[Non-Constitutional] [RFC] Arbitrum D.A.O. (Domain Allocator Offerings) Grant Program - Season 3

Thanks, @JoJo, for this proposal.

I think adding a new Orbit domain is an exciting idea, but since Orbit domain is still new, it makes sense to start with a smaller budget.

I understood, that it’s not $1 500 000 for the whole year like four other domains, but instead of giving the Orbit domain $750,000 for the whole year, it would be better splitting the funding into more steps, because starting with a smaller amount helps the program avoid wasting money while still supporting Orbit’s growth.

For example, we can split it into to steps:

  • First Half of the Year: Start with $375,000 for the first six months. This will give enough funds to test the interest and quality of Orbit projects.

  • Review and Adjust: After six months, take a closer look at the results. We can check how many projects applied, how well they used their funds, and if they achieved their goals. And then based on this:

    • If Orbit projects are doing well and show strong potential, the remaining $375,000 can be added for the rest of the year.
    • If the results aren’t strong, the leftover money can go to other areas of the program or be saved for future use.

Do you think it´s not a good idea? Because in this way, we can test how effective this domain is before spending a larger amount of money.

By the way, during the first season, we had budget only $250 000 per domain. Maybe for the new one Orbit domain (because for the Orbit it will be the “first season”), we can also allocated the same budget and then split it into steps, which I described earlier?

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Сan we also attend the calls? Or we will only have access to the recording?

The main problem is that is unlikely that there will be any meaningful result to evaluate in the first 6 months: grantees that apply have, technically, up to 6 months to complete their application, we might just not have the instruments to make this evaluation. I am fairly sure it was mentioned somewhere in this long discussion.

In the first season the cap was $25k, while in second and in the now third will be $50k. $250k means you might just pass 5-7 proposal, and then run out of funds.
Honestly I think the compromise above (1 year, half of fundings of other domain) is good enough, especially because a lot of folks advocated to have full allocation in orbit: quite the opposite of the current conservative stance.

Of course! You will also be able to make questions to the candidates, of the 5 minutes that each has 1 minute is for questions. Not a lot of time, I know, but we have 15 candidates, and also if something comes up we can find other way to keep the discussion going.

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Hello and good morning. After a successful first phase, we are currently through the elections phase with 4 snapshots live until Thursday. In the meantime, we have hosted two calls for all candidates to pitch their candidacies: you can find the recordings in the following post.

While we are on the election phase to determine the future DAs, is time to discuss the proposed changes for Tally. Based on the public and private feedbacks received, the three areas to target improvements: Grantees accountability, Program and DAs operations, Compliance to future changes in the DAO.

Grantee Accountability: it’s clear that the DAO wants to have better results from the program, where better = more stickiness of teams, less frauds (which can be unfortunately frequent in low sized grant programs), better results over time. For better accountabilities of the team these changes will be introduced:

  • KYC: it will be mandatory for two people of the team. The signed document will have to match one of the identity of the KYC members who kyced. This will add friction on whoever tries to impersonate others.
  • Identity verification disclaimers: a clause will be included when filling for a grant, in which a team might optionally need to participate in video calls with the DAs with cameras turned on. Failing to do so might lead to be rejected for the grant.
  • Completion milestone: to increase the incentives for grantees to complete their proposal and to complete both the final report and the followup questionnaire, up to 15-20% of the grant will be released 3 months after the final milestone, pending evaluation from the main DA which will take in account the success of the project. In this way, not only we will have the complete documentation from the grantee, but also we will guarantee that a portion of the grant goes to teams that effectively keep going with their activity 3 months after the release of their product.

