AIP-1: Arbitrum Improvement Proposal Framework

SEEDLatam Statement

Hey everyone,

@cattin here, representing SEEDLatam and L2 en Español, after discussing this AIP with our community during our first governance call carried out in our Discord, we decided to vote AGAINST AIP-1, for the reasons stated below.

Rationale

As a self-sustaining organization that encompasses other communities, each with different interests, we understand how difficult it is to have clear communication in these scenarios where there is a lot to do (airdrop, forming the DAO, maintaining decentralization, etc.), nobody said that running and forming a DAO was an easy task.

Therefore, we want to thank @stonecoldpat for his post “Clarity around the ratification of AIP-1” which brought more clarity to what is happening in ArbitrumDAO to our community.

However, this does not remove the great dissatisfaction of the community that was expressed during our governance call regarding this situation. Additionally, we believe that AIP-1 encompasses several proposals together which should be voted on and dealt with separately, as it has already been recognized in the latest statement made by Arbitrum on twitter.

While we understand that this is not now a “proposal” but rather a “ratification” of the initial DAO configuration, we will express the will of the Latam community on each point.

On Special Grants

We believe that this point is very vaguely explained, although it is clarified that the Special Grants process and criteria will be published in the future, we do not believe that voting for this point now is correct.

Establishing the scope of these Special Grants and the processes we believe is crucial, as these are funds intended for organizations/institutions or individuals who have somehow helped or supported the Arbitrum ecosystem. We believe that transparency in the processes and that those funds truly have an impact that benefits the Arbitrum ecosystem is really important.

On Directors

We understand that at this point there is a legal and regulatory margin that is beyond our reach and it is necessary for Arbitrum Foundation to assign its board.

However, we would like to have more information regarding the names mentioned before proceeding with this proposal or at least for Offchain Labs/Arbitrum explain why these directors where elected, with some background about them. Also, these directors could introduce themselves in the forum as such, explaining what’s their background, what relationship they have t0 Arbitrum/Offchain Labs, etc. It is important to maintain trust among all parties that make up Arbitrum DAO, the DAO as such has the right to know who is behind this Foundation and why they were appointed.

On the Security Council

On this point, there’s nothing we would really change, just congratulations to Patricio Worthalter for being part of the Council, since he’s pretty close to our community and an important voice from our region. Our community members are big fans of POAP, and we are proud that this attestation tool has emerged from this side of the world!

On the Data Availability Committee (Arbitrum Nova chain only)

Regarding the Data Availability Committee, we would like to have more clarity on the selection criteria of each member and their relationship with Offchain Labs.

We also believe that it is necessary to vote on a removal or appointment process, just in case there’s a scenario where one member should be replaced, such as what happened last year with FTX.

On The Arbitrum Foundation Administrative Budget Wallet

This is what has generated the most debate and dissatisfaction, on the one hand, it is not an exorbitant amount for a DAO Foundation since they have to pay administrative costs and grant funding as mentioned earlier. On this point, our community is completely in favor of the Foundation being funded, and we don’t necessarily have any issues with the amount requested. The problem here, as mentioned earlier, is communication.

We consider that it’s too risky to have 7.5% of the total supply on a multisig, we know this is unlikely to happen, but after what happened with Ronin we don’t think we should run the risk. This allocation should be distributed gradually, and discussed in a separate proposal, with proper guidelines on how these funds are going to be used and what roles would the directors have in all of this. The main issue we had, as a community, is the way that arbitrum carried this out, doing first and asking for permission later. Even if it was just a “ratification”, then at least they should’ve been transparent since day 1 about the Foundation’s wallet being funded at the time of the distribution and regarding funds going to a market maker, which again, we don’t see an issue with this, but we simply don’t understand why couldn’t this be communicated openly in a transparent way.

So how should we proceed?

To fix this error and due to everything that has happened during this temperature check, we believe that if the proposal is rejected, Arbitrum should take another approach, go point by point, and have it voted on by Arbitrum DAO.

Conclusion

Our community is convinced that we are in time to remedy the first misstep that Arbitrum has taken. On the other hand, we are also pleased with the general reactions, we believe that this type of situation is always good for progressing as an ecosystem, we are in very early stages and it’s better to make these mistakes now than later.

Finally, we want to thank our community, more than 60 members showed up to our governance call, and also thank you to our contributors and delegates @axlvaz_SEEDLATAM.eth @Manugotsu_SEEDLatam @SEED_Latam_Joxes @Phenrril @Noa and @ArbiGod.eth for participating and helping us form this statement. Any member of this DAO who wants to participate in our governance calls and open to discuss Arbitrum-related topics is welcome.

Also, if you want to watch our first governance call click here.

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