Arbitrum DAO is voting on an $80 million DeFi Incentives Program (DRIP) to boost ecosystem activity through targeted rewards. Managed by a foundation committee, DRIP would distribute ARB tokens to users of approved protocols like GMX and Uniswap V3. The program includes a kill switch allowing DAO members to terminate it via vote.
The proposal aims to counter declining TVL (-18% YTD) and increased competition from Layer 2 rivals. Rewards would be distributed based on trading volumes, liquidity provision, and long-term staking. Critics argue the foundation’s control contradicts decentralization ideals and could lead to favoritism.
Voting ends June 20, with early sentiment leaning 60% in favor. If approved, DRIP could temporarily boost network metrics but risks creating artificial demand. The program’s success may influence Ethereum’s Layer 2 landscape ahead of Vitalik Buterin’s proposed ‘EIP-7738’ scaling upgrades.
