Arbitrum STIP Allocations

Key Insights

• 50 million ARB tokens will be released over the next three months as part of Arbitrum’s inaugural ecosystem incentive campaign.
• GMX, Arbitrum’s leading perpetual trading platform, received almost a quarter of all funding. Many projects that passed the voting round did not receive funding due to the hard cap of 50 million tokens.
• 63% of funds will be distributed as liquidity incentives, 32% will go to “active users”, and 5% will be allocated to partnerships within the ecosystem.

The Arbitrum community recently finished its voting process for the Short Term Incentives Program (STIP), a community grants program that will distribute 50 million ARB tokens to whitelisted projects through the end of January 2024 (roughly a three month campaign). Projects requested funding through the Arbitrum Foundation forum and campaigned for community votes to receive their funding over a multi-week period.

A total of 30 projects received funding, but another 27 projects that successfully passed the voting threshold missed out due to the hard cap of 50 million ARB. This has already led multiple community members to call for reforms [1, 2] on how future incentives programs are distributed within the Arbitrum ecosystem. Collectively, the proposals from the projects that successfully received funding indicate that 63% of funds will be distributed as liquidity incentives, 32% will go to “active users” (defined as traders, borrowers, bridge users, quests, and competitions), and the final 5% is allocated by a small number of projects to partnerships. In the following discussion, we will value ARB incentives at the current market price of $0.89.

Liquidity Providers