Proposal: Experimental Incentive System for Active ArbitrumDAO Delegates

We would like to thank the Seed LATAM team for their dedicated work on this proposal. Their commitment to enhancing our DAO’s governance is commendable. We are leaning toward supporting Option 1, appreciating its community-driven approach and the nuanced evaluation of delegate contributions it offers. While the automation aspect of Karma in Option 2 is intriguing, we believe it’s too early for full implementation. Given the likely evolution of metrics after the first season, a more adaptable, manual trial is preferable. We suggest using Karma as a benchmarking/data visualization tool in these initial phases, ensuring an additional layer of oversight and accuracy in our processes.


Is anyone else having a problem voting it just keeps spinning!!! tested with different extensions and browsers and still the same

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I experience the same problem. I don’t know what’s the cause

Arb has been at the forefront of the industry in developing and discussing DAO. Therefore, I fully support the Experimental Incentive System proposal due to its clear structure, detailed framework, and commitment to fairness. I am excited to witness the positive impact it will have on delegate engagement.


We first want to thank Seed LATAM and @cattin for their continuous effort and dedication on this proposal. As the DAO continues to engage in discussion as to the best mechanisms to support governance participation and proposal analysis, Seed LATAM has been a leader in enhancing our governance process. Given this, Michigan Blockchain are voting FOR Option 1 in the snapshot temperature check.

Seed LATAM has delivered a comprehensive incentive system that involves detailed scoring criteria and encourages community involvement. We believe that the current proposed system will sufficiently evaluate delegate participation with transparency. We must acknowledge that this is our first attempt at such a system. A transparent and iterative process is therefore crucial to produce a community-driven program that benefits the DAO governance and protocol as a whole.

This is also why we are choosing to support Option 1 over Option 2, which introduces automation with Karma. Though automation and optimizing the process will be important as the DAO progresses, implementing such a system before we have fully understood what is required of said system would be unnecessary and could hinder our ability to iterate and improve going forward. We agree with @Curia that utilizing Karma or other tools for data visualization and transparency would be beneficial as we run this trial. We are excited by the prospect of this proposal and look forward to working with Seed LATAM and our fellow delegates to see its success.


The below response 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 are voting FOR this proposal in the temperature check, choosing Option 1 as our preferred solution for the time being. Our rationale and some suggestions regarding potential amendments that could be made before the onchain vote are outlined below.

First of all, we would like to echo the gratitude to @cattin and the whole SEEDLatam group for bringing this proposal forward and pushing the discussion on delegate incentives. We’ve been discussing and supporting this initiative for some time and have expressed the need for such a program on several occasions. Below we’d like to outline our thinking behind delegate incentives and our expectations for any program that implements it.

To begin with, we think that delegate incentives should come hand-in-hand with delegate responsibilities as receiving monetary compensation both gives birth to expectations but also serves as an enabler for the delegates to carry out their responsibilities.

The role of delegates as we understand it, especially delegates with significant voting power, is of an executive in the DAO, as it’s up to delegates to cast votes and effectively make decisions regarding protocol mechanics and upgrades as well as treasury management/spending. Moreover, and given the current quorum requirements and average participation in the votes, no decision in the DAO can be made without the engagement of top (by voting power) delegates.

Therefore, it is extremely important for these delegates to be informed about the merits of the initiatives taking place and proposals being made, to actively participate in the discussions, to closely follow the development of different proposals and various initiatives and to also to help shape their details. In a broader sense, top delegates need to help navigate the strategic direction in which the DAO is headed.

After all, how can a delegate drive to a conclusion and make a decision on a proposal if they don’t know the context in which this proposal has been brought up, how the specific proposal has been developed in the relevant working group, what other possible options have been considered, and what are the expected consequences of passing a given proposal? Not to mention that many proposals require direct oversight from delegates to ensure proper execution or to take action if the proposer fails to meet their obligations.

If a delegate only spends a dozen minutes reading a proposal (which the proposers have spent tens of hours preparing and discussing) right before they vote and then cast their vote according to their gut feeling based on the limited context they were able to acquire, then it becomes readily apparent that such a governance system isn’t sustainable in the long term.

However, we know very well that this level of engagement requires a time commitment that is usually beyond the capacity of many delegates, especially the largest ones (by voting power) who are typically involved in multiple projects and have many other commitments. It’s understandable and we cannot expect them to make personal sacrifices for the good of the DAO.

That’s the reason why we believe that this incentive/compensation program can serve as an enabler for those delegates to better fulfill their role - either by freeing up a considerable amount of their time to devote to delegate work, or by hiring someone to assist them as their DAO representative (similar to how @Sinkas and I serve as the representatives of L2BEAT and not of ourselves individually). And with the resources from an incentive program at their disposal, the DAO can now expect these delegates to participate meaningfully in governance’s day-to-day, and the DAO can begin to define delegate expectations.

