Arbitrum DeFi activity on the network has made great progress following the launch of a short-term incentive program.
As Koinfinans.com reported, in early October, the Foundation announced that it had begun distributing ARB tokens for the first phase of a short-term incentive program. As part of this move designed to increase liquidity across DeFi protocols, approximately 50 million tokens will be distributed to 28 ARB-based protocols.
More than a month has passed since the incentive program and so far it seems to have had the expected effect. Data from IntoTheBlock according tothe total value of locked assets at Arbitrum has increased by 26% since the launch of the short-term incentive program.
At the same time, the number of users increased by 27%, showing that the program achieved its goal of bringing new users to the layer-2 network.
On-chain data shows that GMX, a DeFi perpetual trading platform on Arbitrum, posted the largest TVL growth in dollar terms, adding nearly $100 million more. Similarly, Angle Protocol, a stablecoin protocol on the network, has managed to increase its TVL by 5900% since the program’s introduction.
Like the other 26 protocols that will benefit from the Arbitrum Foundation program, GMX and Angle Protocol have launched liquidity mining programs with ARB rewards. Thus, users deposited more money into their respective platforms to maximize the return on the DeFi portfolio.
Meanwhile, IntoTheBlock also reveals that lending protocol Silo Labs and market-making platform Gamma Strategies use ARB incentives more efficiently than others. Since the program began, these protocols have seen their TVL increase by approximately 60x and 50x, respectively.
The Arbitrum DeFi ecosystem, which recently welcomed PancakeSwap perpetual, has undoubtedly benefited from the launch of the short-term incentive program. However, the price of the project’s native ARB token has lagged behind, posting a slight gain of 8% in the past month.
This trend can largely be attributed to the impact of new Arbitrum tokens flowing into the open market through the incentive program. But in the long term, the community hopes that users attracted to the ecosystem will stay and positively impact the altcoin price.
ARB is currently trading at $1.01, down slightly from its monthly high of around $1.2. According to DeFilLama, the token has a market cap of $1.2 billion, while Arbritrum DeFi ranks as the fourth largest chain according to TVL.