Non-Constitutional: Amendment to the Delegate Incentives Program

Appreciate the recognition of this debate being a value adding activity!

Not saying this is what happened here, but my experience has been that usually the delegates taking part in feedback sessions are the smaller holders, not the large ones. It sometimes takes moving things to snapshot for there to be true understanding in the positions of all delegates about a particular issue. Hope we actually see more amendments proposed (and rejected) for the program!

So after hearing the feedback, I think a floor of 50k is fine. I just think it should be a necessary but not sufficient condition to get paid by Arbitrum DAO. Ideally, we have both a 50k ARB floor requirement PLUS a 500k ARB delegate thats willing to endorse you, mentor you, hold you accountable and push you to do better.

If i remember right, one of the original intentions of DIP was that large delegates don’t have time to stay on top of Arbitrum proposals. So the money could be used to hire someone that does it for them.

For whatever reason we don’t see that happening (and yes its early but we need to think how to do this better), but i think that’s the real problem DIP should be solving - how do we get more context to the large delegates before they cast a vote? And i think giving them a pool of 50k - 500k ARB delegates to work with is a win-win for both sides. The smaller delegates get to maximize their impact by influencing how the larger delegate votes, while the larger delegate has their recruitment issue taken care of by selecting from among a fixed roster. And the DAO wins by having more accountability and mentorship as a whole

The rationale has stayed the same, even if the focus is on delivering greater value for the money rather than saving it.

which is improving the economic foundation of the program, being more comparable to other DAOs in terms of barrier to entry for full time delegate pay, and more participation that isn’t just adding noise by checking the list

high VP delegates don’t compete with the smaller ones! Anyone with over 500k ARB is default admitted to the program, as you currently have for delegates over 50k ARB.

Delegates between 50-500k ARB need an endorsement.

If they have a principled and critical view, another large delegate would endorse them. Having it as an open market reduces the risk of popularity contest dynamics to high conviction ones.

As we’ve seen from several comments, we need a higher barrier before paying new contributors full time pay! Ideally we start new contributors with part time and then ramp up to full time, rather than going there directly.

Wouldn’t this be made easier, since large delegates have to manage, mentor and hold accountable whoever they have endorsed?

Who they nominate is made public. Based on what i have currently seen, the level 1 delegates in arbitrum are not the type to sell out their credibility by nominating someone unfit for a few bucks.

My sincere apologies for the error! And for not reaching out to have a call, instead communicating remotely.

I will point out that i had a conversation with @pedrob prior to making ANY of my research into DIP public and he told me to “go ahead with the tweet.” Receipts below. I do still apologize for not taking the time to schedule a call, I generally prefer working async but that’s not everyones style.

This is a great amendment. We’d need more research on the numbers of locked vs paid ARB, curious to know what @SEEDGov thinks of this. If we want to increase power of small contributors this seems like a no brainer to have some of the amount to them locked but usable as voting power.

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To clarify, Pedro is no longer part of SEEDGov. This situation was communicated in July 2024.

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For transparency: I am a delegate, not in the DIP, but aiming to be.

My case
If the threshold had been at 500k ARB or to have another large delegate supporting me I wouldn’t have even considered it. Maybe its a female thing but I am not great at selling myself or networking around. Prior to becoming Ops Lead with the ARDC V2 I had no connections to delegates or similar - just happened to be there at the right time, with the right skills and experience.
As I am now spending a lot of time (much more than anticipated) reading through all proposals, comments, tg banter etc I figured I might as well become a part of the DIP and am trying to add my thoughts & experiences wherever it seems useful.

Compensation
Throughout the forum & tg discussions the focus always seems to be on comps - someone believing that someone else shouldn’t earn XYZ, that we are overspending on a position, whether its the DIP or certain proposals.

My take: I don’t care if you spend 3h on the forum each week or 30h if the output is the same, constructive and brings the DAO to its next level. Some people just work faster/smarter what so ever, they should be paid accordingly.

You can also view it from another angle: what is the opportunity cost of this person? If we lower our incentives who will be attracted/ and more importantly who will not be attracted anymore?

On partial contributors/work: I prefer overpaying someone doing part time, knowing that they don’t have the necessity to take up another job, hence all their brainpower will be busy with my organization vs forcing them to scatter all over.

