One of the most highly-anticipated crypto projects of recent years was Arbitrum. This platform is designed to make working with Ethereum (ETH) quicker and cheaper and its native token, ARB, launched to some fanfare earlier this year.
Since then, things may not have gone quite as smoothly as some might have hoped for ARB.
On September 11 2023, following a notable sell-off, it sank to an all-time low. Investors will be hoping that its much-touted mainnet will arrive soon and will help boost the price.
In June, the confirmation that The Graph, an information protocol, was starting its transition to Arbitrum gave it something of a second wind. The news ame at a time when the overall crypto market was reeling from the news that the United States Securities and Exchange Commission (SEC) was suing the Binance and Coinbase crypto exchanges.
Arbitrum did not immediately respond to a request for comment.
But what is Arbitrum (ARB)? How does Arbitrum work? Let’s see what we can find out and also examine some of the Arbitrum price predictions that were being made as of September 12 2023.
Let’s examine some of the Arbitrum price predictions being made on September 12 2023. It is crucial to bear in mind that price forecasts, particularly for a potentially volatile asset like cryptocurrency, often turn out to be inaccurate. Additionally, please remember that many long-term crypto price predictions are generated using algorithms, which means they can change at any time.
First, CoinCodex made a short-term Arbitrum price prediction which said that things would get worse before they got better. It predicted the token would drop to $0.7152 on September 17 before recovering to $0.849 on October 12.
The site’s technical analysis was bearish, with 19 indicators sending discouraging signals compared to just six making bullish ones.
PricePrediction.net saw cautious growth, with it reaching an average of $1.36 this year. Bitnation was more cautious, saying it would get to about $1.17. DigitalCoinPrice , meanwhile, was supremely bullish in its ARB price prediction, saying it would shoot up to an average of $1.67 in 2023.
Moving on, DigitalCoinPrice and Bitnation’s Arbitrum price forecasts for 2025 were very close. The sites said the token would trade at $2.74 and $2.73, respectively. PricePrediction.net was a little more optimistic, claiming ARB would stand at $2.85 in two years time.
When it came to making a long-term Arbitrum price prediction, Bitnation argued the token could reach $6.63 in 2030. DigitalCoinPrice had it at $7.97. PricePrediction.net was even more optimistic, saying that it could trade at $19.77 at the start of the next decade.
It’s now time to cast our eyes over the, albeit short, Arbitrum price history . Although past performance should never be taken as an indicator of future results, knowing what the token has done in the few months that it has been on the open market can help give us some very useful context if we want to either interpret or make an Arbitrum price prediction.
When ARB first came onto the open market on 23 March 2023, it was worth $11.80. This price was quickly seen as a serious overvaluation and the price collapsed to $1.33, leaving its opening mark as its all-time high.
After that, the token experienced peaks and troughs, generally operating somewhere between $1.10 and $1.30, until the middle of April, when it shot up to reach a high of $1.73. Following that, the price fell down and, by early May, it was worth less than $1.10.
The price mainly operated between $1 and $1.10 until early June, when the fallout of the SEC’s lawsuits saw it fall below the dollar on its way to then-record low of $0.9142 on 15 June.
There was some recovery after that. The token went back past the dollar a few days after. On July 17, as the market grew after an American court ruled Ripple’s XRP crypto was not a security if it was being traded on exchanges, ARB hit $1.34.
The price of Arbitrum then dropped, and the fall became a crash in the middle of August. On 17 August the market tanked following the news that Elon Musk’s SpaceX had sold millions of dollars worth of Bitcoin (BTC) and ARB fell below the dollar.
Things got even worse over the following weeks. On September 11, it reached an all-time low of $0.7453. On following day, ARB was worth about $0.78.
At that time, there were 1.275 billion ARB in circulation out of a total supply of 10 billion. This gave the token a market cap of around $994 million, making it the 42nd-largest crypto by that metric.
It is perhaps a little too soon to tell. Arbitrum has been in a bad way lately, but it is always possible that things could turn around.
A lot will depend on any updates to the system’s mainnet proposals.
As always with crypto, you will have to do your own research before deciding whether or not to invest in ARB.
No one can really tell right now. While the forecasts are, on the whole, positive, remember that crypto price predictions have a well-earned reputation for being wrong. You should also understand that prices can, and do, go down as well as up.
Before you decide whether or not to invest in Arbitrum, you will have to do your own research, not only on ARB but on other, similar, tokens, such as Polygon (MATIC). Ultimately, though, this is a decision you will have to make for yourself. Just remember to never invest more money than you can afford to lose.
In its technical documentation, or whitepaper , Arbitrum says it aims to make Ethereum work better for developers.
It says: “Arbitrum is a protocol that makes Ethereum transactions faster and cheaper. Developers use Arbitrum to build user-friendly decentralized apps (dApps) that can take advantage of the scalability benefits of the Arbitrum Rollup and AnyTrust protocols.”
Although Ethereum is one of crypto’s biggest success stories, it has not been without its problems. One of the major issues which has caused people problems is how slow the system has been. The September 2022 transition to a Proof-of-Stake consensus mechanism was designed to deal with that. However, there are still concerns about the system still being slower than other networks.
As a result, the market for layer 2 scaling solutions, programs that take a transaction off a blockchain, carry it out, and put it back, has not gone away.
Arbitrum , which launched earlier this year, is just one of the many layer 2 scaling solutions out there. Its native token is ARB, which launched in March 2023.
New York-based software development company Offchain Labs created Arbitrum. Offchain is the brainchild of computer experts Steven Goldfelder, Ed Felten – former President Barack Obama’s deputy CTO – and Harry Kalodner.
Arbitrum uses something called optimistic rollups to take things off Ethereum and carry them out on the network. These programs work with smart contracts, computer programs that automatically execute when certain conditions are met, to help validate transactions.
The idea is that doing so helps the platform work quicker which, in turn, saves its users money. They assume that every transaction is valid and only verify them if a fraud-proof is submitted.
People who hold ARB are able to vote on proposals regarding the future of the Arbitrum network. Meanwhile, the crypto can be bought, sold, and traded on exchanges.
Because ARB is based on Ethereum, it is a token, rather than a coin. You might see references to such things as an Arbitrum coin price prediction, but these are, very often, wrong.
As of September 11 2023, there were 1.275 billion ARB in circulation out of a total supply of 10 billion.
It could do. PricePrediction.net says it will break past $10 in 2029. Meanwhile, DigitalCoinPrice sees it happening in 2031.
It is worth noting that ARB’s opening price was more than $10, but it fell from this mark within 24 hours of being released onto the open market.
ARB is the governance token for the Arbitrum layer 2 scaling solution. This means that holders can vote on changes to the network. People can also buy, sell, and trade in on exchanges.
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Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.