I will vote YES and fully support this proposal. It is crucial to take a look at past fundings, programs incentive programs to see and analyze their efficiency.
Otherwise the DAO will never know where the focus should be and where spending wasn’t useful and not effective at all.
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The following 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.
As we are the proposers here we obviously support the initiative and therefore we’re voting FOR it.
At the same time, we commit to bootstrapping the working group as soon as possible and working constructively to ensure that we deliver an improved program as soon as possible.
We didn’t want to complicate this too much. And three months here are not enforceable anyway, so if we come up with a program structure that we will be convinced to be a better and more sustainable one then obviously we don’t have to wait whole three months, although I have some reservations about whether three months will be enough to work it through so I see those three months as a kind of ambitious deadline within which we (as a DAO) should come to conclusions
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This is clearly needed - thank you @Sinkas and @krst for getting the ball rolling. I initially shared others’ concerns about the implications/perception of calling this a detox but ultimately the way to address that is by delivering the proposed outcomes, not by getting sidetracked into debates about naming.
One deliverable I would love to see is some kind of public report of findings from whoever does the work of integrating across the individual programs’ documentation. That would be great for delegates to have but would also be a great marketing deliverable for the ecosystem to demonstrate that we’re serious about sustainability.
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I support the Incentives Detox Proposal. Taking a three-month break to thoroughly analyze previous incentive programs and design a new, long-term strategy based on data and learnings is essential for ensuring the effectiveness and sustainability of our incentive initiatives. This reflective period will help create a more impactful and efficient program for the future growth of the Arbitrum ecosystem.
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We are in full support of this. There are too many programs right now that have substantially been putting constant downwards pressure on the token price. We think that this Detox will allow for the token to recover a bit and see how well adoption can be naturally achieved.
A few points we want to look at are:
- What is the end goal of analysis?
- In what scenario would we want to maintain the Detox for longer? We feel there are substantial points to be made to only continue one or even no programs for a while and see how the community, dapps, and token price reacts.
Discussed in other venues, but sharing here as well. Probably need a rebranded name before onchain vote something like Benefit Reflection Period or something.
a) I think there are like <50 ppl on this earth that could manage a program to collect, interpret, analyze, and prepare all the data to create a reformed Incentive Program. We need to break it down into multiple sub projects and baby step through each milestone. Not sure 3mo is even enough time to coordinate and complete this exercise.
b) We over-index on the micro; we need to focus on the meso/macro. All the analysis i’ve seen is at the project level, it should be at the arb1 level and vs the competition. We should start here, cause if our programs are returning better KPIs/OKRs, then what we have been doing has actually been a success. Meso/Macro analysis should be the Deliverable during the “Benefit Reflection Period” aka detox.
My Recommendation is also that the incentive working group should focus on the deliverables we want to see at the Micro/Meso/Macro Level. Then allow open submission with multiple bounties on those deliverables. Then the working group can vote on the winners. I think this would lead to a better outcome than a single entity performing the analysis, given I believe the solution this proposal is looking for is an incredibly complex problem.
I’ll abstain for now cause this is probably more of a social contract or informal agreement. I need to think more about formalizing it.
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I fully support this proposal. I believe that a 3-months break to analyse the effectiveness of incentives is essential. The evaluation step is a key element for every program in order to see how to improve it. The DAO needs to adopt a long-term approach and this proposal goals in that direction, allowing us to work on an efficient strategy to use its resources in the best way possible.
I am voting FOR this proposal.
When the STIP Bridge proposal was launched, I strongly opposed its implementation.
The data on the STIP results was not available, and the distribution of incentives for the LTIPP had not yet begun. There was no data-based justification (and there still isn’t) for renewing the STIP by 50%. This was approved, even with allowed incentives criteria different from those applied by the LTIPP Council to approve or reject proposals.
The main justification for its approval was that we had to compete against other L2s that also offer incentives. I think there was also a fear of internal competition among protocols because the beneficiaries of the LTIPP were not the same as those of the STIP.
Now we have an analysis and conclusions from @BlockworksResearch report on the STIP performance, which I invite everyone to read:
Also, after B.STIP was approved, the LTIPP also faced criticism and questioning in its process. As part of the workstream, we identified along the way some design flaws that could have improved the experience for applicants. However, to conduct a thorough analysis, we need to wait until the process is complete and we have all the data available.
