Arbitrum, a prominent layer 2 scaling solution for Ethereum, has experienced a notable surge in Total Value Locked (TVL) following the introduction of its Short Term Incentive Program (STIP). Launched with the intention of distributing 50 million $ARB to Dapps within the ecosystem, the program aims to catalyze network and ecosystem growth, with all incentives set to be distributed by January 31, 2024.

Lucas Outumuro, Head of Research at intotheblock, shared insights indicating positive outcomes from Arbitrum’s $ARB incentive initiative. Of course, early results showcase a 26% increase in TVL and a substantial 27% rise in new users since the program’s debut. Impressively, certain protocols leveraging the incentives have yielded a remarkable 50x return on investment.

Among the standout performers, @GMX_IO demonstrated the most significant TVL gain in terms of dollars, amounting to around $100 million. Meanwhile, @AngleProtocol exhibited the highest percentage increase in TVL, soaring by an impressive 5,900%.

Also, on the flip side, Kyber experienced a decrease of -$17 million, marking a substantial 99% decline since its exploitation.

One noteworthy metric highlighting the program’s impact is the surge in the number of new addresses completing their first transaction on Arbitrum, witnessing a substantial 27% rise compared to pre-STIP levels.

Despite being in the early stages of implementation, the Arbitrum STIP has proven effective in driving crucial measures upward. Protocols utilizing $ARB incentives have demonstrated the ability to bootstrap TVL and revenue at an accelerated pace.

Finally, As the program progresses towards its conclusion, a more comprehensive evaluation of its overall impact and sustainability will provide a clearer understanding of its significance within the Arbitrum ecosystem.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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