Having said that, we’re not sure if the current scoring framework presented in the proposal fully supports the goals that we outline above, as it puts most of the weight on the voting itself rather then on proactive contributions in the DAO activities before the vote even happens.

If others agree with the aforementioned goals and rationale behind the incentive framework, then we would like to see this scoring framework adjusted to better reflect those goals - either prior to the on-chain vote or later during the proposal execution phase.

Overall, we think it’s a good first step and an experiment that will allow us to better understand the impact of such a program and allow us to set expectations for the delegates who participate in this program in the future.

Finally, we would like to point out that this program is intended for delegates as executives/decision makers in the DAO. This program should definitely not preclude other incentive programs for non-delegates (or delegates who do not meet the requirements for this incentives system) who would bring valuable work to the DAO.


Treasure DAO’s Arbitrum Council (ARC) has voted FOR this proposal (with Karma).

The Arbitrum DAO’s ability to consistently make high-quality decisions is integral to the growth and prosperity of the ecosystem. Delegates, as the key decision-makers in the DAO, currently fulfil their crucial role without compensation and delegates proactively participate out of goodwill. The proposed solution aims to address these issues by introducing incentives and rewards for delegates actively engaging in governance activities. We do think substantial changes will need to be made to accommodate a future in which separation of verticals within Arbitrum becomes more of a reality, but given the experimental and short-duration basis of the program we are supportive of the proposal as it currently stands.

While we acknowledge the positive steps taken by this proposal, it’s important to recognize its potential imperfections and incompleteness. The quantitative approach to delegate engagement within this framework, even with the Bonus System, may struggle to capture the nuanced aspects of good delegate action, for example providing feedback on pre-forum ideas and attending calls and workshops. Additionally, we also recognize the maximum monthly reward of 5,000 ARB may not sufficiently compensate delegates for full-time engagement and activity within the DAO.

We feel that arbitrarily capping the number of delegates to receive incentives for their governance efforts is unnecessary given there already being requirements, like the voting power and historical participation, that significantly filter and reduce the eligibility for this program. Although this plateau gives delegates a clear and static amount of incentives for their contributions, it also favours the conglomeration of governance efforts through not extending incentives to lesser contributing delegates at all and could therefore by proxy increase delegate centralization. On this same note, the proposed tier system in the ‘DRAFT’ version seems rigid, by having arbitrary cut-offs on incentives awarded to each tier. We feel that having a more dynamic system of incentives on a continuum, instead of strict tiers, makes more sense in getting a fairer amount of incentives for the efforts put in by the delegates.

In light of these considerations, we express our support for this experimental framework. However, we advocate for its complementation and augmentation with additional contribution and incentive frameworks. These frameworks should be designed to encourage and reward delegates and community members who contribute in less easily quantified ways. Furthermore, we advocate for a more dynamic and wider range of incentivisation of delegates by removing the cap and tier system and replacing it with a more direct continuum based incentivisation system. This way, smaller delegates who can put in less hours but still contribute their part will also get incentivized for their work, leading to a more inclusive and decentralised Arbitrum.

We applaud Seed Latam for addressing this important topic head on, and look forward to the introduction of a starting framework which can be further refined and built upon over time.


Firstly, we would like to thank @cattin and the Seed LATAM team for reviewing previous proposals and creating this one. We are also grateful to @Patrick_J for sharing his experiences at MakerDAO and contributing to the further development of this proposal.

We are quite excited to see the delegator incentive mechanism, which has been tried in other protocols and solved in different ways, being tested in ArbitrumDAO. We would like to announce that we will actively participate in this experiment and fulfill our responsibilities as delegators. Additionally, the fact that the program can be stopped by a vote from the DAO and that funds will be distributed monthly is an important point in gaining the community’s trust.

We voted for the management of the voting to be primarily handled by the Seed LATAM team and secondarily for the use of Karma, as we believe Karma does not yet have sufficient features for this experiment. We are open to helping out in any way we can during the process.


Great work. It’s going to be quite interesting to see the results after 6 months. Very high chance of boosting engagement. The design is overall fair and inclusive. However, I was a bit concerned about the risk of the system becoming overly reliant on quantitative metrics, which may not fully capture the qualitative aspects of delegate contributions. A blend of quantitative and more decentralized qualitative metrics might provide a more holistic evaluation of delegate contributions in the next iteration. But finding the good framework to evaluate the quality of contributions is not gonna be easy. So I believe the proposed approach is a great start. Gonna vote for it.

I’d like to also thank @Cattin and Seed LATAM for drafting this interesting experimentation.


I very much like the experiment. I was always hesitant to implement a reward mechanism for governance participation as it might increase bots & nonsense contributions. But I guess the only way to validate that is to do it. As it is engineered now, needing 50k ARB is the barrier that keeps those aforementioned away. Super curious to see this come to life


I think the original intention of representative Dao is to better perform his duties, and it is a good proposal to give $ARB appropriate incentives.


