Gauntlet provided in-depth feedback on this significant proposal during DevCon. The proposed OpCo presents an opportunity to address critical gaps in Arbitrum DAO governance, including horizontal and vertical organization, financial planning and budgeting, and program management resources to ensure that DAO initiatives are aligned, accountable, and efficient.
However, there are valid concerns regarding the execution of the proposal:
- Legal Considerations: The proposers need to address legal issues, and while the Foundation has offered advice, we are not prepared to comment on this aspect. However, $2.2M to support entity setup, legal advisement, and insurance is still a large financial line item for an exciting but un-proven proposal.
- Risk of Centralization: The potential for centralization depends heavily on the OpCo’s execution and setup. Ideally, the OpCo would function as an operational advisor enabling DAO-approved programs. Unfortunately, it could also become a gatekeeper of essential resources necessary for proposal success, such as legal, financial, or operational support. At Gauntlet, we envision a DAO future that relies on simplification and on-chain tooling to automate away bureaucracy. While this vision may not be realistic in the short term, we must admit that this proposal is a decided step in the opposite direction.
- Reliance on a Single Chaos Coordinator: The OpCo heavily depends on filling a “CEO”-type position, which poses a significant risk. Concerns exist about whether the DAO can define this role with sufficient focus and direction to enable success or if it will become an overwhelming position where the individual is expected to solve the DAO’s problems with minimal guidance. Anyone active in the DAO likely admits that OpCo will fail if this role is not actively set up with the structure and guidelines to succeed. The eventual candidate is the most critical piece to the OpCo’s success.
To this point, it would be worth adjusting OpCo’s KPIs for the first few months toward specific critical deliverables rather than broadly aiming to get established and optimize itself for time/agility. Examples include:
- Hiring a specified number of employees for defined positions.
- Designing and implementing a financial reporting structure for all DAO grant programs.
- Approving a target compensation range for DAO council positions.
- Signing a long-term contract with a vendor for DAO communications.
- Establishing regular touch-points with Arbitrum Stakeholders (Delegates, OCL, AF, Entropy, GCP, etc.)
Ultimately, Arbitrum is currently on its heels to defend its market position in a quickly growing L2 landscape. There is a time to place big bets, and we appreciate OpCo’s potential to help jumpstart the DAO toward making more definitive and efficient moves. We prefer the DAO to measure twice and cut once if it proceeds with OpCo.