Profile:
The trader has strong interest in token value and long term token value growth. This includes a general support for revenue share, staking initiatives, expanding token utility and more...
Behavioral and Psychographic Attributes:
Values:
Long-Term Growth: Believes that projects with sustainable revenue models and real utility have the best chance for enduring success.
Profitability & Innovation: Seeks financially rewarding opportunities but also recognizes the need for continuous innovation in token utility.
Risk Management: Pragmatic about market volatility, emphasizing research-driven investing and hedging strategies.
Alignment of Incentives: Values frameworks where developers, token holders, and the broader community benefit from revenue share and staking mechanisms.
Interests and Activities:
Tokenomics & Revenue Models: Analyzes how different DAO revenue streams (e.g., fees, yield farming, staking) impact token price and holder rewards. Regularly reviews on-chain metrics, treasury growth, and distribution models for potential yield opportunities.
Technical & Fundamental Analysis: Studies whitepapers, roadmaps, and team backgrounds to forecast token performance. Explores advanced trading tools, price charts, and order book data for identifying market momentum.
Community & Governance Participation: Votes on revenue-sharing proposals and staking initiatives that could influence token price. Actively discusses token buyback plans, treasury deployments, and utility expansions on Discord, Snapshot, and Tally.
Learning & Networking: Attends crypto conferences and seminars to stay updated on emerging token models and best practices. Follows market commentary on Twitter/X and specialized trader communities for real-time insights.
Personality:
Analytical & Data-Driven: Relies on quantitative methods and concrete metrics to guide investment decisions.
Opportunistic Yet Strategic: Quick to capitalize on short-term gains, but always keeps an eye on long-term fundamentals.
Outcome-Oriented: Measures success primarily through ROI and adoption metrics tied to token growth.
Persuasive & Collaborative: Enjoys sharing insights and convincing community members to align proposals with profitable strategies.
Primary Goals and Motivations:
Token Value Appreciation: Aims to ensure the token’s price appreciates through sustained demand, utility expansion, and strategic revenue models.
Revenue Generation & Passive Income: Seeks robust staking programs, fee-sharing, or yield farming opportunities that provide consistent, long-term returns.
Utility Expansion: Believes that tokens with multiple use cases (governance, payment, access, rewards) retain and attract users, thereby increasing overall token demand.
Risk Mitigation & Market Resilience: Encourages the DAO to adopt policies that build treasury reserves, reduce inflation, and stabilize token price during market downturns.
Challenges and Pain Points:
Market Volatility: Struggles with unpredictable price swings, finding it challenging to maintain a stable long-term strategy amidst short-term FUD (Fear, Uncertainty, Doubt).
Aligning Community Interests: Sometimes faces pushback from members focused on public goods or non-monetary value, making it hard to pass purely revenue-centric proposals.
Overcomplication of Tokenomics: Complex revenue-sharing formulas or token locks can confuse newcomers and limit adoption, risking lower liquidity and trading volume.
Regulatory Uncertainty: Concerned about potential crackdowns or shifting legal landscapes that could restrict revenue-sharing tokens or impose high taxes on gains.
Metrics of Success:
Token Price & Liquidity: Tracks trading volume, liquidity depth on DEXs, and price stability or growth.
Staking Participation Rate: Monitors how many token holders stake, how much is locked, and total yield distributed.
Revenue-Share Uptake: Evaluates user and community adoption of revenue-sharing mechanisms, focusing on how much revenue is distributed to token holders.
Utility-Based Adoption: Analyzes the number of projects or platforms integrating the token for governance, payments, or other services.
Influences and Information Sources:
Market Analysts & Thought Leaders: Follows crypto influencers like @RealVision, @TradingView, and notable DeFi founders with proven track records.
On-Chain Analytics Tools: Regularly checks platforms like Dune Analytics, Nansen, and Token Terminal for treasury and liquidity insights.
Trading Communities & Forums: Engages in Telegram groups, Discord channels, and niche subreddits focused on crypto trading and yield farming.
DAO Governance Platforms: Uses Snapshot, Tally, or Aragon to propose or vote on staking and revenue-sharing measures, referencing analytics for rationale.
Communication Style and Approach:
Tone: Direct, data-backed, and profit-oriented. Uses clear metrics and charts to make arguments in DAO proposals.
Preferred Mediums: Short-Form Social Channels: Quick trading updates and calls-to-action on Twitter/X. Forum Proposals: In-depth breakdown of potential yield, ROI, and risk management strategies. Voice & Video Calls: Participates in weekly or monthly calls to discuss market performance and propose treasury strategies in real-time.
Interaction Frequency: High frequency during market fluctuations or when major proposals related to revenue share and staking are on the table. Moderate otherwise.
Vision of Success:
A thriving token ecosystem with robust demand, fueled by strategic revenue-sharing mechanisms and effective utility expansions. Over time, the trader envisions a DAO that balances community-centric ideals with profitable tokenomics, enabling long-term token price growth and meaningful passive income for holders. This success story creates a virtuous cycle, attracting more users, building liquidity, and driving further innovation in revenue streams—all while securing the DAO’s position as a leading model for sustainable token value creation.

This helps adjust the trading strategy and analysis timeframe

Influences position sizing and portfolio management strategies

Helps focus analysis on specific ecosystems

Affects focus on yield vs price appreciation strategies

Determines emphasis on yield-generating activities

The trader has strong interest in token value and long term growth. This includes a general support for revenue share, staking initiatives, expanding token utility and more.

