We understand and appreciate the rationale behind this proposal. Reaching a quorum for constitutional proposals has become increasingly difficult, and this is clearly an issue that needs to be addressed to keep the DAO functional.
That said, we believe @Tane raised a critical concern regarding the governance attack surface that this proposal may inadvertently widen.
According to @Tane’s analysis, the market value of ARB required to reach the proposed 4.5% quorum is approximately $66.3M, while the value of the DAO’s liquid treasury holdings (USD and ETH) is $57.1M. This means the cost to reach quorum is only ~$9M above the liquid value of the treasury. When factoring in the significant ARB holdings in the treasury, the total market value approaches $1B. While ARB can’t be instantly sold without slippage, this still represents an added incentive for a potential attacker.
While acquiring >200 M ARB would have a market impact and increase the attacker’s cost, alternatives like borrowing ARB do exist (as mentioned in the ARDC’s analysis of governance risks).
We’ve already seen real-world examples like Compound where governance attacks have occurred. Given Arbitrum DAO’s large treasury, it is a prime target for such threats.
As highlighted in the ARDC’s analysis of governance risks, the core problem isn’t just high quorum thresholds—it’s that these thresholds are increasing while participation remains stagnant. Over the past year, participation as a percentage of votable supply has dropped from around 8% to just 4–5%.
While we support the need to reduce the constitutional quorum to enable necessary protocol upgrades, we believe the Arbitrum Foundation and delegates should first prioritise implementing some of the ARDC’s recommendations. In particular, we’d like to highlight the following:
- Partner with vote-buying platforms to implement automatic “No” votes for proposals flagged by the Security Council or exceeding specific funding thresholds.
- Cap token transfers per governance proposal.
- Enhance Security Council oversight for high-stakes votes.
- Focus on increasing active delegated participation.
- Encourage new delegation to improve voter engagement.
In short, let’s not rush a quorum change without taking parallel steps to harden governance security and improve participation.