Arbitrum Price Sinks To A New All-Time Low – What Is Behind This Decline?
September 12 2023 - 4:00PM
NEWSBTC
Arbitrum has managed to maintain its place amongst the top names in
decentralized finance (DeFi) despite the unfavorable conditions
gripping the space in 2023. However, the price of ARB (the
network’s native token), met with a euphoric welcome in March, has
been struggling. The Arbitrum token’s price tumbled to a new
historical low of $0.747217 on Monday, the 11th of September, with
its honeymoon phase seemingly over. The token’s value dipped by
more than 12% in the past week, leaving investors wondering what
could be behind this bearish movement. Whales Part With Millions Of
ARB Token In Selling Spree ARB’s latest price downturn has been
associated with the increased market activity of Arbitrum whales in
the past few days. On Monday, crypto journalist Colin Wu reported
that three whales transferred 10.23 million ARB (worth about $8
million) to Binance. The first whale reportedly sold 3.8 million
ARB at $0.77 per token, while the second whale – with the pseudonym
vladilena2.eth – sold 3.63 million ARB at $0.83 per token.
Meanwhile, the third whale moved 2.8 million ARB for $0.79 per
token. Related Reading: Shiba Inu Hits Make-Or-Break Price: 250%
Rally Or New All-Time Low? This seeming loss of interest from
whales may have precipitated the downward pressure that pushed
Arbitrum to a new all-time low. Unfortunately, there appears to be
no end, as whales have continued to dump their ARB tokens in the
last few hours. According to a Lookonchain report, seven whales
have dumped 20.41 million ARB tokens (valued at about $16.05
million) in the last 30 hours. The blockchain analytics platform
revealed that these whales generated a total loss of $8.15 million.
It is worth noting that general market sentiment may have also
contributed to ARB’s price performance. As of this writing, the
Arbitrum native token is valued at $0.781039, according to
CoinGecko data. Other Possible Reasons For Arbitrum Price
Decline Another plausible reason for ARB’s recent price downturn is
the dwindling activity on the Arbitrum network. While the chain
continues to hold its own as a prominent L2 network, it has been
experiencing a steady decline in total value locked (TVL).
According to DefiLlama data, Arbitrum has a total value of $1.65
billion in assets locked on its network, reflecting a more than 35%
decline in the past four months. This current figure also
represents the network’s lowest TVL since March. The sustained
decrease in total value locked suggests a loss of investor
confidence, which could discourage participants from onboarding the
network. Related Reading: Analysts Are Bullish On ADA But
Price Keeps Tanking, What’s Going On? Recent governance proposals
are another factor that may have contributed to the latest fall in
Arbitrum price. Notably, PlutusDAO introduced a proposal on
September 9 seeking to return tokens from the DAO treasury to ARB
holders. If approved, the governance proposal would involve
activating a staking mechanism and the creation of native yield for
participants, which could see the annual release of up to 2% of the
total token supply. Some investors view this proposal as
inflationary, as it would likely exert downward pressure on the
price of Arbitrum. Ultimately, ARB’s latest market
performance appears to result from a combination of loss of
investor interest, dwindling network activity, and unsatisfactory
governance mechanisms. ARB Price continues a downward trend
on daily timeframe | Source: ARBUSDTS chart on TradingView Featured
image from SoFi, chart from TradingView
SHIBA INU (COIN:SHIBUSD)
Historical Stock Chart
From Jun 2024 to Jul 2024
SHIBA INU (COIN:SHIBUSD)
Historical Stock Chart
From Jul 2023 to Jul 2024