Finally: Whoever has ever led a team will probably agree that compensations/FTEs are always the first to be cut because they are easy targets; but they are very expensive to any organization in the end. Training and retaining staff is hard, gaining context, connections within an organization as well.

I am obv not around long enough to have a solid opinion, but if the delegates program is working in a way that we are getting good contributors to work with us and the only goal of this effort is to cut costs → I am pretty sure we can find those costs to cut elsewhere (it just requires a bit more effort)

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Thanks for sharing your worms eye view of the program as a prospective applicant!

The amendments are expected to be cost neutral if every delegate over 500k ARB exercises their right to endorse a smaller delegate between 50 and 500k ARB.

So this isn’t a cost cutting exercise - more an accountability one (as larger delegates will likely endorse someone going above and beyond the call of duty) and an impact one (as smaller delegates get to influence the votes of the larger delegate who endorsed them).

This is a genuine problem to solve, as Goodhearts law means that when we make a measure like comments or votes into a target, it ceases to be a good measure. We are already seeing some negative effects from this,

I completely agree! I do still think we should be more judicious about who gets ‘overpayed’ rather than making it open to all who fulfil some criteria.

I am sure you also agree that the program is not perfect - would be curious to know if you have any proposed amendments to make it better

This one is the most interesting point. If the amendments were already in effect, I predict that after you got the ops lead role a larger delegate would have decided to endorse you. Which is good! We want there to be some rigour in selection right? And while it would be harder for you to join, once you’re in you would likely find it easier to effect change

I will move from criticism of the proposal to a constructive proposal.
You raised the issue that 50,000 should not be the only indicator for participation in the program and this is close to me.


My proposal for improvement:
It is necessary to revise the number of points for the program so that only voting and their rationale do not provide the opportunity to receive incentives.


Now you can get 70 points without taking any active part in the discussions, it is enough to vote for 13 proposals (as was the case in December) and once a month write why you voted that way.
A delegate who actively participates can receive only 10-20% more, but will spend significantly more of his time.

The second option, without changing the scoring system, is to lower the minimum amount for receiving a reward. Currently, the minimum amount is $3,000. Perhaps if we lower it to $1,000, then delegates will become more involved in the community.

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Thank you for the proposal @thedevanshmehta.

After reviewing your proposal and the feedback from other delegates, we’d like to specifically address the two proposed amendments:

  1. Level 1 delegates
    ◦ Increase the minimum entry threshold for DIP participation to 500k ARB

  2. Level 2 delegates
    ◦ Delegates with between 50k–499k ARB that wish to participate in DIP must secure the endorsement of a Level 1 delegate

This structure raises several concerns:

  1. It centralizes gatekeeping of DIP participation.
  2. It adds more complexity to an already multifaceted process.
  3. Reputational risk for Level 1 delegates becomes a factor if they endorse a delegate who underperforms.
  4. It focuses rewards on securing support rather than on the substance and quality of contributions.

We feel that implementing this structure is not constructive. Rather than centering on threshold metrics, we should focus on improving the DIP’s ability to incentivize valuable contributions and active participation across the DAO.

We agree with @pedrob that the proposed minimum threshold of ARB tokens needed to participate in the DIP seems arbitrary.

We also agree with @0xDonPepe on the points below. We’ve seen a similar effect recently with applications from various groups to run the Domain Allocator Offerings grant program, where some potential applicants were hesitant because they felt they had no real chance. The new structure you propose may have a similar outcome, discouraging additional voices from stepping forward.

We’d also highlight what @SEEDGov noted regarding the importance of skill diversity. Because the DAO manages and operates several programs and grants, having a range of delegates with different backgrounds is essential. The varied expertise of each delegate is precisely what the DAO needs to function effectively. For this very reason we need to encourage broader participation from a larger pool of talents.

We do appreciate the initiative to bring this issue forward but we are NOT IN FAVOUR of this proposal. Although we believe the proposed amendments focus on the wrong metric, conversations like this are important. They help refine how the DIP can better drive constructive engagement, reward meaningful contributions, and promote growth within Arbitrum DAO.

But we acknowledge the need to introduce accountability mechanisms to ensure we foster and reward high-quality contributions rather than simply incentivizing quantity.

