Arbitrum Shakes the Layer-2 Space, Finally Releasing $ARB
The Layer 2 network to decentralize and hand government to the community
GM, frens! Ambire here with out weekly newsletter, today we'll be talking about Arbitrum's looooong awaited $ARB token release, troubles with fiat-crypto ramps in UK, GPT-4 release, Shibarium devs being accused of "forking" the code and something called "on chain finance". Let's go!
Arbitrum releases $ARB on March 23
The long-awaited moment has finally arrived, as Arbitrum is finally releasing its token, ARB. This highly anticipated event is set to govern the entire Arbitrum ecosystem and will be distributed through an airdrop to early users. But there's more. Arbitrum is also introducing a new framework, Arbitrum Orbit, which allows for the creation of L3s that can settle to Arbitrum-based rollups.
A quick summary of what we know so far about ARB: ARB will be used to participate in the Arbitrum DAO, which will govern the entire ecosystem, including Arbitrum One (the "main" L2) and Arbitrum Nova. One unique feature of Arbitrum is that it will be the first L2 to have "self-executing governance," meaning that governance will take place entirely on-chain, and proposals do not need to be implemented manually by the core team. Arbitrum is also creating an "Arbitrum Security Council" made up of a 9/12 multi-sig, which will have the authority to make changes to the rollup in the event of a security emergency.
Additionally, token holders will have control over Arbitrum IP rights, and DAO governance will have the ability to approve the creation of other L2s that settle to Ethereum and are built using Arbitrum's technology. These L2s can be governed by ARB holders (a governed chain), or have their own independent governance system (an ungoverned chain). It's important to note that DAO governance doesn't need to approve the creation of L3s that settle to Arbitrum itself.
It's also worth mentioning that there will be an ARB airdrop for early participants within the ecosystem, and the token is scheduled to go live on March 23. The airdrop will distribute 11.62% of the total 10 billion token supply to individual user wallets, while the majority will go to the DAO treasury (around 43%), with roughly 27% reserved for the team, and 17.5% going to the project's investors. The remaining 1% will be allocated to DAOs in the Arbitrum ecosystem.
It all looks well planned by the Arbitrum team, however we can't help but wonder why they had to release the following video masterpiece of cringe to mark the event.... (We saw it, so you'll have to as well, sorry 🤷♂️)
UK's crypto banking troubles
One of the largest UK banks has decided to join the movement for “increasing customer protection against crypto criminals.” But, don’t expect any real help. Rather than actually taking any real steps to protect their customers from fraud, NatWest has decided to limit payments to £1,000 a day and £5,000 a month.
According to them, 329 million British pounds were lost by consumers last year to cybercrime and scams, so that's why you can't be trusted with your own money. And just like NatWest, other banks like HSBC, Nationwide, and Santander have all followed suit in placing similar restrictions on crypto investors.
NatWest (UK bank) puts a limit to no more than £5k. a month trasnfer to Crypto exchange 🙌🏻 I guess I will be changing the bank very soon. Although I like the comments 😂😂 especially from people who have never heard of #crypto but quick to call it a scam 😂
— Hexigirl_ (@Cryptogirlzzzz)
Mar 14, 2023
Additionally, Binance has announced that it will be halting withdrawals and deposits for its local users in the UK starting from May. Apparently, even though Binance has been trying to legally enter the UK market for years, helping consult law enforcement and other government agencies, as well as making sure its platform is compliant with AML and CFT regulations, it still wasn't enough. It's clear that crypto investors in the UK are facing an uphill battle as regulators and banks clamp down on their ability to trade.
GPT-4 release stirs up the space
AI tokens are pumping as the space is stoked by OpenAI’s GPT-4 release. The new version of the software allegedly can process 1,000 times more information and has improved search capabilities which now accept images and video along with text input.
I just watched GPT-4 turn a hand-drawn sketch into a functional website.
This is insane.
— Rowan Cheung (@rowancheung)
Mar 14, 2023
The data from CoinGecko shows AI gains were far higher than the rest of the market. SingularityNET's AGIX experienced an incredible surge of 25% in a single night, and others such as Fetch.ai (FET), Ocean Protocol (OCEAN) and Numeraire (NMR) gained a double digit percentage increase in value.
I gave GPT-4 a budget of $100 and told it to make as much money as possible.
