Another month of the ARDC concluded, and here’s what we’ve been up to, and what is currently on our plate.
Deliverables
STIP Retroactive Analysis – Spot DEX TVL — by Blockworks Research
In the context of their retroactive analysis of STIP, Blockworks conducted research and put together a report focusing on how the STIP impacted trading volumes in the spot DEX vertical. They employed a Synthetic Control approach to isolate the program’s effects from broader market trends.
STIP Analysis of Operations and Incentive Mechanisms — by Blockworks Research
Blockworks put together a report that presents an overview of the final STIP fund allocation across different incentive mechanisms. The report focuses on differences in growth trends and their sustainability for perp DEX and spot DEX protocols while comparing activity on Arbitrum against other relevant ecosystems.
Arbitrum DAO Treasury Research — by Delphi Digital
After originally being requested by Entropy Advisors, Delphi Creative conducted research and published a memo on the Arbitrum DAO treasury. This report aims to quantify the DAO’s expenditure thus far and estimate its impact on ARB secondary markets.
ETH Staking Options and Risks for the DAO — by OpenZeppelin
OpenZeppelin put together and published an overview of staking options, the risks they each have, and possible ways the DAO could stake its ETH reserves. Their recommendation is gradual investment into a regularly-rebalanced, diversified portfolio of LSTs actively managed in a DAO Treasury Management Vault to minimize trust and mitigate centralization while enabling adaptability to changing risk tolerance and market conditions.
Event Horizon Franchiser Contract Audit — by OpenZeppelin
Following Event Horizon’s success in temp-checking their proposal, we assigned OpenZeppelin to conduct a formal security review of their franchiser contracts before their proposal goes to an on-chain vote. The review findings can be found here.
STIP Analysis | Insights & Key Findings — by Chaos Labs
Over the past ~ three months, Chaos Labs has conducted three separate case studies to analyze the STIP from a risk perspective. Following the case studies, they drafted and published a post that focuses on aggregating the learnings from these case studies into a consolidated review to help delegates and protocols improve their decision-making in the future.
Risk Analysis of Adjusting the Minimum Base Fee on Arbitrum — by Chaos Labs
Following a request by Entropy, Chaos Labs conducted and published a comprehensive data-driven analysis of the likely implications of increasing the Arbitrum minimum base fee. As noted in the analysis, the likely short-term increase in revenues from the increase will come at the expense of growth in gas usage. Growth in gas usage will have a significantly larger effect on revenues over the medium to long term, and it does not make sense to put this at risk while blockchains are still so early in their development cycle.
ArbOS 31 “Bianca” Proposal Review — by OpenZeppelin
OpenZeppelin was assigned to review the AIP: ArbOS 31 “Bianca” proposal and its execution instructions. In the review they published, they noted that they expect this proposal to execute correctly if it passes. One thing they highlighted is that during their review, they found some involved contracts that had been refactored, and they were unable to confirm that the RewardDistributor contract was audited. OZ’s recommendation is that the Foundation describe these contracts in detail so that the community can gain trust in them.
STIP Retroactive Analysis – Sequencer — by Blockworks Research
Following their retroactive analysis of the STIP per vertical (see above and previous updates), Blockworks Research attempted to analyze STIP’s impact on Arbitrum’s sequencer revenue. Their findings show that 43% of Arbitrum’s revenue between November 2023 and the Dencun update was attributable to the STIP, with $15.2M recouped from sequencer revenue against the $85.2M spent.
Current ARDC Work
A high-level overview of the work that is currently on the plates of the members of the ARDC is as follows:
Blockworks Research:
- Treasury Backed Vaults Analysis - due diligence and research recommendations.
Delphi Digital
- Research on the creation of a DAO Budget.
- Creation of an income overview to inform the creation of a DAO Budget.
OpenZeppelin
- Tally’s expansion audit
- Treasury Backed Vaults Analysis - Security Consideration (backburner)
- Timeboost proposal technical breakdown (backburner)
Chaos Labs
- Treasury Backed Vaults Analysis - Risks associated with the DAO using CDP protocols
- Risk analysis of the governance parameters (backburner)
- Timeboost proposal analysis in the backburner
We want to remind you that anyone can follow along with the progress of the ARDC’s work in our Notion Dashboard.
Requests for the ARDC
- @Harshkumarjadon requested that the ARDC explores zkTLS opportunities.
- After discussing the request, we decided that the ARDC will not be undertaking the task of exploring zkTLS opportunities as there’s currently no capacity for an additional workstream, and there doesn’t seem to be an appetite from the DAO for such an endeavor.
Call to Action
We want to remind delegates that the ARDC is here to support the DAO and the work delegates are doing, and it’s at their disposal under the direction of the DAO Advocate. To that end, there’s a biweekly call every other Monday at 12 pm UTC. You can find the link for it in the Arbitrum Governance calendar.
In addition, we invite delegates to reach out to us (L2BEAT) in our capacity as DAO Advocates if they have topics in mind that they believe the ARDC should be assigned to. To that end, we are available at the biweekly call mentioned above, on Telegram (Krzysztof & Sinkas), and during our L2BEAT Arbitrum Office Hours every Thursday at 3 pm UTC.