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first of all, i dont agree with this solution - we would just end up with small delegates begging every large delegate for an endorsement, and i find it difficult for them to turn them down, plus you don’t want to put that responsibility on them.

i do think that arbitrum should have two separate programs, one to compensate delegates and another one to compensate contributors. on the one hand, delegates, especially those with high voting power, are the decision makers - so it makes sense to incentivize them to engage more with the DAO and ensure that they have the financial means to professionalize their delegations. then when it comes to those that are small delegates in the program, they most likely are interested in contributing to the DAO in exchange of a payment - acting more like DAO contributors rather than decision makers (realistically they won’t have that much of an impact on gov through their vp, which is fine), and they should be compensated accordingly. not every DAO contributor should be a delegate, i know this is sort of the case already, but i do think it would be better to have two separate programs to compensate each accordingly.

that way small delegates that are simply joining the program because they want to contribute to the DAO in exchange of a payment could get paid proportionally to their contributions to the DAO, without having to be delegates, and at the same time i would increase the min vp for delegates so that we keep incentivizing the DAOs decision makers to actively engage in its governance, if that makes sense.

so what i suggest is one program for delegates with a higher vp threshold (idk the number, i dont think it makes sense to arbitrarily throw a number) and another program exclusively for DAO contributors

another thing to add is that currently the threshold is actually way lower since you could in theory loop your ARB on apps like dolomite with vARB, so you could easily get 50k ARB vp with less than 30k vARB at very low risk - i did mention this to SEEDGov which i believe they are going to address this on further iterations of the program

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Would this be the case even if delegates had a limited number of endorsement slots they can give out? So its not unlimited but capped to 1, at the most 2

thanks for this intelligent insight! I definitely hope more of the smaller delegates in DIP become like @danielo , who frequently makes proposals to the DAO instead of just voting on them.

I wonder if in addition to the list of amendments, we add in “Directive Principles” which are not hard coded but suggested guidelines.

Some of the Directive Principles;

  1. We should strive to include more delegates that are exclusively focusing on Arbitrum, or at least not involved in competitor chains

  2. Delegates in the program should lock up some of the pay they receive and increase their voting power, rather than liquidating the entire portion received

  3. We should include & reward delegates who go above and beyond the call of duty, to not just checking the list of requirements in the program but also making proposals to the DAO, bullposting Arbitrum, etc

Thanks for recognizing this as a real issue within the DIP program! I also think paying similar amounts to delegates irrespective of whether they have 50k VP or 5 million is not fair.

The point @cattin raised is in the same ballpark here, about differentiating between contributors and delegates. Open to suggestions on ways we can operationalize it better.

It’s not true centralization since you can get the endorsement from any of the level 1 delegates. so its distributed permissions, which we do want when we are giving away money.

My hope with the amended structure is that only by having substance and quality will level 1 delegates will endorse contributors to join the program.

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I would be very careful with rewarding proposals (same as rewarding commenting right now). We could risk getting many poorly crafted/ill suited proposals (same issue as with comments right now). I personally rather see less high quality proposals that have been co-created by more delegates vs a floodload of poor quality.

Similarly with comments: being new I am currently spending a lot of time going through tons of comments of the same essence to get up to speed.

I have no clear answer on how to reduce this but an idea could be:
-delegates get an “area of expertise” where their proposals and comments “count” towards the DIP
-other topics need to be read but not necessarily be commented on (during elections a rational needs to be provided)

In a way this is closer to “employing” them in a vertical.
Example: XX is an expert in business development/new ventures. She gets points for creating new proposals (more if it is together with others) in her area, for commenting, even more points if the proposal passes on Tally etc. She can comment in other domains but is not a domain expert (aka everyone knows that as well).

Like this we could maybe :
-get less but more high quality comments
-structure the DAO along knowledge domains

Endorsements idea is interesting. What if someone endorses their friend just to take a fee on their earnings? Let’s try it, maybe it will bring in some new blood. If every delegate onboarded 1 new contributor we double to people moving the DAO forward. Seems positive sum to at least try this for a season, we need more experiments like this.