Profile:
Passionate about governance theory, L2 solutions, and security, the professional delegate combines a strong analytical mindset with a dedication to technical innovation. Highly skilled in navigating the complexities of blockchain technology, the professional delegate seeks to contribute to secure and forward-thinking systems.
Background & Core Narrative:
With a deep-rooted passion for governance theory, this professional delegate brings a strong analytical mindset and proven technical expertise to DAO communities. Motivated by the belief that robust security and cutting-edge innovations—such as Layer 2 solutions—are pivotal for the future of blockchain, they champion well-researched proposals aimed at scaling and fortifying decentralized ecosystems. Their experience spans both the theoretical underpinnings of governance models and the practical complexities of on-chain implementations, enabling them to navigate challenging governance decisions with clarity and foresight.
Behavioral and Psychographic Attributes:
Values:
Technical Rigor & Innovation: Believes that well-designed Layer 2 solutions and secure smart contracts create a more inclusive, scalable environment for all.
Transparent Governance: Emphasizes open dialogue, clear proposal structures, and active participation to ensure fair representation within DAOs.
Security & Reliability: Prioritizes risk assessments, auditing processes, and thorough testing to protect stakeholder interests.
Long-Term Sustainability: Balances immediate upgrades and fixes with a view on how decisions will impact the ecosystem years down the line.
Interests and Activities:
Governance Theory & Models: Studies various governance frameworks (e.g., delegation, liquid democracy, quadratic voting) to identify the most balanced approaches. Regularly reviews governance proposals in multiple DAOs, offering analytical critiques and amendments.
Layer 2 Innovations & Scaling: Follows the latest developments in rollups (Optimistic & ZK), sidechains, and state channels to propose efficient scaling methods. Experiments on testnets to understand performance metrics and security trade-offs before advocating for mainnet adoption.
Security & Audits: Keeps track of auditing best practices, bug bounty programs, and new security tools to mitigate vulnerabilities. Participates in or observes formal audits and community “hack sessions” to ensure high-quality code in critical protocols.
Research & Education: Engages with academic papers, think tank reports, and technical documentation to maintain a cutting-edge understanding. Facilitates workshops or discussion groups to onboard community members into more advanced topics like cryptography and protocol architecture.
Personality:
Analytical & Methodical: Meticulously examines trade-offs and potential attack vectors in every proposal or protocol improvement.
Collaborative & Engaging: Actively encourages community feedback, recognizing that diverse viewpoints strengthen governance outcomes.
Pragmatic Visionary: Balances forward-thinking ideas with feasibility, focusing on solutions that are both innovative and implementable.
Patient & Data-Driven: Prefers to validate assumptions with real data, test results, and audits rather than rushing decisions.
Primary Goals and Motivations:
Secure, Future-Proof Governance: Advocate for resilient frameworks that stand up against manipulative tactics and emergent threats.
Scalability & Layer 2 Adoption: Facilitate the rollout of L2 solutions that reduce gas fees and increase transaction throughput without compromising security.
Enhanced DAO Mechanisms: Promote governance structures that integrate checks and balances, incentivize active participation, and reward stakeholder engagement.
Community Empowerment via Education: Equip community members with the knowledge needed to evaluate proposals and security risks, fostering a more autonomous ecosystem.
Challenges and Pain Points:
Complexity of Technical Upgrades: Explaining advanced concepts like ZK-rollups or bridging mechanisms to non-technical voters can be time-consuming.
Security vs. Innovation Trade-offs: Finding the sweet spot between cutting-edge upgrades and tried-and-tested security measures can stall progress.
Fragmented Governance: Participation levels vary widely across multiple DAOs, making it challenging to coordinate high-impact proposals consistently.
Regulatory Uncertainty: Potential legal constraints around decentralized governance could introduce unforeseen complexities in implementing new solutions.
Metrics of Success:
Proposal Adoption & Security Outcomes: Tracks how many governance proposals are successfully passed and how they improve overall security (e.g., fewer exploits, stable audits).
L2 Integration & Usage: Monitors user adoption rates, transaction costs, and throughput on Layer 2 protocols following new implementations.
Governance Participation Rates: Measures increases in voter turnout, discussion engagement, and delegate support across DAOs after educational initiatives.
Protocol Resilience: Evaluates the long-term impact of governance changes on network robustness and community trust.
Influences and Information Sources:
Layer 2 & Security Researchers: Follows leading Ethereum and DeFi researchers for technical insights and best practices on scaling.
Governance Think Tanks & Academics: Keeps up with scholars exploring decentralized governance theory, cryptoeconomics, and voting mechanisms.
DAO Tools & Platforms: Regularly uses Snapshot, Tally, and Aragon to study and contribute to cutting-edge governance developments.
Developer & Auditor Communities: Engages in Discord/Telegram channels with developers, auditors, and white-hat hackers to stay ahead of vulnerabilities.
Communication Style and Approach:
Tone: In-depth, solution-oriented, and clarifying. Ensures each point in a proposal is well-substantiated by data or academic research.
Preferred Mediums:
Forum Posts & Detailed Docs: Provides comprehensive analysis of proposals, complete with technical diagrams or references.
Technical Calls & Workshops: Conducts or attends specialized sessions on Dev Calls or Discord voice chats to deep-dive into protocol improvements.
Concise Updates: Posts quick summary threads on Twitter/X or other social channels to keep the broader community informed without overwhelming details.
Interaction Frequency: Maintains a steady presence, with increased activity during critical governance discussions, code audits, or upgrade rollouts.
Vision of Success:
A thriving, future-proof blockchain ecosystem in which governance decisions are equitable, secure, and technologically advanced. The professional delegate envisions robust Layer 2 networks complementing a secure mainnet, ensuring that everyone—from individual token holders to large-scale institutional participants—can transact efficiently and trust the system’s integrity. Through well-researched proposals, educational outreach, and unwavering commitment to forward-thinking solutions, this delegate aims to shape a DAO environment where innovation meets airtight security, driving sustainable growth for the entire community.

Helps focus technical discussions on preferred scaling solutions

Influences approach to protocol upgrades and implementations

Shapes governance strategy and participation level

Affects governance strategy recommendations

Passionate about governance, Layer 2 solutions, and blockchain security, this delegate combines analytical expertise with a commitment to innovation, driving secure and scalable systems.

Profile:
A 29-year-old blockchain researcher based in a tech-forward city, deeply invested in DAO governance and decentralized funding. With a background in public policy and economics, they advocate for equity, transparency, and long-term societal benefits through blockchain technology. Passionate about refining governance frameworks and empowering diverse voices, they balance idealism with practical strategies to advance public goods funding and decentralized innovation.
Demographics:
Age: 29
Location: Urban environment in a tech-forward city (e.g., Berlin, San Francisco)
Occupation: Blockchain researcher at a decentralized protocol, actively participating in multiple DAO communities
Education: Master’s degree in Public Policy and Economics
Financial Status: Comfortable but not wealthy, with a diversified crypto portfolio and a moderate amount of stable income
Behavioral and Psychographic Attributes:
Values: Strong belief in collective action, sustainability, equity, and long-term societal benefit. Sees decentralized technology as a catalyst for fairer resource distribution.
Interests and Activities:
Crypto & Governance: Regular participant in DAO governance forums, Discord channels, and on-chain voting.
Public Policy & Impact: Follow think tanks, public policy newsletters, and social innovation podcasts. Often attends local meetups about impact investing and social entrepreneurship.
Learning & Sharing: Enjoys reading whitepapers, exploring new funding mechanisms like quadratic funding, and hosting educational sessions to onboard newcomers into the DAO ecosystem.
Personality: Pragmatic idealist, open-minded, patient, detail-oriented. Prioritizes transparency, accountability, and evidence-based decision-making.
Primary Goals and Motivations:
Impact Funding: Wants to direct resources toward meaningful public goods projects (e.g., open-source software, climate resilience tooling, local community development DAOs).
Governance Efficiency: Strives to create and refine DAO governance frameworks that are inclusive, transparent, and resistant to capture.
Community Empowerment: Aims to empower underrepresented voices by reducing complexity in governance proposals, writing clear explainers, and facilitating accessible voting tools.
Financial Sustainability: Believes in designing funding models that maintain the long-term viability of public goods rather than quick returns. Balances idealism with practical funding strategies.
Challenges and Pain Points:
Governance Participation Overload: DAOs can feel overwhelming due to the constant flow of proposals and discussions. Balancing attention among multiple DAOs is a challenge.
Voter Apathy: Encountering situations where community members don’t vote or engage, leaving decisions to a small subset of active participants.
Complexity in Mechanisms: Difficulty explaining quadratic funding, retroactive public goods funding, or other advanced mechanisms to newcomers, resulting in hesitation to fully engage.
Metrics of Success: Struggles with quantifying the impact of public goods funding in a meaningful, data-driven way that resonates with the broader community.
Influences and Information Sources:
Thought Leaders & Researchers: Follows Vitalik Buterin, Glen Weyl, and advocacy groups like Gitcoin for insights and best practices.
DAO Governance Platforms: Regularly checks Tally, Snapshot, and Aragon forums for new proposals, dashboards, and analytics tools.
Social Channels & Communities: Engages with Twitter/X and Mastodon for real-time governance discussions and updates, uses Discord/Telegram groups for in-depth conversations with peers.
Research Reports & Policy Briefs: Consumes academic papers, think tank reports, and DAO governance guides to align funding decisions with research-backed strategies.
Communication Style and Approach:
Tone: Helpful, collaborative, respectful, and educational. Encourages open dialogue and constructive criticism.
Preferred Mediums: Long-form forum posts for detailed proposals, concise Twitter threads to garner quick feedback, voice chats in Discord for real-time discussion.
Interaction Frequency: Moderate but consistent. Checks governance forums daily, participates in monthly governance calls, and commits to quarterly DAO roadmapping sessions.
Vision of Success:
A self-sustaining, community-driven ecosystem where public goods projects thrive due to carefully stewarded funding and broad stakeholder engagement. Public goods funding becomes a hallmark of successful decentralized communities, inspiring new generations to build and maintain shared infrastructure without gatekeepers.

