Arbitrum DAO Discusses Creating a $3.3 Million Memecoin Fund
In a recent proposal on the Arbitrum DAO forum, user 0xkawz suggested the creation of a memecoin fund to support and cultivate a memecoin-friendly culture within the Arbitrum ecosystem. The proposal, which was developed in about an hour, aims to attract new liquidity, users, and attention to the blockchain.
The motivation behind the proposed fund is to help the Arbitrum ecosystem as a whole by drawing attention, new users, more chain usage, more DeFi activity, and more. While Arbitrum has the highest TVL among all L2s, daily active users (DAUs) are stagnating, and protocols are having a hard time attracting new users.
The proposed memecoin fund structure includes five board members and three collaborators who run the day-to-day activities and decisions. The fund would be managed through a 5/9 multi-sig, and collaborators and board members would not be allowed to invest in tokens funded by the initiative.
Criteria for initial review of memecoins include fair launches, secure contracts, high holder count, low concentration of whale holdings, sufficient liquidity provisioning, and a minimum market capitalization of $1 million USD. The fund would invest between $50K to $150K USD in selected projects and offer dedicated graphic designers and video renderers to support the projects.
The proposed timeline suggests implementing the fund as soon as possible, with a propagation period of at least six months. After this period, the Arbitrum DAO can vote to increase funding or terminate the memecoin fund entirely. Any unwound assets would be converted to $ARB and sent back to the Arbitrum DAO if the fund is dissolved.
The overall cost of the proposed memecoin fund is estimated at $3,315,000 USD worth of $ARB, which includes monthly compensation for board members, collaborators, and graphic designers, as well as an initial 6-month allocation of $3 million USD worth of $ARB to kickstart the fund.
The proposal also suggests considering additional funding of $1-2 million worth of $ARB, which would be reserved as grants to Arbitrum DeFi protocols that incorporate funded memecoins into their product offerings. This aims to bridge the memecoin and DeFi landscapes within the Arbitrum ecosystem.
While most users expressed support for the proposal, some, like NicoDeva, found it "cringe and lame," viewing it as a request for the foundation to inject money into failing memecoins. Despite this, the majority of the community appears to be in favor of the initiative, believing it will contribute greatly to Arbitrum's ecosystem and attract attention and cash flow, as seen with the success of $BONK on Solana.