The DAO does not serve ARB holders solely, it serves the network participants as well. I’ve spent the last 3 years building apps on Arbitrum and my entire life’s pursuit is dependent on the success and security of the Arbitrum network. Am I not aligned? I am not rich and do not have $250k in crypto, but I care about Arbitrum winning much more than many holders I have talked to. Please understand who the DAO serves and the builders who rely on it.

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There are so many good comments already that we try to keep it brief. We would be against this proposal, while also agreeing that improving the DIP process is always a good idea.

Echoing the sentiment of others, we think that the current incentive structure leads to a deterioration of comments. We’d be in favour of simplifying the requirements.

What’s more useful to the DAO? A delegate that adds to the collective workload by repeating other people’s ideas in every thread to be rewarded, or a delegate who only posts following an intrinsic motivation to do so, e.g. to contribute a new perspective or emphasize their conviction?

On a high level, what is the one thing that the DAO wants to achieve?
In our opinion: to make (good) decisions.

This means, voting is the single most important action and primary responsibility of a delegate.

A vesting schedule is a proven method of incentive alignment and we’d support this greatly.

Further, our understanding of the DIP is that only the top 50 delegates can participate.
While this is not a tangible limit to participation currently, it will inevitably push the minimum delegation amount significantly upwards of 50k ARB as more delegates join over time.

With this perspective in mind, we think that the DIP should not be more complicated than it is now, and in fact should be further simplified by deleting all requirements that create distracting incentives, such as paying for forum activity.

I did stay out of this discussion so far on purpose in the beginning. We did talk a lot about the DIP in the chat, here, in private, and in public. I have to say comms have being a mess and detrimental for the DAO in my opinion on this topic.

First, a few bullet points on this very proposal.

  • in this topic we only focus on the bad of a low entry point, 50k arb. I would have not been personally able to enter without this. My current delegation is half what I racked around (thanks to @dk3 for bootstrapping it) and half what i auto delegated. I think this could be said for a lot of other very good delegates with low VP
  • there is a general erratic behaviour of first suggesting an increase delegation up to 500k arb, then move to an endorsement process, then move to different programs based on the amount of VP. All of these are neither good nor bad solutions per se: but they have been clearly thrown around without a proper analysis of the current state of DIP. Saying you need 500k to post on snapshot is not a reason good enough to be clear. So I don’t think neither the 100k/500k/1M/whatever is a solution, nor the endorsement from a big delegate
  • DIP can be improved for sure. In searching for quality we have created a program in which everybody and their grandma has to write their take on X because this accrues points. Byproduct is that it creates a lot of noise, and it becomes blurry to distinguish between comments sometimes written for the sake of writing, and comments that are just a different opinion.

We should go back to the roots: what was the DIP created for, did it provided a proper solution, did it create further issues.
DIP was created to increase participation in the DAO and to also sustain delegates that have to spend a big amount of time in here. But, useless to say, is extremely more likely that a delegate with millions in voting power will have an higher impact (keyword) compared to a lower one.
When can a lower VP one create an impact? When is able to steer opinions of the DAO, is able to provide feedback that gets incorporated, and creates secondary effect that are hard to measure.
Does it happen often? No. Does it happen? Yes, I see this secondary impact from several delegates, to name a few @jameskbh and @pedrob but they are not the only ones.

The DIP did create a net to sustain high VP delegates, to give them a reason to spend time here and in the calls, and to constantly put their voting power to use. The DIP also gave enough motivation to low VP delegates to put enough energy to create non tangible but important effects. The DIP also attracted a series of delegates that we will see in future if they will provide any meaningful impact, but that in the meantime are also creating detrimental noise.

To me, the high level answer is evolving the DIP toward a program that is more skewed toward impact.

What is impact? Is the ability to have a meaningful effect.
Inheretely means that the practical definition of impact will change based on the state of the dao, of our chain and of the crypto industry as a whole, and will be a fluid definition.
We are coming for example more and more close to a situation in which impact is being able to address the always rising quorum.
Does it mean that for example compensation should partially be tied to the voting power accrued? Maybe.
Does it mean that if I am able to come, as a old 50k delegate (or new delegate) with a new delegation of 1-2M arbs that were not previously delegated I should get a bonus? Maybe.

I don’t have the precise answer on how to make DIP better right now. There are likely infinite ways, each one more skewed toward one specific outcome that we all want more than others, so all with certain pros and cons. Any change will come with people that will protest around it, and others that will be satisfied.

