Arbitrum chooses to fund PancakeSwap and GMX while leaving out Lido

• Arbitrum chose GMX and PancakeSwap as part of the 29 approved recipients.
• ARB circulation increased while GMX and CAKE’s TVLs decreased.

Lido Finance [LDO] didn’t make the decision Arbitrums [ARB] latest financing round. In September, with a mission to compete in the Ethereum [ETH] L2 ecosystem, Arbitrum DAO revealed that it would support some DeFi projects operating on its chain.

Realistic or not, here it is ARB’s market capitalization in LDO terms

CAKE and GMX step in

According to 0xRamen, an analyst at Ouro Research, Arbitrum chose 29 projects for the grant based on the community’s voting results. Of the 49.6 million ARB tokens distributed, decentralized perpetual exchange GMX had the highest.

1/ @arbitrum Round 1 grant application has officially ended

Congratulations to the 29 projects that will collectively receive ARB 49.6 million

In the last few hours, the delegates passed by and all proposals reached the quorum pic.twitter.com/mu3MSYFiYM

— 0xRamen (@0xRamenUmai) October 13, 2023

In fact, it seemed that the Arbitrum community had a strong preference for perpetrator projects. This was because others such as MUX Protocol and Perennial Laba also received the support. While perpetrators accounted for 44% of the total funding, DEXs ranked second on the list as they received 15% of the funds.

Among the DEXes that made the list was PancakeSwap [CAKE]. A look at the mood snapshot it turned out that about 100 projects had applied for the grant. However, rejection in this round does not entirely mean that the projects that missed out are out of the race, as would likely be the case in another round.

Terms and conditions follow increases and decreases

Meanwhile, in the derivatives category, GMX has been able to maintain its lead over other offender platforms. According to Defi Llama, GMX’s Total Value Locked (TVL) at the time of writing was $447.33 million.

The TVL represents the amount of liquidity captured in smart contract protocols under an on-chain. However, it is worth noting that the GMX TVL decreased in the past 30 days. But with Arbitrum’s latest backing, it’s possible the value could increase. If this happens, it would imply that market players find the derived protocol more reliable than before.

Source: DeFi Lama

TVL from PancakeSwap too dropped within the same period as GMX. However, the only difference between the two was that the AMM was behind it Uniswap [UNI] And Curve Finance [CRV] in the rankings.

For Arbitrum, the approval of the funds had consequences for ARB circulation. According to Santiment, ARB single-day circulation rose to 136.5 million. Mintage shows the number of tokens/coins used within a certain period.

The increase therefore means that more ARB was used in transactions than on October 11.

How many Worth 1,10,100 ARBs today?

Source: Santiment

However, Arbitrum noted that the subsidy is only for the short term. Furthermore, the recipients should do this to hold their ARB tokens and create a Dune dashboard to report insights into project performance.

Additionally, a multi-sig wallet would be created to raise the money if a project was found to be violating the terms of the grant.