The following reflects the views of L2BEAT’s governance team, composed of @krst and @Sinkas, and it’s based on the combined research, fact-checking, and ideation of the two.
We’ll be voting FOR this proposal.
First, we would like to state that we had a very good experience working with Entropy so far and that we believe their services are a value-added to the DAO. However, we were initially hesitant to vote in favor of the proposal as we found the requested amount to be fairly large and couldn’t see a reason for the 10-person team that was outlined.
To better assess their request, we looked for similar benchmarks in the industry to compare it to, and we concluded that it would be a good idea to compare Entropy’s proposal with Optimism’s Grants Council — an entity we have personal experience with. Although it’s not a direct comparison since Optimism Grants Council (OGC) has a well-defined and narrow scope, while Entropy’s proposal is more open-ended, and its scope is rather loosely defined.
As things are, the OGC is running point on the operations of Optimism’s grant program, it’s writing mission requests, reviewing mission proposals, and assessing the results of the completed missions. While not exactly the same, we find the scope of work quite similar to that of Entropy’s work as outlined in the proposal.
OGC is now comprised of 12 mission reviewers, 3 milestone and metrics reviewers, 2 audit reviewers, and a lead, with a budget of 610,000 OP (~$1M) for 6 months. Given Entropy’s request is for more than double the duration, we find the amount requested reasonable by comparison. It’s important to note, though, that the comparison doesn’t guarantee that Entropy’s proposal and subsequent work will be successful. It simply goes to show that a similar structure proved to work well in a different ecosystem, and therefore, we’re willing to give it a chance.
With that in mind, we would like to make it clear that we still believe the amount requested is on the large side, and therefore, our expectations for Entropy’s performance are also high. The way the proposal is structured, Arbitrum’s DAO is basically bootstrapping Entropy’s company as an independent consulting agency, covering all costs and taking up all associated risk, while the ‘only’ benefit the DAO receives is 1-year exclusivity, with a possible extension to 2-years of exclusivity depending on the approval of the bonus and compensation structure.
Given the structure, we think it would be sensible for the DAO to perform a business justification check halfway through the engagement (6 months after an on-chain vote passes) to see whether Entropy is meeting the expectations.