Improvement in operations for the program and the Domain Allocators: there have been reports and feedbacks on how the DAs can operate better, and how the program could also improve through technological improvements, to guarantee more quality in the program. The following will be implemented:

  • More in depth guideline for due diligence for DAs: thanks to Entropy, we have worked together, on a set of easy to follow but comprehensive guidelines to do due diligence on projects. These guidelines are a mix of verification of identity through socials and check for open source data. While DAs are not in the business of being on-chain sleuths or osint researchers, we can’t give for granted that they have strong experience in verifying all the contextual data that can give more confidence of a team being genuine.
  • Improvements in transaction execution time: to avoid bottlenecks in releasing grants, the structure of safes will be changed from the previous 2/2 to a 2/3 for each domain, with the main two signers being the respective DA and the PM, and a third backup signer being another DA. To increase security, any specific pair of DAs won’t be a signer of multiple safes.
  • Improvement in how the Questbook platform generates the transactions: to mitigate and possibly avoid cases such as double transactions, we will ask the Questbook team to improve the generation of transactions through their platform. Specifically, the message that is generated by signing a milestone directly in the platform won’t be encoded but will be in clear text for the DAs to have a further way to verify that the milestone queued is the right one, as well as some other improvements such as checking if the address input by grantees is formatted in the right way for the system to ingest it.
  • Secondary ledger: the PM will keep a manually updated spreadsheet with all the transactions generated for each project.

Compliance to future DAO changes: several delegates requested the program to be in compliance with changes to the rules of the DAO in the future, specifically regarding communication, oversight and other details:

  • Standardized communication format implementation: while the PM will regularly communicate to the DAO on a monthly basis through the governance calls and with a unified report consistent across all domains, the communications might change in the future in case the DAO will agree on a general standardized format cross-program.
  • Future oversight council compliance: as for comms, in case the DAO will agree on a general unified oversight unit, the program will adhere to it.
  • Hourly commitment and rate: for both the DAs and the PM it will be mentioned the amount of hours preallocated to them (80 for DAs, 60 to 80 for the PM) and the hourly rate ($100 per hour).

As per the timeline, and unless there is a meaningful desire from the DAO for profound changes and discussion of the proposal, the plan is to publish it on Tally Monday the 27th, to go live for a vote Thursday the 30th. We want to use this current week to address any further concerns, so all delegates are invited to provide feedback on the above changes.

As a final note, there could potentially be some adjustments to the compensation based on internal feedback from delegates. To be clear, the current discussion doesn’t aim to introduce more budget to the program nor make meaningful changes, but rather suggests some modifications in the overall distribution; if there is a consensus, it will be posted in the forum beforehand.

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After internal feedbacks from delegates regarding aligning the PM to the rest of the team, and potential concerns about the platform’s costs, the following changes will be made to the economics of the Tally proposals:

  • the proposer of the RFC / PM Jojo will receive, pending successful on-chain vote, 25,000 arb tokens, as retroactive payment for the drafting, review and refinement of this proposal, as well as the managing of the election process itself. The 25,000 ARB will be delegated to Tally profile of Jojo for a minimum period of 180 days following receipt of funds. The amount was calculated taking in account the current ARB price and the $19,800 spread in compensation between DAs and the PM for the 18 months term
  • the Questbook platform fee will decrease from $84,000 total ($7,000/month for 12 months) to $60,000 total ($5,000/month for 12 months).

As a consequence, the total cost OpEx of the program will change from the previous $727,800 for 5 domains to $703,800 + 25,000 ARB.

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Honestly, I don’t have a strongly consolidated opinion on this matter. This change won’t make me vote against the proposal on Tally, but it does raise some questions, which I’ll outline for discussion.

I do agree with rewarding the drafting and execution of proposals when the proposal gets approved on Tally. It’s a task that requires significant time and effort, so it makes sense. And if there’s someone who works exceptionally well and deserves to be rewarded, it’s @JoJo

That said, this brings up several questions for me.

First, what is the appropriate amount to pay for this? What would be the right criteria? Should we consider setting a cap or criteria in the future?

Second, does it matter who drafts the proposal when deciding on payment approval? Let me explain. The proposal could be drafted by a contributor who is not directly involved in its execution—for instance, like Joseph with the ARDC—or it could be drafted by someone who directly benefits from its execution, such as Jojo in this case, given his role as PM. Should there be some differentiation in these cases?