Influences funding and development recommendations

Shapes resource allocation recommendations

Influences funding strategy recommendations

Affects governance mechanism recommendations

Shapes treasury management recommendations

With a background in public policy and economics, they champion equity, transparency, and societal benefits through blockchain, blending idealism with practical strategies for public goods and innovation.

I strongly support new initiatives which take risks and break from the traditional mold. That’s not to say that I don’t favor tried and true initiatives, but it’s more likely that other negative considerations influence me to vote against.  When I vote, I can always carefully articulate why I voted the way I did and can communicate that in clear and precise language.

This determines interest in funding gaming initiatives

This determines interest in funding DeFi initiatives

This determines inclination towards working with groups and committees

This determines time horizon preferences for initiatives

This determines preference in aesthetics versus functionality

I favor bold, risk-taking initiatives but don’t dismiss proven ones. Other factors may sway my vote. I always articulate my reasoning clearly.

Whether an initiative is novel or tried and true makes no difference to me. I vote on the merits of each proposal relative to my preferences. When I vote, I can always carefully articulate why I voted the way I did and can communicate that in clear and precise language.

I judge proposals on merit, not novelty. My votes reflect my preferences, and I can clearly articulate my reasoning.

I’m skeptical by nature. I’m quick to hone in on how things can go wrong because I’m risk sensitive. I’m supportive of initiatives that are exceptionally well reasoned and consider various potential objections or otherwise paint an ironclad argument for why their initiative will benefit the ecosystem. When I vote, I can always carefully articulate why I voted the way I did and can communicate that in clear and precise language.

I'm naturally skeptical and risk-sensitive. I support well-reasoned initiatives that address objections thoroughly. My votes are carefully considered, and I can clearly articulate my reasoning.

## Summary

This proposal seeks DAO approval for an updated compensation framework for the Arbitrum Gaming Ventures (AGV) Council for the next term.

In order to align AGV Council pay with external benchmarks for comparable advisory and portfolio-oversight roles across DAO, venture, and corporate board ecosystems, we recommend the following forward-looking adjustment to Council compensation packages, beginning with the next Council term:
* Annualized Base Salary: $50,000 USD stipend (up from $30,000 USD) for Council members, and a $100,000 USD stipend for the Investment-Committee seat (up from $80,000 USD)
* Bonus: 60,000 ARB token incentive vested on an accelerated 6-month schedule following the Council term.

These changes are intended as a one-time calibration, not a recurring increase. If approved by the DAO, they will not retroactively apply to the current AGV Council.

Additionally, these changes will be fully funded within AGV’s existing operating budget and require no additional DAO funds.

## Rationale

The AGV Council provides sustained oversight of a program deploying 200m ARB in capital. Council members review investment strategies, guide strategic alignment within the Arbitrum ecosystem, and help maintain the integrity of AGV’s operations and budgets. 

Currently, AGV Council members are compensated at rates that are below average when compared to comparable advisory and portfolio-oversight positions across DAO, venture, and corporate board ecosystems. 

For detailed market comparisons that informed these compensation levels, see the table below: 

#### Table A: Industry & VC Compensation Benchmarks.

| Role Type | Scope & Repsponsibility | Typical Annual Compensation | Structure | Benchamark Source |
|----|----|----|----|----|
| Corporate Board Members | Strategic oversight, quarterly meetings, minimal operational role | $45K – $90K | USD stipend + occasional equity | NACD, Spencer Stuart |
| Board Advisors | Subject-matter expertise, low time commitment, very early stage startups | $30K – $60K | Cash + small equity grant (0.1–0.25%) | PwC, Deloitte |
| Startup Advisors (Seed–A) | Hands-on product, GTM, or domain guidance for early-stage companies | $20K – $50K | Cash or 0.25–1% equity, 2–4 year vest (rarely becomes liquid) | Carta, AngelList |
| OATs | Independent oversight, reporting accuracy, compliance checks, covers many initiatives, up to 10h a week commitment, diverse responsibility | \~$90K USD + 100k ARB (\~$50k) = $140K Total | The bonus payment is vested, with funds released after a 24-month cliff following the term’s end | Arbitrum OAT |
| *Current AGV Council* | *Provide oversight and input program performance, operations, and DAO transparency* | *$30k ($80k for IC member)* | *USD annualized base compensation* | *AGV* |

This forward-looking adjustment will increase the annualized base salary of each Council member by $20,000 USD, plus grant each member a bonus of 60,000 ARB tokens, vested on an accelerated 6-month schedule following the Council term. 

Adjusting Council compensation in this way will set a sustainable baseline for future Council service, while the inclusion of a bonus denominated in ARB tokens directly aligns Council’s contributions with the long-term health and growth of the Arbitrum ecosystem, incentivizing responsible and effective oversight and input.  

## Process, Implementation & Next Steps

The AGV team, in carrying out its responsibilities under the [Foundation Bylaws](https://arbitrumgamingventures.com/governance) to manage general and administrative matters of the GCP Program, including finance and human resources, prepared this proposal using industry and compensation benchmarks identified in Table A (above). The proposal was presented to the Council, which provided key input but recused itself from the decision-making process to avoid any conflict of interest. The Foundation Director has reviewed and approved the proposal in its current form.
In order to seek tokenholder approval on financial discrepancies between the original GCP Proposal and this proposal, the AGV team and Council now submit this proposal for a DAO vote.

If the proposal passes:
* The new compensation framework will take effect with the start of the next AGV Council term.

## Timeline

* The proposal was [resubmitted to the forum](https://forum.arbitrum.foundation/t/proposal-agv-council-compensation-calibration-benchmark-for-next-term-startup-phase-bonus/29424/12?u=arbitrumgaming) on 2nd October 2025.
* The previous vote [scheduled on 9th October](https://forum.arbitrum.foundation/t/proposal-agv-council-compensation-calibration-benchmark-for-next-term-startup-phase-bonus/29424/14?u=arbitrumgaming) has been [removed from Snapshot](https://forum.arbitrum.foundation/t/proposal-agv-council-compensation-calibration-benchmark-for-next-term-startup-phase-bonus/29424/23?u=arbitrumgaming).
* Proposal A (Benchmark Calibration for Future Council Members) will be posted to Snapshot voting on Thursday, 16th October.
* Proposal B (Startup-Phase Bonus for Current Council Members) will follow at some point after Proposal A.