Thank you so much, everyone, for the overwhelming support received on this proposal - since option 2 was the most voted, once this proposal goes to onchain voting, we would have to proceed with the first payment for Karma (10k ARB) so that they can start developing the dashboard for this program.

Before this, though, I want to state that I agree with the points raised by @krst - the idea of this program is to serve as a way to compensate those delegates who have been actively contributing to the DAO and ensure they have a predictable compensation for their future contributions, incentivizing their further participation/reducing apathy. But as pointed out, the greatest challenge we face is that we also have to encourage critical participation ~ the idea shouldn’t be to simply encourage large delegates to vote, but also to have a critical vote. So, as a first step in this direction, we added more weight to the delegate statement to ensure that delegates justify the way they vote (compared to what we had in our previous draft) - but this can definitely be improved, and we are open to suggestions. We could look into forum activity, which can be coupled with discourse metrics, but my only concern is that these are easy to game, and a lot would be left at the administrator’s discretion - that doesn’t mean it can’t be done tho. We could also add points for those who attend + engage in calls, but some delegates might not be able to participate due to time zones or simply not wanting to dox themselves. These are just some initial thoughts, though, and I am down to discuss this more in the monthly call.

Regarding the issues pointed out by @Treasure, we agree that there should be complementary frameworks that go beyond the scope of this proposal in order to compensate less active or smaller delegates for their contributions. We also have to emphasize that we did abandon the three-tier system, which was presented in the draft for a more flexible structure, by simply setting a minimum voting power of 50k ARB (to make it less economically viable to game) and also requiring minimum historical participation, in order to compensate those delegates that have been actively contributing to the DAO and incentivize their future contributions. However, we understand capping the monthly compensated delegates to 50 might be arbitrary, but we decided to cap it like this to make it more competitive and also alleviate the workload of the administrator to ensure that they can do their job properly ~ although we could change this a month or so into the program if we find it feasible. And regarding the amount used for monthly payments, we’re also fine with increasing it to maybe 6000 ARB per month, but again, we’re open to any other suggestion.

Next Steps

  1. Introduce some final adjustments to the proposal based on the feedback received during Wednesday’s community call.
  2. Share the final version on the forum based on the option that had the most votes (with Karma).
  3. Onchain vote - if everything goes as planned, we will proceed with the onchain vote as soon as possible, which would include the execution of the first payment to karma.


We believe it’s important to put some emphasis on some points of the proposal:

  • As a delegate directly involved in the development of said proposal, and as it was mentioned previously, I will not participate in this incentives program, but I will support SEED Latam’s team and will maintain my role in governance as I’m currently doing so.
  • The account that will handle comms related to this program in the forum will be that of @SEEDGov. They will be in charge of presenting reports and notifications regarding any modifications or issues during the development of the program.
  • @cliffton.eth mentioned that it might not be easy to proceed with KYC for 50 delegates in a one-week window every time we distribute the payments for the incentives program, so we might have to go with a multisig instead of the DAO handling payments every month. This takes away direct power from the DAO but might be the only way to make it viable. We still would like to discuss this over the governance call this Wednesday to clarify this and see how we should proceed.

Excited to experiment with this.
I voted for Option 1: Yes - WIthout Karma
as I believe this could be a viable way to incentivize better governance processes, while it’s still too early to build tooling before actually understanding what needs to be measured (the parameters might change a lot as we test this out in the next 6 months).

Question as this was my first Shutter-protected proposal:
are delegates expected/encouraged to disclose their voted answer before the voting ends, or that defeats the purpose of the hidden vote?


Delegates matching the requirements must confirm their participation in the Incentive System in the forum (a dedicated channel will be established for this)

is the channel already created?

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I think this is a very valid question, and I was also thinking about this, maybe for future proposals, it would be better for delegates to wait until voting ends to disclose their vote on the forum to make shutter voting more efficient ~ but it’s always gonna be at the discretion of the delegate.


Not yet, this proposal hasn’t been approved on Tally, only snapshot.


I dont agree with it. I think 50K is too much. The min amount of tokens should be 10k


And I think we need to vote about this on Tally!


A standout after a first read is the previous activity required on Tally to qualify as a delegate.

  • Historical Participation Rate (Tally): Over 25%

Whilst I appreciate that an understanding of the DAO and understanding of a delegates reliability is important, I feel this sets a high barrier to entry for new delegates who may not be able to dedicate that amount of time to governance without the compensation, yet may be able to provide valuable advice and guidance if that time was made available.

It seems like the payment mechanic sets this intention, so wondering if there are alternate ways to onboard delegates to the DAO. Referrals may be one way, for example.


The proposal has a limit of 50 delegates, who receive incentives.
Now there are more then 190 delegates with 50k ARB.
If you greatly reduce the entry threshold:

  1. This will not add a significant number of votes, since delegates with a small number of votes will be added.
  2. This will dilute payments to delegates by several times, so small payments will not give the effect that we want to achieve with this proposal