Additionally, many proposals are drafted by delegates, and the DAO has already approved a compensation mechanism for that:

So, should delegates be encouraged to request payment when a compensation mechanism is outlined in the DIP? I understand that, in many cases, that 30% BP doesn’t reflect the actual cost in hours of work. But perhaps that’s how the DAO values this work when it’s carried out by delegates who are already incentivized in their role as active delegates.

These thoughts make me believe that we need a clear policy for this.

That being said, I support the proposed changes and will vote in favor on Tally.

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I might have posted it in an unclear way to be honest.
While the “retro” part is there, the amount, 25k arb, is mostly to align the salary of PM to the DAs.

This was noted, publicly, here

I can say that a few delegates reached out privately as well on this matter, highlighting how in grant programs usually the PM has at least the same salary of the committee, even just because of responsibilities more than the workload . But, in all honestly, I was struggling in increasing the overall opex of a program that doesn’t cost as a ratio too much but has indeed an important cost (around 10.5% of overall budget).
The solution was to cut a bit from the fees of the technological provider; at the same time, just a straight increase of the usdc payout on the comp was still something not advisable even just from an optic perspective among others.
The proposed solution was then to have an allocation in arb that was not sellable for the first 6 months, and that should have been delegated. At current prices of $0.72 would mean $18,000 which would put the monthly comp at around $7850 (considering the low capacity period of the last 6 months after 1 year).
Clarified these details, we have several options here:

  1. increase the duration of the delegation clause to 1 year, to match the main duration of the program
  2. put instead the amount in a vesting contract. It can be ok, but for the not so big amount it felt like an overshoot and this is why it was not proposed
  3. alter, beside the modality, the amount of arb, if you think there is a better logic to determine the number compared to the one detailed above
  4. scratch the whole thing, because while is not a material change to the economic of the program is indeed a change to the salary of the PM that is happening right before tally.

I’m open to any suggestion of the above or others, including 4 of course.

I can agree with this, honestly. In an ideal world we would have a separation of all roles. But often times is hard because usually the changes that have to be applied during discussion with delegates have a very high impact on operations, and without having at least a first line of contributors of the initiatives involved it could lead to disruption of services. In the case of ARDC, the “smart” thing is that while @Immutablelawyer did indeed steward the proposal without taking then part to it, the members, elected after, were able to also pitch their hourly costs. And had the time to not only analyse the first proposal, but also the changes submitted, before drafting this cost.
If I had to take a parallel here, basically the initiative should have been independently drafted, discussed with delegates with changes, and then having contributors applying for the PM and DAs roles with a cost attached to them, because the changes can materially impact the amount of work.

I generally think is hard to find people motivated enough to draft a proposal that doesn’t have a followup for them. Note that the followup doesn’t necessary have to be the direct involvement in the program, because secondary effects like increasing private business or others can play a strong factor in the decision. But this is more of a personal opinion than anything else.

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when I suggested in the delegates telegram chat, that would make sense in this case, for the proposer to get compensated by drafting the proposal, I also added that that change would have to be done, in tandem, with an election for the PM position.

in my opinion, it only makes sense to reward a proposer for proposing, if the proposer doesn’t financially benefit from the proposal passing. that’s what happened in the ARDC V2 case with @Immutablelawyer getting 35k ARB for drafting the proposal and managing the election process.

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Thank you for your honest take.
As an update, the proposal won’t go to tally this weekend because we didn’t had an address controlled by the AF that we could use for the on-chain vote, so we have the ability to discuss the detail above, as well as any other detail, for another week. All feedbacks appreciated.

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I do agree with the PM having at least the same compensation as the DAs, especially because the role comes with the responsibility for the PM to guarantee that there’s no erroneous spending.

and given what we recently learned about the intricacies, quirks and features of the platform being used, I appreciate that the money to cover the raise in the PM compensation comes from the Questbook share.