But if we don’t first assess the goals we had, whether they were reached, and what challenges we have ahead as a collective, all that we are discussing will be nothing more than virtue signaling, allowing ourselves to look in the mirror in the morning and tell ourselves how good we are as crypto native people, how we are allegedly changing the reality around us, while, in fact, we are just going in circles in a small world that is becoming more and more detached from the reality of any business.

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After reading the proposal and comments from other delegates, I want to share my thoughts and ideas.

How a 10x magnification can lead us to an increase economic foundation of the program, create a better environment for organic participation? The DIP has not even reached the 100 active members which it wanted to recruit for its participation.

Based on this, we need to think not about increasing the limits, but rather narrowing them so that new participants can get into the DIP. We need at least 100 active participants so that there is healthy competition, otherwise the program participants will degrade due to the lack of new ideas and the laziness of the participants due to a lack of motivation to do anything, since there is no competition.

Further, such a division into first-class and second-class delegates undermines the foundations of equality of all participants in the DIP as such. I also want to note that this will lead to abuse and nepotism, when first-level delegates will recommend their friends or relatives as second-level delegates and rank them higher than third-party delegates with the same indicators. And this, in turn, will only harm the DAO and the DIP.

Next you write that:

As I already described above, we have a shortage of delegates and, in turn, a shortage of comments. You are now saying that there are too many empty comments, even when we do not have 100 participants in the program! This sounds very strange. On the contrary, we need more new ideas and statements.

Further, increase in limits and dividing delegates into castes will not lead to an improvement in Organic Participation. It seems to me on the contrary, this will lead to a decline in creativity and laziness due to the lack of competition.

Empty comments for show’s sake need to be dealt with differently. The idea occurred to me that we need to make it possible for each delegate to comment on each proposal only once. This will lead to the fact that each participant will think about what to write, saving other participants from unnecessary second, third, and so on comments from the same delegate about the same proposal.

Something like this. I don’t want to offend anyone here. Just my thoughts.
I am a small delegaor, just in case :slightly_smiling_face:

Even if it’s distributed amongst a set of L1 delegates, it’s still viewed as a centralization of sorts. It’s a similar power structure in most corporates or even governments.

There is the possibility that what is expected is not what happens in reality and needs to be taken into account. Currently we’re more for an approach that considers the value of contributions (not frequency) as a way to filter delegates that should be rewarded.

We believe that we’re aligned in the desired end goal but are taking different approaches.

The following reflects the views of GMX’s Governance Committee, and is based on the combined research, evaluation, consensus, and ideation of various committee members.

As mentioned by others this proposal severely undermines the presence and emergence of new delegates into Arbitrum ecosystem. With a reduced actively engaged delegates, it limits perspective, centralises control amongst few delegates, and creates a larger barrier to entry for the average participant wanting to have their voice heard.

SeedLATAM has performed an exceedingly decisive effort in order to filter upstanding quality reviewers amongst the DAO. The provisional encouragement of incentives is advantageous for attracting a diverse set of opinions.

Giving consideration retrospectively, it’s very clear how participants in the DIP, have further enhanced discussions. As mentioned by @SEEDGov, another consideration is if a small delegate doesn’t align with Level 1 delegate preference, it may be weaponised and generate a wrong outcome. It can create conversations out of periphery of what is most pragmatic for the DAO and the ecosystem as a whole.

Our overall opinion is against seeking this proposal, we do recommend a revised examples with both qualitative and quantitative metrics to effectively outline if there’s a necessity in ammendments to the DIP.

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Thanks for the engagement! At this point I will not be taking the proposal to a vote, given my new role at the Ethereum Foundation and the pushback on the proposed solution. I thank all for engaging with this post and hope the comments feed into a better version of the program.

Employing delegates in a vertical (h/t @tamara ) so there is no need for proliferation of comments without insight, a vesting schedule (h/t @Griff ), moving from output based compensation to outcomes & impact (h/t @JoJo ) , rewarding delegates more active in only arbitrum or at least not involved with competitors(h/t @paulofonseca ), and differentiating between delegates with high VP & contributors giving their time (h/t @cattin ) were some of the concrete solutions proposed.

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