Ethereum layer 2 options supplier Arbitrum has backtracked on its governance voting system following community backlash from token holders.
On April 2, the Arbitrum Foundation tweeted that its first governance proposal, AIP-1, “likely will not pass” and added its “committed to addressing the feedback received from the community.”
The transfer will break up the debatable governance bundle into smaller segments. The staff famous:
“AIP-1 is too large and covers too many topics. We will follow the DAO’s advice and split the AIP into parts. This will allow the community to discuss and vote on the different subsections.”
The U-turn follows a weekend of community backlash over the muse’s “ratification” vote for selections it had already undertaken. The proposal would have given the muse, a centralized firm, management over 750 million Arbitrum (ARB) tokens price round $1 billion.
Critics, comparable to decentralized finance and decentralization advocate Chris Blec, argued the proposal was “decentralization theatre.”
I simply need to make clear:
There is NOTHING decentralized about Arbitrum or Optimism.
Just as a result of you need to use a community with out permission doesn’t imply it’s decentralized.
Both can halt the chain, modify any code, censor any transaction, freeze any pockets, or steal from the DAO.
— Chris Blec (@ChrisBlec) April 2, 2023
The basis acknowledged that the 750 million tokens obtained can be voted on in its personal AIP. “We’re working on options to add more accountability,” it acknowledged, including, “for example, a vesting period of 4 years. Furthermore, tokens held by the Foundation cannot be used to vote.”
There will even be a budgeting proposal, wherein the muse will suggest transparency studies “to make the community aware of how the funds are spent over time.”
The Special Grants program is obscure and lacks DAO involvement, the muse acknowledged. It can be renamed “Ecosystem Development Fund” with context offered on how the funds can be used to profit the Arbitrum ecosystem.
Related: Arbitrum’s first governance proposal sparks controversy with $1B at stake
The new Arbitrum Improvement Proposals can be issued “early this week,” the muse concluded.
ARB token costs took a large hit over the weekend, slumping 18% from an April 1 excessive of $1.40 to a low of $1.15 within the April 3 morning Asian buying and selling session, in accordance to CoinGecko.
ARB has seen an 86% value decline since its airdrop on March 23.
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