Proposal to Backfund Successful STIP Proposals (Savvy DAO) [FINAL]

I see the proposal very favorable, wouldn’t change a thing in it.

The prop should be put up for voting, not only because it would be fair, but because it would benefit the diversity of projects being built in the Arbitrum ecosystem as such. Same problems sometimes need different approaches to be dealt with in an agile and efficient way.

The main advantage I see, is the opportunity of collecting as much data as possible via the STIP distribution, analyzing it and making the according adjustments in the future STIPs or any other subsidies the Arbitrum DAO may or may not provide. So having an almost twice the data sample size, makes decision making a lot more efficient.

So, you mustn’t look at this part of the grant as a “pitty giveaway”, you should see it as an investment in the ecosystem as such.


There are a number of protocols that reached the passing criteria for the STIP that are not included here. Would be odd and unfair to not include all of the proposals that passed according to the criteria listed.

“To succeed, an application must reach a 71.51M ARB Quorum and receive more than 50% of votes in favor of the proposal.”


I support the extension and I think its fair to the teams that got their proposal approved. That said I would like to understand what is the criteria for the cut, since Beefy (the protocol I collaborate for) is not on the list. Based on my understanding the proposal should include funding up to “Prime protocol”.


The cutoff was based on the original STIP round 1 voting. Basically any team that was approved (reached % for and passed quorum) but was not funded due to the 50m funding cap is on the list.

BUT the important thing is that after this STIP process, the data will be used to create a much more equitable, well-structured grant proposal for projects across different verticals and sizes. So lots on the line here.


Hello everyone,

I write as a member & on behalf of the Trader Joe Governance Council:

Firstly, kudos to the STIP-Inclusion working group for spearheading this proposal and working tirelessly to make sure that the STIP is more inclusive in nature and serves to give smaller projects an opportunity to show what their products are capable of achieving. Lest we forget that these incentives will be distributed from protocols, by virtue of the respective protocol’s functions, and thus this will naturally give some much needed exposure to various projects that are either taking their first steps within the Ecosystem, or are small/medium-sized in their current stage of progression.

Secondly, the Trader Joe Governance Council would like to express its support for the Backfunding proposal. The main reason for our support here lies in the fact that for just an additional 21.4 Million ARB, the Ecosystem will be funding an additional 26 projects that will increase the incentive-impact of the STIP to a total of 56 projects. Hence, for less than half of the originally funded STIP, the Ecosystem will be able to fund almost double the amount it would have with the initially concluded STIP round. We see this value-add to be substantial in nature and one which will naturally lead to the STIP achieving a far greater successful outcome & impact. In addition, one of the goals of the STIP was to attract new developers and projects to the Ecosystem. As a Phase 1 participant, Trader Joe truly appreciates the substantial efforts invested by all parties involved. Remarkable small and medium-sized projects and developers participated, and we firmly believe that funding these projects independently via backfunding will successfully fulfil one of the primary goals of the STIP.

At its current stage, the STIP has already provided a host of lessons that ought to be taken into account for the structuring of future incentive programs within the Ecosystems (most predominantly, the main lesson being the need for a more equitable disbursement of incentives so as to grant small/medium-sized projects a level playing-field for incentive competition).

We look forward to working with other Ecosystem partners and contributors so as to make sure that future incentive programs cater for the aforementioned project-class and thus, serve to attract prospective start-ups to the Arbitrum Ecosystem.

Kind regards,
Immutable Lawyer
Axis Advisory


Hello I am writing as lead of the Arbitrum Treasury and Sustainability working group to comment on the budgetary implications and price impact of passing this proposal

We recently concluded our analysis on ArbitrumDAO’s suggested spending limit for Q4 2023. We project there to be minimal price impact if the DAO limits itself to a 135-210 million liquidation until December end (of which 80 million has been already allocated).

The current proposal thus represents ~10% of our budget for this quarter and is a good utilisation of funds in my personal opinion.


As @Djinn said below any team that passed quorum AND had greater than 50% FOR vote is included. You can see the full list of “approved teams” here: ARB STIP —

The cutoff was based on the original STIP round 1 voting. Basically any team that was approved (reached % for and passed quorum) but was not funded due to the 50m funding cap is on the list.