The vote will go on tally in pending monday, 3rd of February, with on-chain vote starting the 6th. We will use the following address, controlled by the Foundation, to receive the ARB in case of a positive vote: 0xb9a05fCcc841202f1ee0dEee557C6abE5cbb6615

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Hi all,

Confirming the AF address mentioned by Jojo above, for receiving the funds: 0xb9a05fCcc841202f1ee0dEee557C6abE5cbb6615

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I will vote YES on Tally to “renew the program with $7,477,800 and 5 domains”. I am particularly keen on seeing how better methods to assess project sustainability in the long run are implemented from season 3 onward.

The program itself is a great idea, but the short or long-term viability of any grants is what we truly should use to determine its success.

We will vote YES on tally.

The undeniable success of season 1 and 2 and now season 3 with additional steps for optimisation and transparency offers great perspective. Thanks to @JoJo for spearheading this endevour.

One minor reserveration we have is the potential overallocation to gaming.

In our opinion, the gaming vertical has not proven long term PMF to the extent that other crypto verticals have - like DeFi.
While gaming has the potential to onboard a larger number of users, the nominal amounts in gaming are usually small in comparison to finance. This is true both in crypto and the non-crypto world.

We acknowledge that it’s too late to adjust the proposal and therefore will support it, but we suggest that future iterations take into consideration general TVL trends in crypto and allocate funds proportionally.

Nothing more to add. I will vote YES on Tally

Voting has started for this proposal!
Vote on Tally: Arbitrum D.A.O. (Domain Allocator Offerings) Grant Program - Season 3


I am a bot. Questions? Contact support@tally.xyz

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We are live on Tally!
In the meantime, we have updated the numbers related to the projects, milestones and funding related to season 2. The updated spreadsheet is the same of the first post and can be found here.
The following screenshot is from Tally.

(note, this data refers to around 10 days ago for some domains; the work for season 2 at low capacity is still ongoing).

In case of successful on-chain vote as stated myself, @SEEDGov, @Flook and @Juandi will forfeit any of the remaining payment for season 2 from the start of season 3 which should happen, all things considered, the first of march.

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LobbyFi’s rationale on the price and making the voting power available for sale for this proposal

Given the community’s desire to improve the program’s effectiveness, as evidenced by the feedback and suggestions received, LobbyFi believes it is important to facilitate the passing of this proposal. The program has a strong track record of success, and LobbyFi sees the broader Arbitrum community, including potential grantees, as the primary beneficiaries of a positive outcome for this proposal. Considering these factors, LobbyFi will make its voting power available for auction for this proposal.

As done for some other proposals we made available on lobbyfi.xyz, we would like to leave an option to “rescue” the proposal for a fraction of the full funding amount. The instant buy will be priced at 0.5% of that amount, which makes up ~13.5 ETH ($7,477,800 * 0.5% in ETH).

We are going to vote AGAINST this proposal. While we acknowledge the importance and some success from past grant proposals, the spending at the DAO level has to be reduced and seriously evaluated. We are sure that this will not matter and the proposal will pass regardless, but it should serve as a signal to the DAO that it is continue to spend in a reckless manner.

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I am voting FOR this proposal, as I believe it will further strengthen the Arbitrum ecosystem.

That said, I future proposals should be more reader-friendly, particularly with clearer cost comparisons across seasons and argumentation. For example, looking at the adjusted cost comparison for a 12-month period:

Category Season 2 (6 months) Season 2 (12-month projected) Season 3 (12 months) Change
Questbook & PM $60,000 $120,000 $169,800 +$49,800 (+42%)

Can you provide a more detailed explanation of why this increase is necessary? This would not only improve transparency but also increase my confidence voting for the proposal.

Additionally, from a cost-benefit perspective, future proposals should place greater emphasis on both tangible and intangible value that the Grant Program will achieve (e.g. outlining benefits for Arbitrum & users, success metrics, and other expected ecosystem benefits).

In a nutshell, providing deeper justifications for cost changes and highlighting projected impact would make it easier for delegates to evaluate the proposal’s effectiveness.

Looking forward to seeing how this initiative delivers on its goals. Thank you.

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