Proposal to Temporary Extend Delegate Incentive System.

Proposals
1

Proposal to Temporary Extend Delegate Incentive System.

Abstract

We would like to introduce a temporary extension of the current Delegate Incentive System for up to two months.

Motivation

SEEDGov is working on the v1.1 of the Delegate Incentive System. This new version will try to implement significant changes that we believe are going to improve the actual version of the system.

Considering that the actual program concludes on August 31, that the following iteration will probably need more than one week of discussion, and that we adapt to the recent approved DAO Calendar, we are presenting a temporary extension of the program with the objective of not interrupting delegates incentives while v1.1 is being discussed.

Rationale

Approved Delegate Incentive System has proved to be cost-efficient. To date, 1,1 million ARBs are still in the DIS multisig out of a total of 1.58M initially transferred.

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Note: Special thanks to our frens @r3gen_Finance for an early delivery of their Arbitrum Token Flow Report. The Full Flow Report will be published soon.

Note II: Data as of July 31, 2024.

With the objective of maintaining the delegates engaged and incentivized while v1.1 of the system is discussed, we propose to extend the current one for a period up to two months.

This proposal will be attached to the new Delegate Incentive System. If the new version of the system is approved before the temporary extension ends, this version will be deprecated to make way for v1.1 of the System.

Costs

As an important clarification, cost structures wonā€™t be changed during this temporary extension. Funds will come from the Delegate Incentive System Multisig.

  • Monthly Delegates Incentives: TBD (Average Monthly ARB incentives: 108,7k)
  • Karma Administration Costs: 3750 ARB per month.
  • SEEDGov Administration Costs: 3.333 ARB per month.
  • Multisig Administration Costs: 5.000 ARB per month.

Note: We know that costs are out of date. In order to smooth the process weā€™ll keep the same operational costs until the release of Delegate Incentive System v1.1

Next Steps

Acording to the recently approved DAO Calendar, vote will go live on Snapshot on Thursday, August 15.

6 Likes
2

Thanks for putting this up @SEEDGov

Pending the full report from r3gen, I believe itā€™s safe to say the delegatesā€™ incentive program has been good, and itā€™s great to see the team wants to take ample time to bake an improved version. With that much ARB still available in the multisig, this proposal to extend the program looks like the best course of action.

However, is there a rationale as to why we donā€™t just extend to EOY? That way, we start the v1.1 (if it passes) when the DAO comes back from the holidays in Jan '25

3

Hello!
In my similar proposal, I emphasized that the program has enough funds to increase the incentive for delegates to 10,000 ARB per month, due to a significant decrease in the token price from $1.7 to $0.6.
Accordingly, I also propose doubling all other maintenance costs.

Why not consider increasing it for only 2 months without additional costs?
This could at least be considered as one of the options.

1 Like
4

Thanks for putting together the proposal, @SEEDGov. We are excited to see the continuation of the program that works well for the governance. Combining with the proposal with Curia, we should be able to see more insights and areas to improve going forward.

We echo the ideas that WinVerse and cp0x brought up. It would make more sense to 1) extend this program until the rest of the year to do a fresh start with improvements in 2025. 2) adjust the incentives and costs based on the price fluctuation as the program has still enough budget for those changes.

1 Like
5

gm guys, thanks for your feedback on this topic.

We believe that extending the actual program to EOY is not the best of the ideas. As we previously stated, the first iteration of the program was meant to be experimental while the second one wants to be as good as it can, eliminating any possible flaw the first program could have. Also, with the current price of the ARB token being much lower than when approved, incentives fall short as a retribution of the DIPā€™s parameters.

As we are already working on a v1.1 of the DIP, 2 months seems like a reasonable amount of time to discuss the next steps.

We know that ARB compensation to delegates will indeed be a topic of discussion in the next iteration of the program as weā€™ve experienced a substantial decrease in ARB value. However, the reason why we maintained cost structures for this temporary extension is because we want to focus on discuss that topics in the v1.1 of the program, while keeping this extension as simple as possible to ensure delegates continue to receive incentives in between the finalization of the v1 and the start of the v1.1.

We are already working on the v1.1 of the Delegate Incentive Program, and it will be posted on the forum within the next week.

5 Likes
7

This makes sense to hold over between seasons and we look forward to the discussions for the next cycle. Would be interesting to discuss the amounts and budgets due to price deprecation over the course of the program.

