Question 1

What is ARB, and what rights does it give holders?

Accepted Answer

ARB is the ERC-20 governance token of ArbitrumDAO, and its canonical token contract is on Arbitrum One. It gives holders voting rights in the DAO’s onchain governance, which can affect upgrades to the chains governed by the DAO, use of treasury funds, and matters concerning the Security Council; it does not represent an automatic right to distributions of Arbitrum network fee revenue. “Canonical” means that the ARB contract on Arbitrum One is the canonical contract for the token; it does not mean ARB is the native Gas asset required for transactions on that chain. The token can be bridged to networks such as Ethereum, but its representation after bridging does not change its basic role as a governance token.

Question 2

Is ARB the Gas token for Arbitrum One?

Accepted Answer

On Arbitrum One and Arbitrum Nova, everyday transaction fees are paid in ETH, not ARB; therefore, ETH is needed as Gas when using these two chains to transfer funds, call contracts, or deploy applications. Holding ARB does not replace ETH for paying fees. Fees have two components: the L2 execution cost and the L1 cost associated with posting transaction data to Ethereum. The former can change with factors such as onchain congestion, while the latter is affected by Ethereum data-posting costs; therefore, ARB’s governance function and the ETH network fees users actually pay are two separate mechanisms. Some self-deployed Arbitrum chains may use a custom Gas token, but this does not change the fact that Arbitrum One and Nova use ETH.

Question 3

How can I participate in governance after holding ARB, and what does delegation mean?

Accepted Answer

ARB voting power is calculated by token quantity; holders can delegate to their own address and vote directly, or delegate voting power to another address. Delegation transfers voting representation in governance, not token ownership to the delegate. The DAO separates “holding tokens” from “continually researching proposals and voting on behalf of others”: people who do not want to participate item by item can delegate to a representative, and that representative receives voting power corresponding to the ARB they represent. Holding any amount of ARB is sufficient to participate in governance voting or delegation; however, an address submitting an onchain proposal must be able to represent voting power for at least 1 million tokens, to reduce spam proposal risk.

Question 4

How does an ArbitrumDAO proposal actually take effect?

Accepted Answer

A standard Arbitrum proposal does not execute immediately once submitted: it generally first undergoes at least 7 days of public discussion on the governance forum, followed by a one-week offchain temperature check; only after receiving sufficient support can it be submitted for an onchain vote. After passing onchain, it must also go through a delay before the onchain actions prewritten in the proposal are executed. Constitutional AIPs are used to amend the Constitution or AIP-1, install or modify onchain software, and conduct operations requiring chain-owner permissions; non-Constitutional AIPs include funding, general guidance, and other matters. Both proposal types require more votes for than against and must meet a quorum based on delegated voting power: 50% for Constitutional proposals, with the threshold bounded between 150 million and 450 million ARB; and 40% for non-Constitutional proposals, bounded between 100 million and 300 million ARB. The temperature check, onchain vote, and final execution are separate stages; offchain support alone does not modify the chain or transfer treasury assets.

Question 5

What role does the Security Council play in ARB governance?

Accepted Answer

The Security Council is a 12-member multisignature body and a security backstop outside regular DAO governance; its powers come from authorization by the DAO and Foundation, rather than permanent control independent of the DAO. The DAO can amend or revoke these powers through a Constitutional AIP. In a genuine security emergency that seriously endangers the integrity, confidentiality, or availability of the chains it governs, the Security Council can execute an upgrade or other necessary actions without waiting for the standard proposal process, but at least 9 of 12 members must agree and a transparency report must be published when appropriate. Routine maintenance, standard upgrades, and parameter adjustments can also follow its non-emergency path, which likewise requires 9/12 approval, skips the preliminary stages of a standard AIP, and retains a deployment delay. Thus, this mechanism addresses risks that ordinary public governance cannot handle in time, rather than making every upgrade an immediate decision.

Question 6

What are ARB’s supply cap and initial allocation?

Accepted Answer

ARB had an initial supply of 10 billion tokens. Additional supply is not issued automatically under a predetermined program: the DAO can mint new ARB only through a Constitutional proposal, and may increase supply by no more than 2% of the supply then in existence each year; the first date such minting could occur was March 15, 2024. The main destinations of the initial supply included 3.528 billion tokens for the DAO treasury, 2.694 billion for the team and contributors, 1.753 billion for investors, 1.162 billion for the user airdrop, 750 million for the Foundation, and 113 million for airdrops to DAOs on Arbitrum. The initial total, the amount unlocked, and the amount immediately transferable in the market are not the same concept: whether treasury tokens count as circulating also depends on whether the DAO later deploys or distributes them through governance.

Question 7

How does ARB’s unlock mechanism affect the understanding of “circulating supply”?

Accepted Answer

To understand ARB’s tradable supply, it is not enough to look only at the 10 billion initial total; the unlock rules for allocation recipients and whether the treasury has actually deployed tokens must also be considered. Tokens for the team, contributors, and investors follow a four-year schedule from March 16, 2023: the first unlock occurred one year later on March 16, 2024, followed by monthly unlocks over the remaining three years. The Foundation allocation uses a different schedule: lockup began on April 17, 2023, with linear unlocking over four years. An unlock means tokens are no longer subject to that vesting restriction; it does not mean they have been sold, transferred to a trading venue, or will necessarily increase actual market sell pressure at a particular time. Whether tokens in the DAO treasury enter circulation also depends on deployment through governance proposals.

Question 8

Where did unclaimed tokens go after the ARB airdrop ended?

Accepted Answer

ARB user and DAO airdrops became available on March 23, 2023; the claim window ended at Ethereum L1 block 18,208,000 (September 24, 2023), and unclaimed ARB was transferred to the ArbitrumDAO treasury. Therefore, the airdrop was not an activity that could be claimed continuously, and unclaimed tokens did not automatically return to the wallets that were originally eligible. This distribution event changed token ownership: claimed tokens are controlled by the claiming addresses, while unclaimed tokens entered the DAO treasury, whose subsequent use must follow the DAO’s governance and treasury decisions. It was not a new issuance, and it cannot be used to infer the current real-time amount available for sale for a particular address or for the market as a whole.

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