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Arbitrum (ARB) at Risk: Assessing the Fallout from Curve Finance Hack

3 mins
Updated by Ryan James
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In Brief

  • Over the past week, Arbitrum (ARB) has consolidated within the $1.18 - $1.20 territory, but Curve Finance now warns of a potential exploit on Arbitrum’s tricrypto liquidity pool.
  • $113 million invested in the second-half July by the whales could be at risk if the exploit spreads over to the Arbitrum network.
  • On-chain Mean Coin Age data shows that Arbitrum long-term holders are not yet showing any signs of panic.
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Arbitrum (ARB) price has consolidated within the $1.18 – $1.20 territory over the past week. But Curve Finance now warns of a potential exploit on Arbitrum’s tricrypto liquidity pool. How will ARB investors react? 

On July 30, popular DeFi lending platform Curve Finance suffered a $50 million hack after a malicious actor executed a reentrancy attack on a number of liquidity pools. 

After investigations, the Curve Finance team has warned of a potential exploit on Arbitrum’s tricrypto liquidity pool. While developers have not yet identified a profitable exploit on this Arbitrum LP, Curve’s team advised users to withdraw funds to avoid possible losses.

On-chain data analysis examines the early reactions of Arbitrum investors to this warning and the potential price impact. 

Long-Term Investors Are Still Holding Firm Despite Curve Finance Warning 

According to on-chain data from Santiment, Arbitrum long-term investors are not yet showing any signs of panic. The chart below shows that the ARB Mean Coin Age has continued to trend upwards since Monday, July 31.

Remarkably, between July 16 and July 31, ARB Mean Coin Age increased by 28% from 166.82 to 213.62.

How will Arbitrum (ARB) Investors React? | Mean Coin Age, July 2023
How will Arbitrum (ARB) Investors React? | Mean Coin Age, July 2023. Source: Santiment

Mean Coin Age evaluates changes in the trading patterns of long-term investors. It is computed by dividing the number of days each coin has spent in their current wallet addresses by the total number of coins in circulation.

This steady rise in Arbitrum Mean Coin Age indicates that long-term investors are still holding firm and consolidating their positions despite the recent exploit scare. 

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Arbitrum (ARB) Price Prediction 2023/2025/2035

Arbitrum Whales Invested $100 Million Within the Last Two-Weeks

Furthermore, Whale investors have also maintained a neutral disposition amid warnings issued by the Curve Finance team. 

On-chain data shows that the whales holding balances of 100,000 to 10 million ARB added 96 million coins to their wallet balances in the second half of July. And as of July 31, they have not shown any early signs of a potential sell-off. 

How will Arbitrum (ARB) Investors React? | Whales Wallet Balances
How will Arbitrum (ARB) Investors React? | Whales Wallet Balances, July 2023. Source: Santiment

Will ARB price currently sitting at $1.18, the newly-invested 90 million tokens are worth $113 million. If the whales panic and offload a large portion of it, it could trigger an instant price correction. 

Also, strategic investors will closely watch the whales’ trading activity as more information regarding the Curve Finance hack filters through the media. 

ARB Price Prediction: Further Consolidation Around $1.20

As observed above, long-term holders and whale investors are currently maintaining a neutral stance amid the warning issued by the Curve Finance team. ARB will likely continue consolidating around the $1.20 territory if the exploit is quickly contained. 

In indication, the MVRV ratio confirms that the majority of holders that bought ARB in the last 30 days are currently holding profits of about 14%. Historical data suggests that many of them could keep holding until it reaches 20%, around $1.25.

But, if the bulls ignore the Curve Finance FUD, ARB could rally toward $1.30 before the bears get to regroup.

Arbitrum (ARB) Price Prediction | MVRV ratio, July 2023
Arbitrum (ARB) Price Prediction | MVRV ratio, July 2023 | Source: Santiment

Yet, if the Curve Finance exploits spark a panic sell among Arbitrum holders, the bears can force a downswing below $1. However, at that point, investors could stop selling around $1.05 to avoid slipping into a net-loss position. 

Nevertheless, if that support level does not hold, ARB could drop toward $0.90.


In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.

Ibrahim Ajibade
Ibrahim Ajibade Ademolawa is an experienced research analyst who began his career in Commercial Banking. He has worked with several Web3 startups and financial institutions...