Additionally, it makes sense for the team expenses of operating this to be kept constant in the extension, but should definitely be reevaluated at current ARB prices for future programs.

8

I obviously support the extention. Being here, provide meaningful comments, steer the narratives toward what we think is best for the dao, requires a lot of energy and time, and the DIP initiatives is definitely needed.

I also agree on keeping the cost the same, despite a drop in arb price. This is the problem we have in any program that is arb denominated: people are happy when price of arb goes up, unhappy when it goes down.
Consistency is key here, and for just a simple 2 months extention keeping everything as is is the best choice to avoid discussion that would better be targeted to a new renewed program.

EDIT just saw the proposal is on snapshot. Voting ā€œforā€.

2 Likes
9

Sounds like a good idea considering the amount of ARB left in the multisig.

1 Like
10

I voted Yes. Incentives arenā€™t are waste of treasury funds. They are securing participation in a DAO and mitigating attacks like recently seen at Compund.

2 Likes
11

Since joining the Delegate Incentive System, Iā€™ve put much more effort into my role as a delegate, with a more structured approach to casting my votes on Snapshot and Tally. The program is well-designed, encouraging even smaller delegates like myself to become deeply involved in decision-making.

I believe this program should be extended and developed into a long-term initiative.

I voted FOR in the Snapshot vote.

2 Likes
12

I voted ā€˜FORā€™ the extension of the delegate incentive system because it has significantly strengthened the governance ecosystem by attracting new delegates and fostering active forum discussions. I look forward to the improvements in the new version and the continued positive impact on the DAO.

13

I support the temporary extension of the DIP. I believe that using treasury funds to maintain a high level of participation could never be considered a waste of ARB. This incentive program is well structured and has proven good results in the past months, both looking at datas and at personal experience. Also looking forward to see how the new version will impact the DAO.

1 Like
14

VOTED for.
Extending the current Delegate Incentive System is a prudent move to ensure continuity and avoid gaps in delegate motivation while transitioning to v1.1. This extension prevents disruption in incentives and maintains engagement, crucial for effective governance. The proposal supports stability and allows adequate time for refining the new system, ensuring a smooth and uninterrupted evolution of the incentive structure.

15

The temporary extension is necessary. It is crucial to maintaining the engagement and motivation of delegates while the new version of the system is being discussed. Given the cost-efficiency of the current system and the need to ensure continuity, extending the program for up to two months is a practical and necessary step.

16

Iā€™m in favour of extending the delegate incentive system. It has had a positive impact in participation and its quality (which was the main objective). Time is limited, and this is a way of attracting delegate talent and staying competitive in governance in favour of other DAOs that also do have a delegate incentive programme. Good experience so far. Voted abstain.

17

I think this makes a lot of sense!

18

Blockworks Research is voting FOR this proposal on Snapshot.

The program has obviously been beneficial for the DAO thus far. In general, weā€™re pleased with how the delegate incentive program is currently going, especially after the analysis released on participation rates, and weā€™re hopeful to see how we can gauge DAO voter performance beyond participation moving forward. As others have noted, given recent price action, SEEDGov may want to consider fixing a few of these costs to be in USD (specifically their own administration costs), and keeping others in ARB.

19

The past six months of practice have shown that this incentive program is highly effective and significant for delegate voting. To ensure a smooth transition, it makes perfect sense to extend this program. I fully support this proposal!

20

As a general principle, I am against extending programs beyond the timeframe already outlined and approved by the DAO. The experiment was intended for six months, and any unused funds should be returned to the DAO.

However, in this particular case, I believe it is more important to keep the delegates with sufficient voting power incentivized during the discussion of a potential new incentives program. Therefore, I am in favor of the extension.

Now, hereā€™s my situation: I am going to vote AGAINST the proposal because I decided to vote against any extension of funds aimed at maintaining multisigs since the proposal for the Arbitrum Multi-sig Support Service has already been approved. (I apologize for not reviewing this before Snapshot)

21

I think this makes sense. When we submitted this proposal, the MSS proposal was pending a vote and we did not know when it would be available.

But I think we can migrate the funds after paying for the month of August (which corresponds to the 6 months of the original proposal) since 3 (@cattin @Frisson @JoJo) of the DIS multisig members are current MSS members.

Do you think it is possible, considering this proposal is only in snapshots?

cc @Entropy