Arbitrum to break up governance votes after community backlash
Ethereum layer 2 solutions provider 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 move will break up the debatable governance package into smaller segments. The team noted:
The u-turn follows a weekend of community backlash over the Foundation’s “ratification” vote for decisions it had already undertaken. The proposal would give the Foundation, a centralized company, control over 750 million Arbitrum (ARB) tokens worth around $1 billion.
Critics, such as decentralized finance (DeFi) and decentralization advocate Chris Blec argued the proposal was “decentralization theatre.”
I just want to clarify:There is NOTHING decentralized about Arbitrum or Optimism.Just because you can use a network without permission doesn’t mean it’s decentralized.Both can halt the chain, modify any code, censor any transaction, freeze any wallet, or steal from the DAO.
The Foundation stated that the 750 million tokens received would be voted on in its own AIP. “We’re working on options to add more accountability,” it stated before adding, “for example, a vesting period of 4 years. Furthermore, tokens held by the Foundation cannot be used to vote.”
There will also be a budgeting proposal, in which the Foundation will propose transparency reports “to make the community aware of how the funds are spent over time.”
The Special Grants program is vague and lacks DAO involvement, it stated. It will be renamed “Ecosystem Development Fund” with context provided on how the funds will be used to benefit the
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