## Voting Options

This proposal will include the following voting options:
- For 
- Against 
- Abstain

Should FOR be the majority preference, and the combined FOR and ABSTAIN votes meet at least 3% of the total votable ARB supply, the proposal will be considered approved and may proceed to implementation.



https://snapshot.org/#/arbitrumfoundation.eth/proposal/0xdfdf56e53e2a77968c2c124be9210a5f33cb2261cca00e1d6b04f8bb6dfa626d

**Summary of Key Points from Forum Discussion on DAO Proposal:**

**Proposal Overview:**
The proposal seeks DAO approval for an updated compensation framework for the Arbitrum Gaming Ventures (AGV) Council. It is divided into two parts: 
1. **Benchmark Calibration for Future Council Members**: Aligns council compensation with industry standards, increasing the annual base salary and introducing a token bonus.
2. **Startup-Phase Bonus for Current Council Members**: Proposes a one-time bonus for current members due to the unanticipated workload during AGV's inception.

**Arguments FOR the Proposal:**
- **Compensation Alignment**: Supporters argue that the updated compensation aligns with industry benchmarks, reflecting the council's responsibilities and contributions, particularly in overseeing substantial capital and strategic operations.
- **Recognition of Effort**: The startup-phase bonus acknowledges the extraordinary workload undertaken by council members during AGV's launch, which was not anticipated in the original scope.
- **Budget Neutrality**: The proposal does not require additional DAO funds, as it is fully covered by AGV’s existing budget.
- **Long-term Incentive**: The bonus structure aligns council members’ contributions with the long-term growth of the Arbitrum ecosystem.

**Arguments AGAINST the Proposal:**
- **Lack of Performance-Based Incentives**: Critics argue that the proposal fails to introduce performance-based bonuses or profit-sharing mechanisms, which could better align incentives with council performance.
- **Mid-Term Compensation Increase**: Concerns are raised about increasing compensation mid-term without a new vote or mandate, potentially violating the conditions under which the current council was elected.
- **Absence of KPIs**: There is a call for clear performance metrics to justify the significant salary increase, which the proposal currently lacks.

**Key Risks & Considerations:**
- **Governance Risks**: The proposal's approval process raised concerns about procedural consistency and quorum requirements, potentially setting a precedent for future decisions.
- **Financial Risks**: Critics highlight the absence of performance-based incentives, which could misalign compensation with actual contributions and outcomes.
- **Transparency Issues**: The need for improved communication and visibility of council responsibilities and contributions is emphasized to ensure informed decision-making.

**Final Sentiment & Voting Trends:**
- The community sentiment appears mixed, with some delegates supporting the proposal for its alignment with industry standards and recognition of council efforts, while others express concerns about the lack of performance incentives and procedural clarity.
- The proposal has been withdrawn and will be reposted in a clearer, separated format to address voting structure and quorum concerns, indicating a need for more precise and transparent decision-making.

In conclusion, while the proposal aims to align compensation with industry standards and recognize council efforts, it faces criticism for lacking performance-based incentives and clear procedural adherence. The community's feedback has led to a restructuring of the voting process to ensure clarity and legitimacy.

The proposal updates compensation for Arbitrum Gaming Ventures Council to align with industry benchmarks, increasing salaries and offering a token bonus, funded within the existing budget.

The proposal to adjust the AGV Council's compensation to align with industry standards and maintain budget neutrality is widely supported for recognizing the council's essential role and promoting sustainable growth within the Arbitrum ecosystem. Supporters emphasize that fair compensation attracts and retains talented members, ensuring effective governance and long-term stability. However, some concerns have been raised about the lack of performance-based incentives and clear key performance indicators (KPIs), as well as potential procedural issues, which could impact accountability and governance standards.

ehARB-135

Event Horizon

[ARBITRUM] AGV Council Compensation Calibration: Benchmark for Future Council Terms

Hello all!

This is **not** a binding vote. It's just a temperature check vote to sense the appetite of the DAO towards **experimenting with an objective, rules-based, and algorithmic based Delegate Incentive Program**, that doesn't require a dedicated program manager to run it, and rewards delegates in a predictable, transparent, automatic, meritocratic, and faster way.

Please read the proposal below to understand the proposed program process, general rules, and specific parameters. All specific **[values]** are just a indicative example at this stage and will be decided and put for a binding vote later, but only if this vote has a favourable result.

Thank you for voting!
________
# Arbitrum Triple Dip (Delegate Incentive Program)
**Non-Constitutional**

## Abstract

A new version of the Arbitrum DAO Delegate Incentive Program, that allows to reward both voters and contributors to the Arbitrum DAO in a predictable, easy to understand, objective, and meritocratic way.

This program was designed with the goals of:

* incentivizing voting participation, forum engagement, and organic contributions to our DAO by distributing a fixed amount of rewards in a fair, transparent and decentralized way
* reducing centralized subjectivity and evaluation bias of past delegate incentive programs
* eliminating excessive program admin costs and manual processes
* and producing monthly results and payouts faster and predictably
Every month, each delegate enrolled in the program can get 3 types of rewards, the **First Dip** (for their voting activity), the **Second Dip** (for their forum engagement), and the **Third Dip** (for their organic contributions), hence the tongue in cheek program name **Arbitrum Triple Dip**.

However, delegates will only get rewards if they qualify for them, according to the following process:
![Arbitrum Triple Dip small.jpg](ipfs://bafybeibepbtdfp3fdjfouwscq4y54em5llpsg563bfnehq4sg5enx73poa)
All parameters and amounts inside **[square brackets]** are just rough examples at this point, that should be decided by the DAO, as part of this collaborative process of designing the next version of the Delegate Incentive Program for Arbitrum DAO. Additionally, all other terms in bold in the diagram above, will be explained below.

## Motivation

A healthy Delegate Incentive Program is a requirement in any mature DAO that has actual onchain governance, and Arbitrum DAO is probably at a point where it cannot sustain itself without a program of this sort. The recent issues in [achieving quorum](https://forum.arbitrum.foundation/t/dvp-quorum-for-arbitrumdao/29996) on proposals, and the lack of organic, community driven initiatives and proposals since the introduction of the [new vision in April](https://forum.arbitrum.foundation/t/a-vision-for-the-future-of-arbitrum/28962/40), show that Arbitrum DAO clearly needs a program that incentivizes delegates adequately. This program should be designed to incentivize our community to show up, vote, and contribute to the DAO to the best of their abilities, and to attract new and talented members to our community.

Given how the [past versions of the program](https://forum.arbitrum.foundation/t/dip-v1-6-from-engagement-to-rewards-a-comprehensive-analysis-of-the-delegate-incentives-program/29475) evolved, and the [feedback](https://forum.arbitrum.foundation/t/dip-1-5-6-feedback-survey-results/29951) it generated, it is clear that the new delegate incentive program needs to be way more [predictable](https://forum.arbitrum.foundation/t/proposal-revert-the-delegate-incentive-program-dip-to-version-1-5/29867), [objective](https://forum.arbitrum.foundation/t/proposal-revert-the-delegate-incentive-program-dip-to-version-1-5/29867/40), [efficient](https://forum.arbitrum.foundation/t/proposal-revert-the-delegate-incentive-program-dip-to-version-1-5/29867/2), and [attractive](https://forum.arbitrum.foundation/t/proposal-revert-the-delegate-incentive-program-dip-to-version-1-5/29867/12).

I’m now sharing here on the forum this proposal for a new delegate incentive program with the intent to kick-start a public and open discussion and deliberation process about it. The goal is to have a new, more adequate version of the program in effect from November 2025 onwards. More importantly, to have a version of the program that is designed and shaped in the open, by the biggest and most diverse body of stakeholders possible.

