaling solutions that enables developers to build efficient and secure dApps at a low cost while relying on Ethereum's security. Layer-2 solutions process transactions off-chain, reducing congestion on the main blockchain, leading to faster transaction processing and lower fees.

With Arbitrum, developers can build scalable, secure, and decentralized dApps that can process thousands of transactions per second, unlocking the full potential of the Ethereum blockchain.

🥏 TL;DR of ARB

Let’s break down what we know so far about ARB.

ARB will be used to participate in the Arbitrum DAO, which will govern over the Arbitrum ecosystem including Arbitrum One (the “main” L2 which most refer to as just Arbitrum), and Arbitrum Nova.

Notably, Arbitrum will be the first L2 to have “self-executing governance,” meaning that governance will happen entirely on-chain and that proposals do not have to be implemented manually by the core team.

Arbitrum is also creating what’s known as the “Arbitrum Security Council,” which is a 9/12 multi-sig that will have the authority to make changes to the rollup in the event of a security emergency. The composition of the Security Council will be determined by the DAO.

It also appears that tokenholders will control the rights to Arbitrum IP, as DAO governance has the ability to approve the creation of other L2s that settle to Ethereum which are built using Arbitrum's tech.

These L2s can either be governed by ARB holders (a governed chain), or have their own independent governance system (an ungoverned chain). DAO governance does not have to approve the creation of L3s that settle to Arbitrum itself (more on this later).

Did we miss anything? Oh right. There WILL be an ARB airdrop to early participants within the ecosystem, and the token is set to go live on March 23.

🛰 TL;DR of Arbitrum Orbit

Now, it’s time to take a look at the second big announcement from Arbitrum…Orbit!

As mentioned above, Arbitrum Orbit is a development framework for creating Layer 3s (L3s).

L3s are “L2s for L2s” in that they refer to a rollup that settles to another L2, rather than an L1. L3s still retain the security guarantees of an L2 but have the potential to provide a massive increase in scalability, as throughput compounds in each layer of the stack.

For example, let’s say an L3 has a 10x increase in throughput relative to an L2, and an L2 has a 10x increase in throughput compared with L1. This means that the L3 has a 100x increase in throughput over L1. This massive increase in scalability means that L3s are well suited for use cases like order-book exchanges, games, or other high throughput use cases that require incredibly fast and cheap transactions.

Orbit is permissionless, as developers can use the tech to create an L3 that settles to an Arbitrum Chain without requiring the permission of the DAO. Orbit will also be compatible with Arbitrum Stylus, a future upgrade that will enable developers to build dapps in traditional programming languages including C, C++ and Rust.

Now, that we have a tldr of ARB and Orbit, let’s dive into the airdrop!

So, how do we get free tokens?

Well, to know if you are eligible, you need to check through the official Arbitrum site (We will provide this at the end of this section) in which you’ll need to connect your wallet and it will tell you whether you meet the criteria to receive $ARB tokens.

Simple, right?

You can see the full requirements and explanations here

So, can we still take part in this airdrop?

Sadly, if you have not previously interacted with the Arbitrum ecosystem or met any of the above requirements, you will not be eligible for the airdrop, which is not what you want to hear I’m sure, but there will be plenty of airdrop opportunities in the future, but be cautious as there are many scams and invalid links, so make sure you do your due diligence before potentially participating.

When can we expect the tokens to be released?

On March 23, 2023, the community members can expect to receive an airdrop of the token, which will allow them to participate in the decision-making process for the Arbitrum ecosystem.

The foundation behind the Arbitrum ecosystem has plans to make it one of the most decentralized Ethereum scaling chains available. In line with this, a total of 11.6% of the tokens will be allocated to core contributors on the network once specific requirements are met. This move is expected to promote network participation and further decentralize the ecosystem.

👀 Fake NFT volumes

The last few months have seen a surge of interest in NFTs which may also have to do with the release of Ordinals but also for airdrops such as the most recent and biggest of the year so far, Blur.

This airdrop in particular saw a HUGE influx of users moving over to the Blur marketplace, leaving Opensea with some trouble keeping hold of its active user base. Now while may seem like a positive for the NFT space, there is still one underlying issue, and that is the dreaded wash trading…

If you're not familiar with wash trading, it's when someone artificially inflates the volume of a particular asset by buying and selling it to themselves. Essentially, it's a way to manipulate the market and make it appear as though there's more interest in a particular asset than there really is.

Unfortunately, wash trading has become a problem in the world of NFTs. As more and more people get into the NFT game, there are some bad actors out there who are looking to make a quick buck by artificially inflating the value of their NFTs, or increasing airdrop rewards, as seen with the Blur airdrop recently.

But why are we talking about this now?

According to recent reports, there was a 120% increase in wash trading of NFTs in February 2023. That's a big jump, and it's cause for concern for those who are invested in the NFT market as no one wants to play for an overinflated asset, right?

Although, NFTs are looking stronger going into 2023.

https://docs.arbitrum.foundation/airdrop-eligibility-distribution?utm_source=flooz.beehiiv.com&utm_medium=referral&utm_campaign=unpacking-arbitrum-orbit-and-the-arb-airdrop

So, what does this mean for the NFT market?

Well, for one, it could lead to a loss of trust and legitimacy. If people start to realize that the NFT market is being manipulated, they may be less likely to invest in it. It could also lead to increased regulation, which would be a double-edged sword for the crypto community.

But don't worry, there are things that can be done to combat wash trading within the NFT market. Firstly, platforms can implement stricter rules and regulations around buying and selling NFTs. They can also work to educate their users on the dangers of wash trading and the importance of transparency and honesty in the market.

Another option is to increase the fees, as wash traders would be less inclined to do it, but no one wants higher fees as they suck, and we want to save pennies remember!

Either way, a 120% increase in wash trading for February is not a great sign, but seeing the NFT market volumes increase and also competition for NFT marketplaces also grow is only a good sign and hopefully a positive sign for the future!

If you want to see a dope thread diving deeper into wash trading, check the link below 👇

🤯 Sony joining the NFT space 

While on the topic of NFTs, tech giants Sony who are famous for the PlayStation and their fantastic electronic technology have had their patent called ‘NFT Framework For Transferring And Using Digital Assets Between Game Platforms’ successfully published.

So, what does Sony have to do with NFTs?

Well, they recently filed a patent for a system that uses blockchain technology to authenticate and track NFTs. In other words, they're trying to create a way to verify the authenticity and ownership of digital assets like never before.

But why is this such a big deal?

For one, Sony is a massive company with a lot of influence. If they're investing in blockchain and NFT technology, it's a good sign that others will follow suit. It also means that more mainstream companies are starting to recognize the potential of crypto and are willing to put resources behind it, well, excluding Meta it seems but hey, that is their loss, right?

This is a fantastic step forward for the Web3 space, as the more big players that get involved, the faster trust and adoption will occur, providing they make these changes and implementations accommodating, which still seems to be a huge problem.

We salute you Sony, taking a step into the Web3 world is a daunting but most definitely an innovative and forward-thinking decision, and we hope to see more tech giants joining you!

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