Blockworks Research will vote AGAINST this proposal on Tally.
First of all, we appreciate the updates made to the proposal posted onchain. Having said that, as many have pointed out, there are still several concerns that haven’t been addressed adequately. From the point of view of growing the Arbitrum ecosystem, we feel that there is no robust argument for running an additional incentive program on top of the LTIPP. As such, our opinion is that the currently optimal action for the DAO is to better understand past incentive programs to create an even better framework, which can be implemented once the LTIPP has ended. To be clear, we fully support incentive programs, but they have to be implemented in a manner that balances growth with sustainability.
More specifically, in addition to the points raised in our previous comment, some of our main concerns comprise:
- Almost no STIP applicant rigorously justified the number of tokens requested, with the STIP-Bridge building on this arguably somewhat arbitrary allocation. We’ve screened several STIP addendums, and no applicant has quantifiably validated their grant request.
- The optimistic voting structure is interesting but should be accompanied by a council (similar to what was utilized in the LTIPP), at minimum. As no in-depth research covering the performance of all STIP recipients has yet been published, community members would be forced to conduct due diligence on each applicant’s performance themselves, in addition to assessing all STIP addendum structures. The aforementioned, combined with an extremely short challenge and review period, means that several undeserving protocols and incentive mechanisms are likely to pass.
- We’re especially concerned about the possibility of an extension that is included in the STIP-Bridge proposal. It’s clear that it isn’t sustainable for the DAO to indefinitely hand out incentive allocations, and since the extension will be posted directly to Tally, it’s unclear how framework improvements would be added to this extension and who would be responsible for deciding the next incentive program’s structure.
- The longer-term sustainability and user retention of the STIP are not yet understood, and running an extension of the aforementioned incentive program renders it impossible to research these factors.