Hi all, given the Foundation’s response concerning the ADPC, we thought it was important to respond and clarify the facts.
In regards to the Foundation’s proposal, it needs to be mentioned that we shared a detailed proposal for continuing the Subsidy Fund — including a proposed $10M fund size and other specifics, such as a detailed scope — with the Foundation a week prior to their announcement to internalise the extension, and discussed it with them until the day they posted this Audit Program proposal.
We had also spent several weeks educating the Foundation on the operation of the framework, including a session in Bangkok with the core members of the team to walk through the tasks involved in running such a procurement framework and fund. On the basis of the feedback during that session, as well as strong support from the community, the industry and project teams involved in the initial 8 week run, we concluded that the ADPC was best placed to manage this for the DAO and prepared a proposal to submit last week.
The Foundation promised to get back with feedback, but instead posted this proposal by themselves without informing us. At no point in the past 12 months did the Foundation raise any concerns with us about ADPC operations, timeliness or cost effectiveness despite us having near daily communications with them. We strongly believe that the Foundation is a key stakeholder in the operation of the DAO and wanted to ensure they were not blindsided by any work being undertaken by the ADPC as poor communication between us could result in the DAO being ambushed by events. The ADPC is proud of its exemplary professionalism shown to date and are deeply troubled by any implications suggesting otherwise.
In summary it is incorrect to state that the DAO would not have had another subsidy fund - this was, in fact, on the horizon and we had planned on posting it imminently after receiving the Foundation’s feedback which, in the end, we never received.
We can discuss what it means to work for a DAO, the associated costs, and how pricing is determined among various stakeholders. However, we would have appreciated a more transparent communication process from the Foundation.
Respectfully, we can understand a business decision of wanting to run an ecosystem like a corporation and not a DAO. This is not what we are arguing against.
We, delegates, and other service providers have contributed to the ecosystem, effectively taking a bet on its success. This also means working together in a partnership. We understand the Foundation’s decision to internalise the DAO and its key initiatives run by service providers and would only ever want them success in continuing the innovative procurement models designed by the ADPC team.
More broadly, we think the Foundation’s expertise and resources (which the DAO has significantly funded) could be better utilised in spinning up programs that are not already tackled by contributors vs. going on a hiring sprint to internalise these functions.
Considering the history of the DAO and involvement of its participants (delegates and service providers) who have spent 2 years to try to get this experiment right, our strong preference is a continuation of the direct communication we had had with the Foundation until very recently as this shift by the Foundation to internalise a proposal that external contributors had been working on (and that the Foundation were aware of) could have resulted in a more streamlined approach and more seamless transition planning. The current approach is sub-optimal for the DAO, and we believe other delegates and ecosystem participants would tend to agree. The ADPC remains prepared to work with the Foundation on the understanding this can be done with mutual respect and transparency.
This is not an effort to challenge who runs the program, we are happy to support the transition to make sure the value we created is not lost, if the push to internalize continues.
Rather, we hope the Foundation will reconsider its overall communication and collaboration approach.
Otherwise, we are concerned it may lead to the offboarding of other remaining DAO contributors and delegates, who have long been the core of the ecosystem - as this is not how partners should be treated.
Find below responses to some of the statements:
The first step towards running the subsidy fund was creating the procurement framework for whitelisting security auditors for the DAO. As we mentioned in the Phase I Outcome Report, we began operations for ADPC Phase I from February 21, 2024, while the RFP process to whitelist auditors took place between June 19 and July 22, 2024.
During this period, the Foundation took more than a month to get back to us on our proposed framework (as mentioned in the Phase I Outcome Report), and ultimately told us that the legal terms would be redundant due to the Foundation having its own preferred model. This introduced significant delays into the process.
Moreover, the ADPC was ready to begin the Subsidy Fund even earlier and we announced the whitelisted security service providers in August - another month’s delay took place since the providers had to undergo KYB and sign the Head Agreement with the Foundation.
The ADPC took this feedback into consideration early on and onboarded DeDaub as a technical expert. This was based on feedback from the DAO and actioned immediately. DeDaub was funded for a total cost of 12K ARB, which we think is very fair for a technical party of their calibre.
If the Arbitrum Foundation preferred to use technical members at the AF to sense-check audit proposals, we would have been happy to implement this feedback had this been communicated to us.
Regardless, we think engaging a third-party audit expert as an impartial referee makes much more sense than involving technical AF members who do not have a keen view into the dynamics of the audit market.
This is not correct - the Foundation did not review a single application or was in any other way involved in the selection of projects. The Foundation was only involved in (1) an investigation of potential malicious behaviour (as they are the legal counterparty) and (2) aligning with ADPC on adherence to legal terms (as they are the legal counterparty).
For further questions, we will join the office hours later and then plan to refrain from further comments.