Arbitrum: token could skyrocket 50% with staking approval

The price of the ARB token, which powers the Arbitrum network, has been falling since the trend reversed following a mini bullish rally in March. However, the Decentralized Autonomous Organization (DAO) that runs the Layer 2 network has approved a staking proposal, which has given ARB a new boost.

As a result, the token has initiated a setup that could lead to a 50% bullish rally in the short term. The token’s price has declined over the past 24 hours, but this trend remains active.

Staking gains support on the platform

As reported by Todaysgist, Arbitrum’s DAO began the voting process on the proposal to enable ARB staking on Wednesday (14). This process was completed this Friday (16), with a total of more than 25,000 voters.

Of these, 91% voted to approve the proposal, which was proposed by Frisson, a delegate at Arbitrum, who published it on June 24. According to Frisson, the simple function of a governance token was not generating enough value for ARB, which motivated him to include staking on the network.

Upon approval, the network will discuss an on-chain proposal on Tally for $200,000 in funding to cover the cost of development. This will be a separate vote; if delegates approve, staking development will begin later this month.

Arbitrum ARB Analysis

ARB price started to rise on August 8 following the market-wide decline and is forming higher highs than the previous ones. If it continues on this path, ARB could break out of the descending wedge at a 51.48% rally and target the immediate resistance level around $0.8124.

According to Coinglass, over $1.276 million worth of buy limit orders between $0.52 and $0.53 have yet to be filled. This buy wall could support the price of Arbitrum, but if broken, it could signal weakness in the market, causing Arbitrum to drop to $0.49.

Furthermore, the Relative Strength Index (RSI) and Bollinger Bands suggest potential for a short-term bounce as Arbitrum price signals “oversold” conditions.

Other traders, however, believe that ARB remains in a strong downtrend with potential for further declines. However, the proximity of the support level and the oversold RSI could provide a short-term buying opportunity, giving new momentum to the rally.

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