How To Invest In Arbitrum?
Crypto Knowledge

How To Invest In Arbitrum?

written by John Murphy | February 15, 2023

Arbitrum is regarded as the next-generation layer 2 of Ethereum by numerous cryptocurrency enthusiasts. Arbitrum is one of the largest development in the Ethereum ecosystem; thus, growth potential has left many investors searching for – how to invest in Arbitrum.

Furthermore, its growth is steady and substantial and shows no signs of slowing down. Similarly, liquidity is abundant, while the crypto market cap is also positive; thus, Arbitrum’s platform infrastructure is building daily. 

Thus, the Arbitrum universe is expanding, and opportunities are abundant for residents of Arbitnaus, so all you need is to look for our growth-potential avenues and hit the jack pack. 

Although Arbitrum still does not have any native token, investors can benefit by investing in GMX and DPX. So, taking an early bird advantage is up for grabs as, eventually, Arbitrum will release its token. 

Therefore, let us further explore how to invest in Arbitrum.

Investing in Arbitrum

Nitro update has already made headlines, and now it’s time for Arbitrum to further poise experience, growth and liquidity by improving transaction speed and lowering fees.

The idea is to improve transaction capacity and help fuel the trend. Since it is still an infant, thus the first phase is to launch Arbitrum Odyssey, an event to encourage and involve users to use the application. While in the second phase, they plan to launch the Arbitrum token.

Despite no signs of tokens, the Arbitrum has bootstrapped organically. Despite having no incentives, Arbitrum has become the largest L2 by TVL, with more than $2.58B. At the same time, the token launch will further fuel the price and value of the coin.    

So, how can one become part of the Arbitrum ecosystem?

Here’s how

  • Arbitrum Native Projects

The straightforward way to become part of the Arbitrum ecosystem is to invest in its native projects that are either rolled out or under development phases.

In addition, these early adopters are likely beneficiaries of inflow into Arbitrum once main projects are launched, as it will increase growth in revenues, users, investors, TVL and other primary KPIs.

There are multiple native projects where investors can trade and benefit from tailor-to-fit portfolio composition and risk profiles.

Let us touch on a few ones below.

  • GMX (GMX)

GMX is a DeFi perpetual exchange, the largest protocol that uses a liquidity pool model. Traders buy a basket of assets known as GLP by opening borrowing positions. GLPs are the counterparties for traders, as they take their P&L risks while accruing fees. 

The network has generated $10.36M in protocol revenue during the last six months. Thus, GMX appears as the core of the Arbitrum primitive projects. 

  • TVL – $282M
  • Market Cap – $376M
  • FDV – $623M
  • Dopex (DPX)

DPX is an advanced-level protocol that uses options trading. It offers a suite of products ranging from SSOVs (Single-Sided Options Vaults). Investors can easily run call and cash-secured put strategies.

The first implementation of Atlantic Options (AOs) is the Straddles, a platform where users can borrow the collateral locked in an options contract.

  • TVL – $29.15M
  • Market Cap – $85M
  • FDV – $209M
  • Mycelium (MYC)

Formerly called Tracer DAO, Mycelium is a building suite for derivatives on the Arbitrum. The best example of these types of trading is a leveraged ETF, where investors can hedge a risk exposure to a given asset.

MYC has also recently launched Perpetual Swaps, where traders can provide liquidity via the MPL Pool.

  • TVL – $16.7M 
  • Market Cap – $36M
  • FDV – $60M
  • Cross-Chain Infrastructure

Another way to become part of the Arbitrum is by investing in “picks and shovels’. The straightforward pick and shovel play are messaging and bridge protocols. Although security fears are circulating the platform, these systems remain critical parts of the Arbitrum infrastructure.

Moreover, users can easily transfer across the network with a 7-day withdrawal facility. However, investors may enjoy the same features through investment in cross-chain infrastructure, but it still makes a good option to explore DApps on Arbitrum.

The following are interoperability solution tokens to test for the Arbitrum.

  • Synapse (SYN)
  • Hop (HOP)
  • Stargate (STG)
  • Airdrop Farming

Airdrop farming is another route to reach the Arbitrum ecosystem. While Stargate, Hop and Synapse are tokens, a few other projects will issue tokens and increase community.

Since you do not directly purchase tokens in airdrop farming, thus, it is the best risk-aversion strategy.

Frequently Asked Questions

How can I sell Arbitrum?

Currently, Arbitrum is sold through a process known as the Dutch auction process. In this type, the token price starts high and gradually declines. The positive for buyers is that they can purchase tokens at a lower price if they are patient.

What are the pros of the Arbitrum?

Arbitrum offers several advantages to its users, and a few are given below.

  • Highly scalable design
  • High security and transparency
  • Fast and efficient transactions
  • Intuitive interface

What is the Arbitrum?

Arbitrum is a digital asset that makes online payments fast, secure, trustworthy and scalable.

Why invest in Arbitrum?

DApps face several challenges, including high costs, slow speeds and scalability issues. However, Arbitrum easily swipes away these problems; thus, users prefer it for making payments. Thus, its value is increasing, becoming a cash cow for investors.

What profits can I make from the Arbitrum?

You can make profits by trading the Arbitrum tokens. However, profits from the Arbitrum depend on several factors, a few of which are listed below. you

  • Total ticket supply
  • The demand for the tokens

Parting Thoughts

Arbitrum is turning out as a good investment choice. Although they are yet to launch their native token, investors are chasing it and tipping it to perform well in the long term, just like Bitcoin or Ethereum.

Since the platform provides several unique features, thus making it is an appealing investment opportunity for those interested in exploring the cryptocurrency market.

Furthermore, the team behind Arbitrum is fully dedicated and ensures the projects are successful. Based on trends, it looks as if Arbitrum’s value will keep on rising in the future.

However, we always suggest seeking professional advice before investing in cryptos because the crypto market is highly volatile.

We hope we have satisfied your query “how to invest in Arbitrum” through this article. Please leave feedback and let us know if you have invested or considering investing in the Arbitrum.