I'm acting as its human liaison, buying anything it says to.
Do you think it'll be able to make smart investments and build an online business?
Follow along 👀
— Jackson Greathouse Fall (@jacksonfall)
Mar 15, 2023
Funnily enough though, 'Smart Money' tab from Nansen chain analytics website shows that big investors weren't interested at all in the tokens and didn't participate in the rally. This implies that the recent AI token pump is more hype-driven than anything else – meaning that the gains will be short-lived, as a sustainable rise in a token’s price is usually built upon accumulation by big investors and institutions.
Shibarium devs accused of copy pasting code
The SHIB community is abuzz with rumors that the developers of Shibarium may have resorted to copy-and-pasting code from another blockchain. After the beta version of Shibarium was released a few days ago and more technical details such as the Chain ID, RPC nodes, block explorer, faucet, and bridge were released yesterday, one of the SHIB community members on Discord noticed that the Chain ID, 917, was the same as that of a blockchain project called Rinia, launched December last year.
The user pointed out that the Chain ID would be an absolute unique identifier that differentiates one blockchain from another, and MetaMask and other wallet applications will use this to determine which network to send transactions to. As such, it is considered highly unlikely that two projects would have the same chain ID by sheer coincidence.
So the question has been raised, did Shibarium developers resort to copy-and-pasting code from Rinia?
Dispelling some FUD ever since we did the Alpha network deployment few chain IDs were picked randomly- 417(Alpha), 517(Staging), 917(pre-pod/beta) and these chain were not registered anywhere at that time, I made a mistake to not recheck when the puppynet network was launched
— ShibDev4Evr (@kaaldhairya)
Mar 16, 2023
According to devs the number was just a random choice and that no code was copied from Rinia. Furthermore, they explained that the chain will be relaunched with a different chain ID and it will have its own unique identifier. This has served to quell some of the FUD spread in the SHIB community, but the mystery behind Shibarium's chain ID still remains.
Research corner: Reimagining DeFi - from "fiat killers" to "on-chain finance"
The recent events involving SVB have laid bare the fragility of decentralized finance networks and how their components interact with one another. According to some experts, USDC’s depegging from the U.S. dollar was a wake-up call for the industry, as it exposed the risk of relying on centralized services and their ability to affect the value of a stablecoin.
Here's for example an opinion from Ignas, a DeFi researcher:
1/ The USDC depeg has sent shockwaves through #DeFi, calling into question its very foundation.
Where do we go from here?
There are two possible paths forward: 🧵
— Ignas | DeFi Research (@DefiIgnas)
Mar 15, 2023
According to him, the banking system, government and other third-party providers remain major points of failure for DeFi networks. While USDC is seen as one of the safest collaterals for DeFi, its stability rests on trust in traditional financial institutions and their reserves. In addition to this, many DeFi products are built on Ethereum-based infrastructure which is vulnerable to censorship or other manipulations by governments. This means that while DeFi networks may offer higher yields and more customization options compared to traditional finance, they are also more liable to external events and can be shut down at any time if desired.
He proposes that instead of referring to DeFi as a disruptive technology, it should be rebranded as something he calls "on-chain finance". The purpose of this rebranding would be to emphasize the fact that it is a form of finance based on cryptography, with all transactions taking place on a blockchain, but which still relies on the same external factors as traditional finance. By doing so, it retains all the key benefits of DeFi such as self-custody wallets but reduces reliance on third-party custodians, exchanges, and gateways.
He argues that this will help bring more security and transparency to DeFi networks, making them less vulnerable to shocks from external factors. But it will not remain decentralized in its purest form, as it will be subject to some (in reality - total) degree of control from governments or other centralized entities. So in a way, he's saying that DeFi as you know it is not really possible anymore, but it can be reimagined as a more secure and transparent form of finance. Financial media have often likened crypto to the Wild West, yet like frontier outlaws that gradually disappeared, it appears DeFi is slowly being reined in.
The fun page: our weekly meme collection
the libertarianism leaving VC’s bodies when their banks default
— parker lyons (@tweetsbyparker)
Mar 11, 2023
That's all for now, frens.
We'll see you next week. And remember, the market conditions are temporary, but our commitment to building a better DeFi is here to stay. Thanks for joining us and we look forward to seeing you back next week. Cheers!
Yours, The 🔥 Team
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