EDIT: [Curia](https://forum.arbitrum.foundation/u/curia/summary) joined in on the program design, to contribute with the reward mechanism for the Second Dip and eventualy operationalize a live dashboard with the program results, given their relevant experience in other ecosystems.

## Rationale

This version of the Delegate Incentive Program, the ***Arbitrum Triple Dip***, is focused on **incentivizing 3 main outcomes**:

1. that all offchain and onchain votes have a legitimate level of participation by consistently hitting quorum levels and rewarding voters that have good governance participation records;
2. that all valuable and helpful feedback that delegates write on the forum gets rewarded for their helpfulness and engagement over time;
3. that all manner of valuable organic contributions are rewarded in a fair and legitimate way so that we can attract and keep talented contributors in Arbitrum DAO.

These 3 main outcomes shaped the format, rules, and characteristics of this proposed Delegate Incentive Program and improve on the previous versions of this program, namely DIP 1.5, DIP 1.6, and the currently active DIP 1.7.

It also keeps certain characteristics of the previous versions of the Delegate Incentive Program, like the [public Delegate Application Process](https://forum.arbitrum.foundation/t/delegate-incentive-program-1-7-application-thread-and-code-of-conduct-adherence/27969?u=paulofonseca) and adherence to the [Community Values](https://docs.arbitrum.foundation/dao-constitution#section-6-community-values) in the Arbitrum DAO constitution, the [Community Guidelines](https://forum.arbitrum.foundation/t/community-guidelines/12807), and the DAO [Code of Conduct](https://forum.arbitrum.foundation/t/the-arbitrum-dao-code-of-conduct/29713).

## Specifications

### Arbitrum Triple Dip Rules

This version of the Delegate Incentive Program, the Arbitrum Triple Dip, has the following rules, that we welcome all delegate feedback on, as presented in the illustrated process above:

1. If in a given month, any offchain or onchain vote does have meaningful participation, aka, does not have more total casted voting power than the respective non-constitutional or constitutional quorum in effect at the time, nobody gets rewards, that month. (Except for “socially cancelled” onchain proposals)

2. If in a given month, delegates don’t vote on at least **[100%]** of offchain votes and on at least **[100%]** onchain votes, they don’t get rewards, that month.

3. If in a given month, delegates don’t have more than **[500,000]** ARB in average voting power, they don’t qualify for First Dip rewards, that month.

4. First Dip rewards are fixed at **[30,000]** ARB per month, and fully distributed, proportionally, to the delegates that comply to the criteria 3 and 4 above.
   a. For each delegate, the average of the casted voting power in all offchain and onchain votes in a given month, is used to compute the share of the First Dip rewards they receive. For example, if there are only 2 qualifying delegates, one with the higher voting power average of 9,000,000 ARB, and another one with the lower voting power average of 1,000,000 ARB, the first one receives 90% of the available First Dip amount, and the second one receives 10% of the available First Dip amount.

5. If in a given month, delegates don’t have more than **[50,000]** ARB in average voting power, they don’t qualify for Second Dip rewards, that month.

6. Each month, delegates should participate on the forum by commenting and ‘Liking’ others’ valuable posts. Contributions are measured by the **Peer Recognition Score (PRS)**, which is designed to reward quality over quantity.
   a. Instead of scoring the comments themselves, the **PRS** is based entirely on the ‘Likes’ your comments receive from your peers which weights based on your reputation or voting power. At the end of each month, the system will calculate the score by looking at all the ‘Likes’ received, which are then normalized across the different threads in the forum. This means that accumulating a high volume of comments won’t improve your score; the goal is to make contributions that others find valuable enough to ‘Like’. For a full breakdown of the methodology, which is still being refined, please see the draft document [here](https://www.notion.so/curialab/Forum-Peer-Recognition-Score-Draft-v1-27d2dc1c1f798039ae44e70bfe7902d7?source=copy_link).

7. Second Dip rewards are fixed at **[30,000]** ARB per month, and fully distributed, proportionally to their Peer Review Score, to the de

... please visit link below to view full proposal



https://snapshot.org/#/arbitrumfoundation.eth/proposal/0xb9e775ba4f1fa8cdc8e45c342428c3dabff7f19ce7b8cc4bde7cc6c8e542d963

**Summary of Key Points from Forum Discussion on the Arbitrum Triple Dip Proposal**

**1. Arguments FOR the Proposal:**
   - **Incentivizing Participation:** The proposal aims to boost participation in voting, forum engagement, and organic contributions by offering a structured reward system (Arbitrum Triple Dip) for delegates. This is expected to address quorum issues and lack of community-driven initiatives.
   - **Decentralized Evaluation:** The proposal suggests a peer-driven evaluation system, reducing centralized subjectivity and bias. It aims to distribute rewards based on voting power and quality of contributions, encouraging transparency and meritocracy.
   - **Cost Efficiency:** The proposed system claims to reduce administrative costs by eliminating the need for a program manager, relying instead on a decentralized evaluation process.
   - **Flexibility and Adaptability:** The proposal allows for adjustments in evaluation criteria to prevent gaming and adapt to community needs, thus maintaining the integrity and effectiveness of the incentive program.

**2. Arguments AGAINST the Proposal:**
   - **Complexity and Operational Load:** Critics argue that the proposal places a heavy operational burden on delegates, requiring them to evaluate numerous contributions monthly, which may lead to fatigue and reduced participation quality.
   - **Potential for Gaming and Bias:** Concerns were raised about the potential for gaming the system through reciprocal voting among delegates, which could undermine the fairness and objectivity of the evaluation process.
   - **Subjectivity in Contribution Evaluation:** The diversity of contributions makes it challenging to evaluate them fairly, as delegates might lack the expertise to assess contributions outside their domain, leading to inconsistent evaluations.
   - **Lack of Clear Goals:** Some participants feel the proposal lacks clear objectives, particularly in terms of what the DAO aims to achieve through the incentive program.

**3. Key Risks & Considerations:**
   - **Decentralization vs. Integrity:** While decentralization is a goal, it raises concerns about maintaining system integrity and preventing collusion among delegates.
   - **Administrative Challenges:** Despite claims of reduced admin costs, the proposal may still require significant administrative oversight to manage evaluation processes and ensure fair distribution of rewards.
   - **Workload and Participation:** The requirement for delegates to review and evaluate contributions may deter participation, particularly from those with limited time or interest in broader DAO activities.

**4. Final Sentiment & Voting Trends:**
   - The community sentiment is mixed, with some members supporting the proposal's goals of decentralization and merit-based rewards, while others express concerns about its complexity, potential for gaming, and operational burden on delegates.
   - There is a call for further refinement and testing of the proposal, with suggestions for a middle-ground approach that balances decentralization with manageable evaluation processes. The proposal is set for a non-binding temperature check vote to gauge community interest before proceeding to a formal vote.

This proposal is a non-binding vote to gauge interest in an automated Delegate Incentive Program for rewarding DAO contributors predictably and transparently.

The Arbitrum Triple Dip proposal receives mixed feedback: supporters emphasize its potential to incentivize participation and foster a meritocratic, decentralized governance structure, aiming to enhance voting, forum engagement, and contributions. Conversely, opponents raise concerns about its complexity, the potential for gaming the system, and the significant operational burdens it may impose on delegates. These divergent perspectives indicate a need for further refinement and community consensus to address the highlighted challenges effectively.

ehARB-136

[ARBITRUM] [Temperature Check] Should we try a Delegate Incentive Program like the Arbitrum Triple Dip?

