The Arbitrum DAO has approved an enhancement proposal from the community to lock 700 million ARB tokens worth $770 million in acquisition deal. It will gradually release funds to the Arbitrum Foundation over a four-year period.
Why Arbitrum blocked 700 million ARB tokens?
The DAO or Decentralized Autonomous Organization of Arbitrum has locked up 700 million ARB tokens with a total value of $770 million at the time of writing in an acquisition agreement. Blocked funds will be gradually donated to the Foundation over a period of four years. This is a major step for the DAO towards accountability and transparency in governance as indicated TheBlock.
The decision comes after the approval of the AIP 1.1 proposal. Indeed, it was adopted amid a period of controversial governance within the Arbitrum ecosystem. The project faced significant backlash over a “special grants” program. The initial objective was to allocate more than 700 million ARB tokens directly to the Arbitrum Foundation. According to the foundation, the funds would be used to support initiatives based on Arbitrum’s technology.
At the time however, the allocation scale was too huge since it was worth over a billion dollars at the time. It front of concerns about transparency of this project designed to make collective decisions, a subsequent proposal to return Foundation funds to the DAO was adopted. But, she had recorded a rejection.
A breakthrough in terms of CAD?
Arbitrum is a layer 2 scalability solution for Ethereum. Offchain Labs, its developer, has set up this solution to deliver scalable, low-cost smart contract capabilities. Thus, its director DAO makes decisions by proposing and voting on various initiatives. These are known as Arbitrum Improvement Proposals.
One such proposal, called AIP-1.1, was intended to address community concerns by implementing strict control measures on the allocation of DAO cash. It therefore gives the DAO the power to modify the vesting period.
In short, the power conferred on the DAO allows it in particular to prolong, shorten or even stop the acquisition process. Should other projects be inspired by this management method for greater transparency?
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