Arbitrum Community Considers $3.3 Million Memecoin Fund

Members of the Arbitrum DAO have been invited to discuss the creation of a $3.3 million ARB fund for investments in memecoins.

If the initiative receives strong support, it will be put to a vote.

“The motivation […] — to help the Arbitrum ecosystem as a whole. To attract attention, new users, increase network usage, and boost DeFi activity among other things,” commented the proposal’s author.

The proposal was put forward as an alternative to the allocation of 37 million ARB for supporting decentralized finance protocols.

Didn’t realize but apparently arbitrum dao is about to give another ~37M arb to defi protocols again.

Instead of trying something different, we’re just going to throw more money at protocols so they can be farmed by whales/teams.

Nothing was learned from the first round.

Stop… https://t.co/XfkDLRVRxP pic.twitter.com/UBUR7J8n7c

— 0xKawz (@0xKawz) March 23, 2024

“The first round taught us nothing. Stop focusing on DeFi. Focus on attracting new participants who will inevitably use them,” he explained.

The proposal outlines a governance structure. It is expected to consist of five board members and three staff, operating under a multi-signature scheme requiring five out of nine confirmations. 

The initiative proposes a ban on investments in tokens supported by the fund for the specified individuals.

The proposal defines criteria for selecting memecoins, including secure contracts, broad holder distribution, minimal whale participation, sufficient liquidity, and a minimum capitalization of $1 million.

Funding of $3.3 million covers various expenses, including monthly compensation for board members, staff, and designers. 

Of this amount, $3 million in ARB will be directly allocated to achieving the fund’s primary goals over the first six months.

The initiative envisions a swift launch of the structure, followed by a six-month promotion period. 

At the end of this period, an evaluation of the results is planned. Arbitrum DAO participants will vote on whether to increase funding or completely dissolve the fund. In the event of dissolution, assets will be converted into ARB and returned to the treasury.

According to L2BEAT, Arbitrum is the largest Ethereum-based L2 network with a market share of 43.9%. The project’s TVL stands at $16.8 billion. Its closest competitor, OP Mainnet, has a figure half as large ($8.3 billion).

On March 15, the Avalanche Foundation acquired five memecoins, including Coq Inu, Gecko, Kimbo, NoChill, and Tech, for an undisclosed amount as part of the Culture Catalyst program to promote broader blockchain adoption.

In the Base community, further growth of TVL in the L2 network is considered possible due to a wave of memecoins. It is expected to draw some interest away from assets issued on Solana.