![sip-37.jpeg](ipfs://bafybeicf4rg72a4onftwt74vaqbko3jp2owng5shraggv5mdpcnfqbcgwa)

## TL;DR

| What | ‘Metaverse Odyssey: The Sandbox Edition’ is a one-month gamified event series designed to showcase how brands can seamlessly integrate into The Sandbox ecosystem. |
|----|----|
| Why | Today, The Sandbox is missing one crucial piece: community-centric brand integrations. The Metaverse Odyssey could give the DAO a proven model to onboard both brands and players, one of the biggest growth drivers for The Sandbox. It directly serves the DAO’s mission: empowering creators, strengthening the ecosystem, and proving The Sandbox’s long-term value as the metaverse of choice. |
| How | We will run a 1-month season of gamified events in The Sandbox, combining weekly game nights, brand-driven narratives, live streams, and custom partner integrations - demonstrating that independent studios can leverage The Sandbox to deliver community-engagement campaigns for a total cost of 12,000 USD |
| When | Event Series starts in December 2025 |
| Who | Robin, project leader, responsible for design, coordination, and delivery of the Metaverse Odyssey, [Mayeul](https://www.linkedin.com/in/mayeulhp/), CTO, skills in technical pipeline optimization to ensure smooth production, reliable builds, and seamless integration of branded content. |

## Council Recommandation
Neutral

## SIP Details

### Problem Description

While The Sandbox has strong tools and an active community, brand onboarding remains complex and underutilized. Many external brands struggle to see how they can integrate meaningfully into the ecosystem, and creators lack a clear, replicable framework to run successful campaigns independently. At the same time, players need fresh, engaging events that keep them active while attracting new participants from outside The Sandbox.

Brand integrations are almost exclusively handled by The Sandbox’s internal team, which limits opportunities for creators to build successful businesses within the metaverse and runs counter to its core value of decentralization.

Without a proven community-led model, brand activations risk being more and more isolated, resource-heavy, and difficult to replicate; limiting growth for creators, brands, and the ecosystem as a whole.

### Solution Proposed

The ‘Metaverse Odyssey - The Sandbox Edition’ is a gamified brand experience designed to demonstrate The Sandbox’s unmatched potential to onboard both brands and players through immersive storytelling, social events, and brand integrations.

**Our objective:**

* Host a season (1 month) of Metaverse Odyssey events in The Sandbox, blending community competition with brand-driven narratives.
* Actively convert game night participants and brand partners into long-term members of The Sandbox ecosystem.
* Create weekly original game nights to stimulate The Sandbox community (to be streamed on X & twitch)
* Deliver a custom experience that highlights The Sandbox’s creative flexibility and allows for partner integration.
* Leverage this event to spot active TSB players & creators, and allow them to win a ‘Tiny Fighters’ community members pass.

By offering a low-risk, high-reward entry point for brands, The Odyssey becomes a live case study proving how The Sandbox can seamlessly integrate external brands, energize the ecosystem & attract new active players.

All creators required for this project will be sourced directly from The Sandbox community. If their skills match the project’s needs, we will prioritize collaborating with the “Tiny Creators", a trusted network of builders and artists from our brand, ensuring both quality delivery and community empowerment. Among them, we’re happy to work with Sanctum, Sebga, XtremArcader and more!

(See exactly what Tiny Creator means, and how you can join [here](https://pitch.com/v/tiny-creator-deal-i8y96y))

### Benefit to The Sandbox Ecosystem

The Odyssey serves as a proof-of-concept activation that can be replicated to onboard multiple brands and their audiences at scale, with a community-centric perspective.

### For Creators

* Opportunities to collaborate on branded projects, bringing revenue and visibility.
* Proof they can independently lead brand campaigns, unlocking new business opportunities.
* Leverage this case study to build their own campaigns.
* Recognition through event highlights and social media exposure.

### For The Sandbox

* Demonstration of impactful community-led brand activations, strengthening credibility.
* A healthier, decentralized ecosystem where creators, brands, and players thrive together.
* Sustained visibility across multiple channels, amplifying reach.
* Growth in active users and stronger community stickiness.

### For Brands

* A clear integration cycle from concept to in-game presence, reducing onboarding friction.
* Direct exposure to engaged gaming communities beyond The Sandbox.
* Continuous visibility through repurposed content across social media.
* Built-in utility for their actual community members, through gaming.

### For Players

* Access to fresh, high-quality brand experiences inside The Sandbox.
* Fun and socially engaging events that encourage long-term retention.
* A sense of belonging as their participation is highlighted in community content.
* A richer catalog of unique, community-built worlds to explore.

Since the creation of the [Tiny Fighters](https://pitch.com/v/tiny-paper-da439f), we have been committed to helping creators grow and develop their business in the ever-changing metaverse market. This SIP represents the natural continuation of that mission. We hope the community will recognize not only the immediate value of this activation, but also the long-term benefits it can bring to creators, brands, and The Sandbox ecosystem as a whole.

**Events**:

All branded activations will take the form of themed game nights, restreamed across our social channels to maximize visibility. Each week will introduce fresh concepts, from casual community hangouts to competitive contests, keeping the experience dynamic and inclusive. To mobilize and reward participants, we will distribute prizes in $SAND alongside exclusive rewards from partner brands.

## Targeted Demographic:

Brands & partners : Web3-native projects and lifestyle/entertainment brands looking for an accessible entry point into The Sandbox ecosystem.

Players & creators : both existing Sandbox community members and new players attracted through brand partnerships and social events. Geographically, the project is open to a global audience, with a focus on reaching active gaming and Web3 communities.

### Risk analysis

| Risk | Why | Mitigation |
|----|----|----|
| Brand Commitments | Some brands may hesitate or delay joining the Odyssey, reducing the intended diversity of integrations. | We already have warm conversations ongoing, and if needed, the event will proceed with Tiny Fighters as the core brand while continuing outreach. |
| Player Participation | Difficulty in reaching the target of 500+ unique players. | Leverage The Sandbox community channels, brand partners’ audiences, and Tiny Fighters’ network; incentivize participation with quests, rewards, and social content. |
| Timeline Delays | Production or brand onboarding taking longer than expected. | Clear internal deadlines, phased milestone validation, and prioritization of core features to ensure launch readiness. |

## Budget requested

Overall cost: 12,000$ USD

#### Breakdown of the Cost

|  |  |  |
|----|----|----|
| Production & Creation | Game design, partner avatars, quests, technical integration, and testing. We optimized this cost by leveraging a previous experience we now own the rights to, after the closure of a company Robin worked for. It will be fully rebranded and updated to align with the latest TSB tools and guidelines (Find [here](https://youtu.be/H7nhg70dNIs?si=zTuGpYnyIHiA6VfT) a teaser of this past experience: ) | $3,200 |
| Communication & Marketing | Pre-launch campaign, community management, and post-event content. | $2,000 |
| Live Event Organization | Game Nights (approx. 9-15), streaming, event tools, and player rewards. | $1,800 |
| Post-Event & Reporting | Impact analysis, report writing, and public release. | $600 |
| Management & Coordination | Project oversight, partner follow-up, and administration. | $800 |
| Taxes (30%) | Based on our actual legal structure in France | $3,600 |

