Arbitrum has managed to maintain its place amongst the top names in decentralized finance (DeFi) despite the unfavorable conditions gripping the space in 2023. However, the price of ARB (the network’s native token), met with a euphoric welcome in March, has been struggling.
The Arbitrum token’s price tumbled to a new historical low of $0.747217 on Monday, the 11th of September, with its honeymoon phase seemingly over. The token’s value dipped by more than 12% in the past week, leaving investors wondering what could be behind this bearish movement.
Whales Part With Millions Of ARB Token In Selling Spree
ARB’s latest price downturn has been associated with the increased market activity of Arbitrum whales in the past few days. On Monday, crypto journalist Colin Wu reported that three whales transferred 10.23 million ARB (worth about $8 million) to Binance.
The first whale reportedly sold 3.8 million ARB at $0.77 per token, while the second whale – with the pseudonym vladilena2.eth – sold 3.63 million ARB at $0.83 per token. Meanwhile, the third whale moved 2.8 million ARB for $0.79 per token.
This seeming loss of interest from whales may have precipitated the downward pressure that pushed Arbitrum to a new all-time low. Unfortunately, there appears to be no end, as whales have continued to dump their ARB tokens in the last few hours.
According to a Lookonchain report, seven whales have dumped 20.41 million ARB tokens (valued at about $16.05 million) in the last 30 hours. The blockchain analytics platform revealed that these whales generated a total loss of $8.15 million.
It is worth noting that general market sentiment may have also contributed to ARB’s price performance. As of this writing, the Arbitrum native token is valued at $0.781039, according to CoinGecko data.
Other Possible Reasons For Arbitrum Price Decline
Another plausible reason for ARB’s recent price downturn is the dwindling activity on the Arbitrum network. While the chain continues to hold its own as a prominent L2 network, it has been experiencing a steady decline in total value locked (TVL).
According to DefiLlama data, Arbitrum has a total value of $1.65 billion in assets locked on its network, reflecting a more than 35% decline in the past four months. This current figure also represents the network’s lowest TVL since March.
The sustained decrease in total value locked suggests a loss of investor confidence, which could discourage…