The Arbitrum DAO (decentralized autonomous organization) has approved a governance proposal that enables ARB staking for token holders.
With around 66% of the votes in favor, the proposal was finalized by the Arbitrum community governance on November 6. It will enable ARB holders to stake their holdings and get yields in rewards from the Arbitrum treasury.
33% voted against the proposal, highlighting a disagreement within the community regarding the use of treasury funds for staking incentives.
The proposal sought to allocate 1% to 1.75% from the DAO Treasury with options of 1%, 1.25%, 1.5%, or 1.75%, out of which the community opted for 1% or 100 million ARB in staking rewards. A significant vote also disagreed with the proposal and asked to not use tokens for this staking program.
Unlike other staking mechanisms which reward stakers with genesis tokens, Arbitrum will provide staking yields from the DAO treasury. The staking APY (annual percentage yield) will depend on the staked ARB which is estimated between from the base of 7.8% to over 78% during the 12-month period.
The ARB token currently does not hold any utility value in the Arbitrum ecosystem, while this proposal aims to unlock a potential value from the token economy. The DAO is set to consider a subsequent proposal that will focus on the specifics of the staking implementation.