Arbitrum Community Proposes $1B Token Return to DAO Treasury
- The community member believes that this action would symbolically show that the governance holders have the ultimate control over the DAO
- According to the proposal, The foundation has unilaterally been allocated $750M tokens from the DAO that the governance stakeholders did not approve
In response to the Arbitrum Foundation's unauthorized transfer
of funds in March, the Arbitrum community has suggested that the Foundation replenish 700 million ARB tokens to its DAO Treasury.
According to the proposal, the Arbitrum Foundation must restore 700 million ARB tokens to its DAO Treasury before following its budget plan. The community member believes that this action would symbolically show that the governance holders have the ultimate control over the DAO, not the Foundation or the Arbitrum service provider.
Voting for the proposal will conclude on April 14, with 55% of voters currently in favor of the proposal, 42% against it, and 2% abstaining. The dispute between Arbitrum's foundation and the community began towards the end of March after the first governance proposal (AIP-1), which aimed to fund its operations with 750 million ARB tokens, equivalent to nearly $1 billion.
The foundation responded to community backlash in a forum post on April 2, stating that AIP-1 was a ratification and not a proposal and that some of the tokens had already been sold for stablecoins. The Foundation recognized that its initial governance effort, which was meant to be symbolic, was unsuccessful due to issues with communication and indecisiveness.
Several days later, the Arbitrum Foundation introduced a new set of proposals to improve community dialogue. AIP-1.1 focuses on smart contract lockup schedules, spending, budget, and transparency, while AIP-1.2 addresses amendments to current founding documents and reduces the proposal threshold from 5 million ARB tokens to 1 million ARB tokens to make governance more accessible.
Despite these efforts, the foundation still needs to resolve issues with ARB holders. According to the proposal, The foundation has unilaterally been allocated $750M tokens from the DAO that the governance stakeholders did not approve. The proposal states that all funds must be returned until the DAO has allocated them properly and solely by the DAO.