BUT the important thing is that after this STIP process, the data will be used to create a much more equitable, well-structured grant proposal for projects across different verticals and sizes. So lots on the line here.


Strongly believe that we need to provide funding to those who made it to STIP-I and passed the quorum. All these projects passed on the basis of merit showcasing their hard work and achievements in the past.

  1. This vote for funding will showcase that tech prowess and user acquisition stats matter more than being close to whales or having ARB OGs on cap table.

  2. It will also establish that Arbitrum as an ecosystem maintains a relatively neutral stance as long as there was a demonstrated historical performance and the system doesn’t try to nitpick winners. All capable candidates need a level playing field and funding the remaining STIP projects will more or less enable this.

Firmly support this!


We at Gains Network strongly support the backfunding proposal by the Savvy DAO. This initiative stands to significantly bolster the Arbitrum ecosystem by providing much-needed support to diverse and emerging builders, which is vital for innovation and growth. By addressing the limitations of STIP 1, we can ensure that our commitment to inclusivity isn’t just aspirational but actionable. This proposal isn’t merely about allocating funds; it’s about upholding our community’s values and fostering an environment where all builders, regardless of size, have the opportunity to thrive. It’s a strategic move that acknowledges the importance of diversity in our ecosystem and reinforces our dedication to nurturing high-potential projects that may otherwise face undue hardships​.


I support this proposal.
These projects all met the requirement of STIP 1.
The current all-or-nothing cut-off at 50M would create an unlevel playing field within the arbitrum ecosystem that frankly is not necessary nor beneficial to the arbitrum chain.
I believe further funding to the tune of 21.4M ARB is a small price to pay for this and would benefit the 26 important protocols that took a lot of time and effort to get their proposal to pass STIP-1.


I have to commend Alex and the rest of the Working Group on the amount of thought, effort and coordination put into this proposal. For those who weren’t close to the process, this has been tirelessly worked on for 7 days a week since the day voting ended on Round 1. Every effort has been made to engage with delegates, successful Round 1 projects and wider community members to ensure each aspect was considered.

Naturally, the Stargate Foundation supports this proposal. An additional 26 projects being funded, especially for a lot of smaller grants, will enable significantly more growth and development of the ecosystem. This is particularly obvious when considering how successful the initial funding of 50M ARB has already proven to be with TVL up 15% and volumes up almost 100%.

The STIP process was a huge learning opportunity for the ArbitrumDAO on how to best run a similar process in the future, but also how popular Arbitrum is as an L2 and how many protocols are willing to put in work to support it. This proposal closes the loop and signals support for all projects that were initially voted on to help the DAO achieve its goals.

We look forward to continuing our support for Arbitrum and it’s participants.


Thank you for the very well thought out and detailed proposal.

I think this addresses the concerns many have had with the results of the first round in the most effective and timely way possible. Restarting a new round would be time consuming for everyone involved, taking valuable time better spent developing. It would also skew the advantage in favour of the first round ‘winners’, when the intent is to benefit the ecosystem as a whole.

It’s clear these projects were intended to be funded, as they received enough votes to be in favour. It only makes sense that this intention is realized by extending the grant.


We are fully supportive of this proposal as written. We believe that reaching some solution for the backfunding issue is critical to the Arbitrum ecosystem and believe this particular proposal has done excellent work in balancing what is essential and what is practical to put forth a workable solution.

Savvy DAO has done an exceptional job putting this together We have been involved in this process and cannot adequately express the amount of work and thought put into this proposal. Savvy has spoken to every stakeholder and considered all arguments with an open mind. I believe they have sincerely tried to be unbiased and taken precautions only to accept arguments supported by compelling analysis. I believe the process alone is an example of well-intentioned and thoughtful DAO governance.

Arbitrum lives by the strength of its small teams. The Arbitrum delegates were impressed with and supportive of the teams that passed the initial round with a quorum but were excluded due to the 50M cutoff and small print that explained how that cutoff would exclude teams with fewer votes.

