ARB, the native token of Arbitrum, a leading Ethereum layer 2 scaling solution, has seen strong support from large cryptocurrency holders, who have been buying and holding the token despite a recent market downturn. The launch of Chainlink CCIP and the introduction of a feature to protect against impermanent loss have also boosted the network’s appeal and performance.
Arbitrum has been attracting the attention and support of large cryptocurrency holders, commonly known as whales.
These whales have been accumulating ARB tokens, the native currency of the Arbitrum network, even after a recent price drop, indicating a bullish sentiment.
According to data from on-chain analyst Lookonchain, a prominent whale recently purchased 2.28 million ARB tokens, valued at approximately $1.86 million, through FalconX, a crypto trading platform.
These tokens were withdrawn from Binance, the world’s largest crypto exchange by volume, to FalconX on September 14 and subsequently transferred to another address.
The estimated average acquisition price for the whale stands at around $0.81.
ARB Price Recovers After a Dip
ARB experienced a decline to $0.74 on September 11, partly influenced by the broader crypto market’s downward trend, which also saw Bitcoin drop below $25,000.
However, the token rebounded, with buyers showing interest at around $0.87 before stabilizing near $0.82.
The current market capitalization of ARB is over $1 billion, ranking it among the top 50 cryptocurrencies by market cap.
Arbitrum Launches Chainlink CCIP and Other Features
Arbitrum’s price recovery and whale accumulation may also be attributed to the network’s recent developments and innovations.
On September 13, Arbitrum announced the launch of the Chainlink Cross-Chain Interoperability Protocol (CCIP) mainnet on its Arbitrum One chain.
This development is expected to enhance the ARB ecosystem by improving user experiences and attracting more developers.
The CCIP is a protocol that enables cross-chain communication between different blockchains, such as Ethereum and Arbitrum. This allows users to access data and services from multiple networks without leaving their preferred platform.
For example, users can leverage Chainlink’s decentralized oracle network to obtain real-world data and feed it into smart contracts on Arbitrum.
Another feature that Arbitrum has introduced is the ability to protect against “Impermanent Loss,” a critical risk management tool that benefits large-scale traders and investors.
Impermanent loss occurs when the value of the assets in a liquidity pool diverges from their original value due to price fluctuations. This can result in losses for liquidity providers who withdraw their funds from the pool.
Arbitrum has implemented a mechanism that allows users to hedge against impermanent loss by locking their liquidity tokens in a smart contract that pays out a fixed amount of ARB at a future date.
This way, users can secure their profits and avoid losses due to market volatility.
