Dispatch #132: All Aboard Arbitrum

Mar 25, 2023 3 min read

Dispatch

In this patch of your weekly Dispatch:

ARB brings energy back
Crypto draws SEC ire (again)
BTC at $1M?

The Big Idea

Arbitrum Launches ARB Token

Bear market airdrops just hit different, don’t they? Especially when they come from a project with as much excitement and dynamism around it as Arbitrum.

Arbitrum and Optimism are the two biggest Ethereum L2s by TVL. Optimism launched its OP token last May, but until now, Arbitrum, which represents about 55% of the market share for Ethereum L2 activity, had been tokenless.

That changed on Thursday, March 23 when the project airdropped about 12.75% of the token supply of ARB to the market. On Wednesday, they broke their previous record for daily transactions with over 1.3M, while the Ethereum mainnet processed around 1.08M. Since the announcement of the airdrop, Arbitrum has gained over 400,000 new users in just two weeks, taking their total user base to over 3M.

Importantly, Arbitrum identifies the airdrop as their “official move” to become a DAO, with ARB holders being able to participate in key governance decisions.

One look around crypto Twitter and it’s not hard to tell how much excitement the airdrop has brought back to a market. After the year we’ve had, we could use it!

P.S. Guess what our latest listing is. 👀

The Latest In…

Regulatory Action

Another quiet week in crypto regulatory land…NOT.

Coinbase announced this week that the SEC had sent them a Wells notice, notifying them that the agency might soon pursue enforcement actions around the listing of unregistered securities. Meanwhile, lest you think that US regulators are content going after US companies, Tron founder Justin Sun has also been sued by the SEC on charges that TRX and BTT are unregistered securities as well as accusations of market manipulation through wash trading. Rough week, friends, rough week.

The Latest In…

Central Bank Digital Currencies

Ever since Facebook started talking about Libra, CBDCs have been lurking around the corner. Many countries are studying them and some, led by China, are in active trials.

The U.S. has tended to have a slightly different discourse, with many politicians asking whether they’re really necessary and CBDCs becoming an increasingly partisan issue. The White House’s recent scathing report on crypto argued that there was nothing cryptocurrencies did that a CBDC couldn’t do. In the same week that came out, presumptive US Republican Presidential nominee Ron Desantis unveiled legislation that would block Florida from adopting any future CBDC. This follows last month’s introduction of an Anti-CBDC act in Congress.

With US Presidential elections just around the corner, is this an issue that will go mainstream?

The Week’s Most Interesting Data Story

Balaji’s Million-Dollar Bet

If you’ve been anywhere near Twitter in the last week or so, you’ll have seen the chart below. It’s the Fed’s balance sheet and it shows a near $300B jump as banks avail themselves of emergency liquidity programs. This has been exhibit A for Bitcoiners who think that Bitcoin’s time has come amidst bank turmoil.

Chief among those is Balaji Srinivasan who has made a number of high-profile seven-figure bets that the price of Bitcoin would hit $1M in just 90 days. Whether the bet is a serious assessment of the potential for imminent hyperinflation or just a way for Balaji to get us all talking about it is the subject of much debate. If it’s the latter, however, it’s worked!