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Arbitrum (ARB) falls to all-time low as network usage metrics decline

– Arbitrum (ARB) tokens experienced a sharp decline of 14.5% between Sept. 9 and Sept. 11, marking its lowest point in history.
– Investors are questioning whether Arbitrum still possesses a competitive edge despite its significant total value locked (TVL) and notable activity.
– The absence of any instances of fraud proof issuance since the launch of the Arbitrum mainnet is a potential source of concern, although developers argue that this aligns with the intended operation of the system.
– Governance proposals, such as an allocation of ARB tokens from the project’s treasury and a staking mechanism, have also raised questions among investors.
– Liquidation risks on centralized and decentralized exchanges offering leveraged trading have also been a concern.
– Declining network activity, including a decrease in TVL and active addresses, indicates a loss of investor confidence and a decline in demand for the network.
– Competing chains, such as zkSync Era and Coinbase’s Base, may have contributed to Arbitrum’s decline.
– The combination of investor dissatisfaction with the governance mechanism and the network’s lackluster activity has led to Arbitrum’s price correction.
– Unless there is an upswing in transactions and an expansion of its user base, it is unlikely that ARB will be able to close the price performance gap with its competitors.

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