A Vision for the Future of Arbitrum

[jameskbh]

Thanks for the update/clarification on the vision.

While I’m overall supportive of this specialisation path, I would like to add a few comments/suggestions.

The proposed setup with the AAEs is the following:

@Arbitrum

• Arbitrum Foundation. DAO legal wrapper, Marketing, Education & Technical Advancement, Community, and Strategic Growth and Grant Initiatives,
• Offchain Labs. Engineering, Product, Business Development and Technical Research, Contracted Service Provider to Foundation,
• OpCo. DAO Control Panel, Operations, Coordination and Governance,
• Gaming Catalyst Program. Arbitrum Gaming Investment and Grant Arm,
• Entropy Advisors. Strategic proposals, shepherd key partners through the DAO, align essential stakeholders, data analytics, DAO financials, and late-stage ecosystem support.

And borrowing @Entropy’s image from their SOS submission, the expected/proposed relationship is the following:

In my view, this resembles a company/entity with a well-defined R&D department, comms & marketing, Data & Finance, an Investment arm (focused on gaming), and an admin structure to be built (OpCo). And I see two issues here:

• The way we have it now is like those departments are outsourced, in a way that there is no direct relationship between ARB tokenholders (or delegates) decisions and the AAEs. The AAEs will have the autonomy even to refuse to work on a proposal approved by the DAO (more about it below). The envisioned structure proposes that the AAEs drives/gates the evolution/development of the DAO (and Arbitrum itself) while the OpCo acts as a bridge between the DAO and the AAEs. I could delve into more details, but outsourcing would reflect the gist of it. This is a consequence of;

• A lack of a formal coordination role (It can be, or should be OpCo), in the sense that the other structures are hierarchically subordinate to it. This produces a power imbalance in the relationship between the DAO and the AAEs, reducing the checks & balances between them.

Using this as an example, there is an SOS submission about focusing on institutional entities. What happens if the DAO approves this proposal and no AAE supports it? How would this proposal move forward? While having, in theory, the manpower and the knowledge to execute it, today, if the AAE does not believe this is the way to go, there is no straightforward way to “enforce” its execution, which will increase the friction and the inefficiency within the DAO (in a way that is worse than what we have today).

@Arbitrum

We expect that delegates will largely listen to the feedback of the OpCo and relevant AAEs and will generally dismiss proposals that are not endorsed by those working for Arbitrum in that area. Of course, if the DAO is adamant that a proposal should pass, then the current proposal process still exists to permit that to happen. It will be up to the OpCo to hold the proposal’s author accountable and ensure it is carried out. This should only happen in exceptional cases and not as standard practice.

If, for any reason, the DAO ultimately approves a proposal, then they have to come up with a way to execute it. This is an example of outsourcing and a lack of hierarchy that may hurt Arbitrum in the long run (and we are at the right time to discuss this).

TL; DR: While the proposed vision is a way to move forward, I would prefer a setup where it is clearly defined at any other AAEs are subordinated to OpCo, at least operationally, as it will be the DAO’s representative. IMO, it is a step further than what is mentioned here:

@Arbitrum

The OAT, alongside the OpCo, can work with the Arbitrum Aligned entities to:

• Recommend that a proposal should progress through the DAO,
• Decide on the operational and execution details of a proposal,
• Require regular updates from the Arbitrum Aligned Entities on whether the proposal is progressing as anticipated,
• Authorise pivots as long as it retains the spirit of what the ArbitrumDAO approved,
• Cancel a DAO initiative that is not making satisfactory progress,

Since the OpCo is the living fabric of the DAO, it can act as a quick authoriser to help teams pivot their operational plans for how to execute a DAO-approved strategy which is useful in many cases to avoid delays, bottlenecks, and continued work down the wrong path simply because it is exactly what the DAO approved.
Additionally, we expect the OpCo, OAT and, depending on the structure of the AAE, potentially a collective of other stakeholders (e.g. GCP) will decide a proposal should be cancelled and remaining funds returned to the DAO. This is because the OpcO and OAT will gain access to information that is typically difficult to release publicly. As well, there will be a dedicated team whose job is to keep track on how a proposal is progressing alongside all the context surrounding it to date. They will be in a very strong position relative to the DAO to make judgements on whether a proposal was successful or failed.