Arbitrum launches $40M DeFi incentive amid intensifying L2 race

Arbitrum, the largest Ethereum layer-2 protocol, has launched a new initiative designed to channel liquidity into decentralized finance.

The DeFi Renaissance Incentive Program (DRIP), announced on Sept. 3, will allocate up to $40 million in rewards to users performing targeted on-chain actions rather than simply generating attention.

The program, structured by Entropy and powered by Merkl, will be managed by Entropy Advisors under the direction of ArbitrumDAO. According to the blockchain network, roughly 80 million ARB tokens have been earmarked for incentives across four distinct “seasons,” each focusing on a different corner of DeFi.

The first season, which runs from Sept. 3, 2025, through Jan. 20, 2026, prioritizes looping leverage on lending markets.

During this phase, users can earn up to 24 million ARB in rewards by borrowing against yield-bearing ETH and stablecoin assets on approved platforms.

According to Arbitrum, the structure is performance-...

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