There are many reasons to backfund these ~30 projects:

  1. These are primarily the smaller and Arbitrum native teams that governance wants to support. I believe the proposal above has given substantial evidence around this point.
  2. An untested voting process meant that political relationships were a decisive factor in the initial STIP vote. We should expect this type of political imperfection in a young DAO. However, we should not let an imperfect political process lead us to a self-inflicted wound
  3. We should be happy the program was such an unmitigated success. I have not seen the Arbitrum governance and community so alive in a long time.

Backfunding the STIP is cheap. It’s entirely normal for companies and ecosystems to spend to strengthen network effects. Arbitrum is worth $10B FDV — Spotify, Uber, Twitter, Netflix, and Amazon were all spending significantly over $1B per year when they were at $10B.

In this proposal, we are spending a marginal $25M to repair a situation that is disproportionately hurting small, hardworking teams that are the lifeblood of Arbitrum’s ecosystem and network effect. Please do not underestimate how hard it is for a small team to compete with a larger project that has a large amount of incentives. As one example, we estimate that GMX’s $12M of ARB incentives will lead to between $15B and $25B of incremental volumes. How can a small team compete for those volumes if they don’t have incentives because we are waiting to see the data from the first round?

What matters for Arbitrum is the demand story. Investors want Arbitrum to bring on more teams, community members, investors, and customers. Investors want to see Arbitrum grow transactions and volumes. They want to see Arbitrum’s network effect strengthened. They want Arbitrum to regain and retain its title as the undisputed leader of defi built by small, decentralized teams.

Instead, if ~30 small Arbitrum teams feel disenfranchised by the political process (and a few of these teams shut down because they can’t compete with large teams that have a few million of ARB to spend) then Arbitrum will become a less interesting place to invest.

Arbitrum has a golden opportunity to regain its position as the undisputed leader in defi after falling a bit behind Optimism (in large part due to intelligent allocation of OP incentives). It can do this as market volumes and volatility are coming back, which is lucky. We should be focused on giving this our best shot at a reasonable price. It doesn’t really matter if Arbitrum spends 25, 50, or 75bps of FDV (e.g. 25M ARB is 25bps of Arbitrum FDV). What matters is that the program works to attract teams and users that can drive innovation and strengthen Arbitrum’s network effects.

Theia is highly aligned with the Arbitrum ecosystem. We have investments in Arbitrum, GMX, GNS, GMD and Trader Joe. After meeting with a lot of the teams that stand to be left out in the cold by this proposal, we also have an emotional investment in the outcome of this vote.


The Magpie Ecosystem supports this initiative and the provision of back-funding for successful STIP proposals.


What happens to potential projects who did (or were planning to) apply for round 2? This proposal seems to give an unfair advantage to projects of round 1, as they get indiscriminately included in this possible extension of grants. It’s possible that delegates who voted in round 1 would prefer other candidates of round 2, but they don’t seem to be able to voice their opinion through the structure of this proposal (other than of course not voting in favor of it).

There was another discussion in Grants Discussions where it was proposed that the program should be extended for a round 2, where projects who didn’t make it in round 1 would have to re-apply along with projects who planned to apply in round 2, which has many opinions in favor.

So the voting options for delegates of this proposal could be:

  • Back-fund STIP Round 1
  • Create a new Round 2
  • Keep original terms

The drawback of course would be that it would create some overhead once again for reviewers, delegates etc.


Round 2 isn’t off the table because of the backfund.

If anything, this will accelerate round 2 happening, as we will have way more data to build better followup STIPs.


I support this proposal where all of these projects already met the requirement of STIP-1.


I thought this was being discussed in Extension of Arbitrum’s Short-Term Incentive Program

As stated there I will vote against it as I believe we should
Option 1: Continue with round 2. Continue with the existing program structure where we hold a round 2, everyone from round 1 who had not qualified can retry in round 2. Supporters - @limes @DanThales @mint_cloud @deBridge

Selfishly we from were awaiting round 2 to apply and find it not unfair to not been given the opportunity to participate


confirming that was waiting for round 2 to apply so if this proposal passes won’t be able to participate until a round 2 (which does seem more difficult to be happening given the additional funds deployed for the backfund)


Agree with this perspective. Hopefully our proposal (and many other projects) will have a chance to get voting from the community through a round 2.