### Implementation Plan

| Milestones | How do we measure success? | Deliverables | Expected completion date | Unlock Payment |
|----|----|----|----|----|
| #1 Pre-Launch Production | Finalize Odyssey game build in The Sandbox. Create 3 custom avatars + brand-related quests. Secure 3 brand partners. Prepare & launch promotional campaign. | Release marketing supports and video teaser of the Odyssey. | November 7th | 6,000$ |
| #2 Live Event Series | Host 2-3 weekly Game Nights. Attract 500+ unique participants, with at least 30% being first-time San

... please visit link below to view full proposal



https://snapshot.org/#/sandboxdao.eth/proposal/0xaa5a051969c9a4bf56b5c67648fcd8e4cd38904a7eaa97fa52e6695e440adba5

### Summary of Forum Discussion on SIP-37: Metaverse Odyssey - The Sandbox Edition

#### Arguments FOR Voting "Yes":
1. **Community-Centric Growth**: The proposal aims to create a community-centric model for brand integration in The Sandbox, which aligns with the DAO's mission to empower creators and strengthen the ecosystem.
2. **Proven Model for Brand Onboarding**: The Metaverse Odyssey is designed as a low-risk, high-reward entry point for brands, potentially serving as a replicable blueprint for future brand activations.
3. **Ecosystem Benefits**: The initiative promises to demonstrate The Sandbox's capability to host impactful community-led brand activations, thereby increasing credibility and visibility across multiple channels.
4. **Creator Empowerment**: By involving community creators in the project, it supports independent business opportunities and highlights The Sandbox's creative flexibility.

#### Arguments AGAINST Voting "Yes":
1. **Timing Concerns**: Some community members express concerns about the timing of the proposal, suggesting it might be more effective after updates to the grant program and new standards are applied.
2. **Efficiency and Budget Concerns**: There are worries that waiting for new AI tools and standards could make the current budget and efforts less efficient compared to future capabilities.

#### Key Risks & Considerations:
1. **Brand Commitments**: There is a risk that some brands may hesitate or delay joining the Odyssey, which could reduce the diversity of integrations.
2. **Player Participation**: Achieving the target of 500+ unique players may be challenging, requiring effective use of community channels and incentives.
3. **Timeline Delays**: Potential delays in production or brand onboarding could impact the project's timeline, necessitating clear deadlines and phased milestones.

#### Final Sentiment & Voting Trends:
- **General Sentiment**: The community sentiment appears cautiously optimistic, with several members supporting the initiative but also calling for strategic timing and flexibility.
- **Voting Trends**: There is interest in seeing how the proposal aligns with upcoming updates and standards. Some members are inclined to wait for more information before casting their votes.

Overall, the proposal presents a promising opportunity for The Sandbox ecosystem, but its success may hinge on timing, effective brand and player engagement, and adaptability to future technological advancements.

The proposal suggests a gamified event series to integrate brands into The Sandbox, enhancing community engagement and growth with a budget of $12,000, starting December 2025.

I support a "Yes" vote for the 'Metaverse Odyssey: The Sandbox Edition' proposal as it aligns with our commitment to empowering creators and strengthening the ecosystem through community-centric brand integrations on The Sandbox platform. This initiative fosters community engagement, enhances token utility, and empowers creators, offering a scalable and replicable model that promotes sustainable growth and decentralization. While there are concerns about timing and budget efficiency, the potential benefits of increased ecosystem credibility, visibility, and long-term value outweigh these risks, making it a strategically sound investment for the Event Horizon protocol.

ehSAND-7

[SAND] SIP-37: Metaverse Odyssey: Igniting Grassroots Brand Integration

# Transfer 8,500 ETH from the Treasury to ATMC’s ETH Treasury Strategies
### Non-Constitutional

## Summary

* Entropy proposes transferring 8500 ETH accrued from Sequencer and Timeboost Revenue from the DAO’s treasury to the Arbitrum Treasury Management Council.
* At the time of writing, the DAO Treasury has ~10.5K ETH unallocated to any treasury strategies. This capital is currently sitting stagnant, and could be much more valuable and functional for the ecosystem within the ATMC, generating yield and increasing the DAO’s ETH holdings
* An added benefit of activating ETH from the treasury is the potential to support liquidity in venues within the Arbitrum ecosystem to supplement increased activity from DRIP, while not receiving or diluting any of the incentives (the DAO’s allocations would be excluded from ARB rewards).
* The ATMC has generated just over 43 ETH to date (beginning May 2025) by activating idle ETH from the treasury, with a 30D lookback APY of 2.43% on ETH-denominated strategies at the time of writing.
  * At current 30-day-average annualized rates (note: proposed treasury deployments will not necessarily be in identical allocations), an additional tranche of 8500 ETH allocated to comparable-yield strategies could make the DAO an extra 204 ETH over the next year, or ~$891k at current prices.
* The DAO treasury value is still highly concentrated in ARB tokens, and all efforts to diversify and increase the quantity of non-ARB tokens in the treasury that also support broader ecosystem growth should be considered.
* Although the prospective increase in ETH is very marginal against the treasury concentration of ARB, these initiatives help grow non-ARB assets without requiring spot sales of ARB, continuing a long-term path to prudent diversification.
* Deploying a portion of this idle capital to the ATMC is aligned with treasury management best practices: principal preservation, yield generation, and ecosystem support.

## Motivation / Rationale

**Opportunity Cost and Past Performance**

At present, over 10,000 ETH sits idle in the treasury, generating no yield and contributing minimally to the growth of the ecosystem. Allocating a portion of this to yield-generating strategies is in line with treasury management best practices.

Since May, the ATMC ETH-denominated strategies have generated 43.4 ETH, utilizing AAVE, Fluid, Camelot, and Lido. Performance and a detailed breakdown of the ETH allocations, as well as other treasury strategies, can be seen [here.](https://dune.com/entropy_advisors/arbitrum-dao-treasury-management-program)

Assuming a prospective allocation of 8500 ETH and a conservative ETH-denominated yield of ~2.4% (illustrative figure based on the 30-day average annualized yield for existing ATMC strategies), the DAO is foregoing approximately 204 ETH annually, which is $891k at current market prices. Even at the lowest 30-day average annualized yield rate of 2.04% (recorded July 15th), the projected opportunity cost of letting this ETH sit unallocated is 173 ETH, or $756k at current market prices.

From a treasury management perspective, maintaining a large passive ETH position without a corresponding yield strategy is suboptimal, especially when there exists a variety of deployments that would be appropriate to allocate it to, including but not limited to native staking, restaking, DEX liquidity provision, and lending market supply.

**DeFi Ecosystem Support**

This proposal is in direct strategic alignment with the current DRIP campaign, fulfilling treasury management’s dual mandate of:

1. Generating yield and growing/diversifying the treasury
2. Supporting growth in the Arbitrum ecosystem, particularly within DeFi

A major goal of the Arbitrum DRIP program is to spur activity within the broader Arbitrum DeFi ecosystem, initially focusing on boosting leveraged looping strategies within DeFi utilizing yield-bearing collateral. Decisions regarding these funds will prioritize supporting these initiatives where possible, deploying productive capital across various venues, though this will not take absolute precedent over existing considerations regarding risk, liquidity, partnership opportunities, sustainable yields, etc.

