ARB’s price has hit a new low due to a decline in total value locked (TVL), a decrease in active addresses engaging with its DApps, and a general downturn in the crypto market.
Arbitrum is a leading contender in Ethereum’s layer-2 scalability solutions, but its token price experienced a sharp decline of 14.5% between Sept. 9 and Sept. 11.
Investors are questioning whether Arbitrum still has a competitive edge, despite its TVL exceeding $1.6 billion.
One potential concern is the absence of fraud proof issuance since the launch of the Arbitrum mainnet, but this is unlikely to have significantly impacted the price.
Governance proposals from Arbitrum’s DAO, including token allocations and staking mechanisms, have also raised questions among investors.
There are concerns about liquidation risks on both centralized and decentralized exchanges that offer leveraged trading.
The decline in ARB’s price may be attributed to declining network activity and a decrease in demand for the network.
Competing chains such as zkSync Era and Coinbase’s Base may have contributed to the decline.
Unless there is an increase in transactions and user base, it is unlikely that ARB will be able to close the price performance gap with its competitors.
