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Arbitrum DAO Greenlights $23.5 Million Boost for Ethereum Layer 2 Projects

In a significant move aimed at fortifying Ethereum’s Layer 2 network, the Arbitrum DAO recently made a pivotal decision, voting two-to-one in favor of disbursing a hefty sum of 21.1 million ARB tokens, equivalent to $23.5 million, into projects approved for grants from the network’s Short-Term Incentive Program (STIP).

This decision comes as a solution to rectify the shortfall faced by several projects that were initially greenlit but fell short of receiving their designated funds due to the STIP’s initial budget constraint of 50 million tokens.

With this latest vote, a total of 26 projects, in addition to the 29 previously funded ones, are set to benefit from this financial injection. Leading the pack is Gains Network (GNS), securing the lion’s share with 4.5 million tokens ($5 million). Following closely are Stargate Finance (STG) and Synapse (SYN), each earmarked to receive 2 million tokens ($2.2 million). Notably, Wormhole has been allocated 1.8 million tokens ($2 million).

The augmentation of the STIP’s budget to 71.1 million ARB tokens has sparked intrigue within the Ethereum community. As per the proposal’s guidelines, the additional funds are scheduled to be distributed after a brief three-day waiting period.

However, the decision wasn’t unanimous. Notably, some projects that were previously beneficiaries, including Camelot and MUX, stood among the one-third of voters who opposed the additional funding proposal.

Camelot, elucidating their dissent through an extensive comment, advocated for a different approach, pushing for a second round of proposals rather than a collective infusion of funds. On the other hand, MUX took a more succinct stance, emphasizing the importance of supporting proposals with robust protocol fundamentals, sound execution strategies, and reasonable grant sizes, signaling their reservations about the amalgamation of proposals with varying quality.

The Arbitrum DAO’s decision underscores the complexities inherent in governing decentralized systems and the diverse perspectives within the community regarding the allocation of resources and support for burgeoning projects. As the Ethereum ecosystem continues to evolve, the aftermath of this disbursement will likely shape the discourse surrounding funding mechanisms and project support within the Layer 2 network.

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