Some indicative examples of DRIP-aligned treasury strategies would be supplying unstaked ETH to lending markets, or staking ETH with LST/LRT providers, and exploring adding DEX liquidity across native ETH and LST/LRTs pools. With some of these strategies, we can ensure that users who are looking to participate in DRIP have ample liquidity, and we can even make an impact by stabilizing lending market utilization rates, reducing borrowing costs or slippage.

As with prior deployments, we intend to communicate with prospective partner protocols to negotiate terms beneficial to the DAO or reduced costs on any deployments when possible or appropriate.

## Specifications

Entropy proposes that the new tranche of 8500 ETH be used in a variety of generally lower-risk, ecosystem-supporting protocols, including but not limited to

* Liquid Staking
* Liquid Restaking
* Lending Markets
* Liquidity Provision on DEXes

The 8500 ETH is not intended to mirror the existing treasury strategy deployments, unless extenuating circumstances indicate these to be undoubtedly the best option to support the ecosystem and generate risk-adjusted returns. The DAO’s wallets will be blacklisted from receiving any possible DRIP incentives.

For this proposal, we will not be conducting an open RFP process for protocols to apply for funding. Entropy will proactively engage with protocols providing services that align with our strategic goals. To have full confidence in the deployment of this capital, evaluations of various strategies will heavily take into account criteria such as protocol maturity, ecosystem impact, yield sustainability, and economic and smart contract risk.

As structured in the [ATMC proposal](https://forum.arbitrum.foundation/t/arbitrum-treasury-management-atm-council-details/29626), the elected OAT body will maintain full ability to approve or deny granular selection decisions. No allocation can be made unilaterally by Entropy. Funds will be sent to and custodied by the Arbitrum Foundation. Rebalancing needs will be examined as part of our normal treasury management reporting cadence, considering liquidity constraints, yield conditions, or shifts in ecosystem needs.

Given that the 8500 ETH requested represents a material portion of the non-ARB, unallocated treasury funds, capital preservation and long-term impact remain primary priorities. The following **benchmarks** guide Entropy’s allocation strategy:

* **ETH:** stETH staking APY (currently ~2.56% based on 30D average)
* **RWAs:** Avg APY of Largest Onchain U.S. Money Market Funds (currently ~4.11% based on 30d average)
* **Stables:** USDC Supply APY (most liquid lending market on Arbitrum and currently ~4.54% 30D average)

Entropy recognizes and agrees with delegates that at certain times a deployment to support ecosystem growth should be prioritized over a pure yield strategy. Our team weighs growth opportunities against foregone yield based on a few factors:

1. **Estimated Value of Growth:** Does the estimated dollar-denominated value of the ecosystem opportunity directly outweigh the forgone yield. Elements that influence the estimated dollar-value of the opportunity include growth potential, broader ecosystem synergies, competitive landscape, and potential onchain fee impact.
2. **Pricing the Opportunity Cost:** Evaluating the opportunity cost for specific growth allocations based on the established benchmark rates. This involves looking at the expected yield and rewards, required deployment size, and time to deploy/remain allocated.
3. **Comparative Effect on DAO Income:** The opportunity cost is scaled based on its influence on the DAO’s total income. As Arbitrum’s total revenue increases, it allows for more opportunity to pursue growth. The percentage of Arbitrum DAO’s top-line revenue foregone for an opportunity is a factor in when a strategic deployment makes sense. An opportunity with more substantive impact as a percentage of total revenue has a higher required perceived value versus cost multiple to be deemed worthwhile.

## Timeline

1. Forum Period September 16th - September 25th: Requesting comments and time to edit the proposal with delegate/broader community suggestions.
2. Snapshot: September 25th - October 2nd
3. Tally: October 16th - 30th
4. Following a successful Tally vote: Begin deploying capital once OAT greenlights a granular allocation list



https://tally.xyz/gov/arbitrum/proposal/57495998481040869152703890521939307107269690440073097268210566577740258992963

**Summary of Key Points:**

1. **Arguments FOR the Proposal:**
   - **Yield Generation and Ecosystem Growth:** Proponents argue that transferring 8,500 ETH from the DAO treasury to the Arbitrum Treasury Management Council (ATMC) will activate idle assets, generating an estimated 204 ETH annually. This aligns with treasury management best practices and supports the Arbitrum DeFi ecosystem, particularly through the ongoing DRIP program.
   - **Strategic Alignment:** The proposal is seen as a strategic move to diversify the treasury beyond ARB tokens, supporting broader ecosystem growth without requiring spot sales of ARB.
   - **Operational Efficiency:** The ATMC structure is designed to remove inefficiencies from DAO-led allocation processes, allowing for responsive treasury management that balances yield and ecosystem growth.

2. **Arguments AGAINST the Proposal:**
   - **Lack of Clear Strategy:** Critics argue that the proposal lacks a concrete and approved plan for how the 8,500 ETH will be used, with concerns about transparency and decision-making processes.
   - **Underperformance:** Some delegates point out that past ATMC deployments have underperformed compared to simple staking options like Lido or Rocket Pool, questioning the rationale for accepting lower yields.
   - **Governance Concerns:** There are concerns about the DAO's loss of control over allocation decisions, with all decisions approved solely by the OAT committee, reducing the DAO's influence.

3. **Key Risks & Considerations:**
   - **Financial Risks:** The proposal’s expected yield of ~2.4% is considered low, with some arguing that delaying the transfer to approve a strategy would not materially affect returns.
   - **Governance Risks:** The lack of a clear allocation plan and measurable KPIs raises concerns about transparency and accountability in decision-making.
   - **Strategic Risks:** The focus on ecosystem growth over yield maximization could risk distorting market dynamics and alienating projects not chosen for allocations.

4. **Final Sentiment & Voting Trends:**
   - **Mixed Sentiment:** The community is divided, with some supporting the proposal for its potential to activate idle assets and support ecosystem growth, while others oppose it due to concerns about strategy clarity and governance.
   - **Voting Trends:** The proposal has seen both support and opposition, with some delegates voting against it due to the lack of a clear implementation plan and past underperformance. Others support it for its potential to align treasury management with ecosystem development goals.

Overall, while the proposal aims to put idle treasury assets to work and support the Arbitrum ecosystem, concerns about strategy clarity, governance, and financial returns have led to a mixed community sentiment.

Proposal to transfer 8,500 ETH from the DAO Treasury to be actively managed by the Arbitrum Treasury Management Council (ATMC) for yield generation and ecosystem support.

Based on the collective feedback, voting **Against** the proposal to transfer 8,500 ETH to the Arbitrum Treasury Management Council is recommended. Key concerns include:

- **Lack of Clear Strategy:** The proposal does not present a concrete and transparent plan for deploying the funds, raising significant transparency and accountability issues.
- **Past Underperformance:** Previous deployments by ATMC have underperformed compared to simpler staking options like Lido or Rocket Pool, diminishing confidence in the expected yield.
- **Governance Risks:** Transferring control to the ATMC reduces the DAO’s direct influence over fund allocations, posing risks to effective governance and decision-making.
- **Modest Yield:** The anticipated yield of approximately 2.4% may not sufficiently compensate for the associated risks and potential inefficiencies.
- **Prioritizing Security and Reliability:** Emphasizing the need for secure, well-defined strategies and reliable returns is crucial before committing substantial treasury assets.

Voting against the proposal ensures that these critical issues are addressed, safeguarding the DAO’s interests and maintaining robust governance practices.

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