ARB: price and mechanics.

Arbitrum is an optimistic rollup: transactions are processed off Ethereum and written back to the mainnet in bundled form. That significantly lowers per-transaction costs compared to trading directly on Ethereum, while final security still comes from Ethereum itself.

The network ranks among the largest Layer 2s by total value locked and active applications, hosting a broad range of DeFi protocols, lending platforms and decentralised exchanges.

Transactions on Arbitrum are paid in ether, not ARB. ARB isn't a gas token; it serves a different, more specific purpose within the network.

ARB is primarily a governance token: holders can vote on proposals at the Arbitrum DAO, such as treasury spending, protocol changes and developer grants.

A portion of ARB supply went to the team and investors at launch, under a multi-year vesting schedule. That means new tokens periodically unlock, which can create potential selling pressure that investors typically watch.

Governance via ARB has sparked debate in practice, including over how much influence the founding foundation has versus regular token holders on key decisions.

Arbitrum competes with other Layer 2s like Base and Optimism for the same developers and liquidity. If activity shifts to competing networks, that can feed through into demand for ARB and revenue managed by the DAO's treasury.

The ongoing token unlocks for team and investors can create sustained selling pressure, independent of the network's technical performance.

As with all Layer 2s, some trust remains necessary in the parties operating the rollup infrastructure, even though final security rests with Ethereum.