As I stated when opposed to STIP bridge, now we need to wait for the data from the B.STIP and LTIPP to become available and require the cooperation of incentive recipients -reports and final reports- in their analyses to build the appropriate program:
For this reason, I believe the use of the word “detox” is appropriate. It is not a detox from using incentives as a mechanism for growth, diversification of the treasury, and competition against other L2s. What has been done so far has had value and provides us with sufficient data to move forward.
It is a detox from the hasty deployment of incentives without proper analysis, and an acknowledgment that we need time to understand how to prepare an appropriate system.
Finally, I agree with other comments that it is not necessary to set a specific deadline. We should take whatever time is needed to gain clarity on the data and the path forward.
We support this proposal as it provide a sensible 3-month pause on the incentive programs. This break allows for a thorough analysis of current data to develop a more effective and sustainable long-term incentive strategy. Such a measured, data-driven approach is essential for ensuring the best use of resources and the overall health of the Arbitrum ecosystem.
We’re voting FOR this proposal. A pause allows for critical reflection on our incentive strategies. We’re keen to see a diverse auditing working group appointed (Council of Finance?!), ensuring a comprehensive analysis that goes beyond surface-level metrics. This approach should yield valuable insights for future decision-making.
Camelot is voting FOR this proposal.
Contrary to popular belief, not all protocols want incentives to be indiscriminately funneled into the chain; they want it done in a way that is fair and beneficial for all participants. We believe that more specific and tailored rules should be created to better serve users, meet the economic and growth goals of the DAO, and avoid secondary detrimental effects on protocols.
Specifically, any incentive program should avoid fostering mechanisms where protocols in the same category start a race to the bottom on fees, rebates, or other economic parameters. This situation is generally unsustainable and unrealistic, as the costs are effectively subsidized by the grant itself and thus by the DAO. It also creates an environment where protocols deployed on non-Arbitrum chains can maintain a revenue stream while driving our chain’s portion to zero. In this sense, we appreciate, for example, the gentleman’s agreement for perpetual protocols where the rebating of fees was capped at 75% across all protocols. We should aim for similar rules for several categories of protocols.
There is also an overarching need to read and reflect on data reports. Blockworks is doing a great job analyzing the first STIP results, and we hope every member of the DAO with an opinion on incentive programs will take the time to read the reports, even if they are complex. We need to incorporate all of these findings into future programs. We also need to be aware that receiving this type of data months after a program has closed, while positive, can have a limited impact compared to having data analyzed during the different phases of the program, including when it is live.
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Excellent point, @Sinkas. I have been participating in the Cartographers Syndicate, a community of individuals and teams dedicated to advancing the Web3 grants ecosystem, and I’ve started research on the first phase of Arbitrum grants. From my analysis, I can see that more than 180k USD was spent on unfinished projects, among other inputs like:
Of course, the contexts are different, and sometimes the teams themselves realize that it no longer makes sense to continue with the project and ask for more resources. In other words, this doesn’t show a failure of the reviewers and supporters, but rather a failure of the grant mechanisms in general.
I vote FOR this proposal, as I believe that a better-structured grant framework can indeed contribute to the growth of the ecosystem and generate impact through the DAO treasury.
I’m posting my rationale later, but in short, I couldn’t agree more with this proposal. I’m a firm believer that experiments are necessary, but what’s most important are the results, the analysis of those results, and the data that help us recalibrate our strategy if needed, refining our direction to reach our North Star.
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We vote FOR the proposal on Snapshot.
We consider the STIP (and its bridge) and LTIPP are purely experiments that need deep analysis and considerations for its complete version of the mechanism. To do so, the DAO requires dedicated resources including time, thus having the detox period makes perfect sense. We appreciate the work by all the contributors including L2BEAT, Matt from StableLab, the LTIPP council members and advisors, so far and in the future.
As dk3 suggested, we would also suggest a name to clarify that it’s not just about “detoxing” but more of a reflection and review. Incentives Program Reflection Period is our suggestion.
Commenting Rationale below
I support the Incentives Detox Proposal, which wisely advocates for a three-month pause to reassess and refine the Arbitrum DAO’s incentive programs. This break is crucial for analyzing past initiatives, improving accountability, and designing a more effective, data-driven incentives framework.
The proposal’s emphasis on forming a dedicated working group is a key strength, ensuring that diverse stakeholders contribute to a well-rounded, long-term strategy. Flexibility in the detox period and clearer objectives for future programs are necessary to align with the DAO’s broader goals and remain competitive in the ecosystem.
I believe the new incentives proposal should closely tie to growth objectives, recognizing that incentives are merely a tool to drive broader ecosystem development. This initiative represents a strategic step towards more sustainable growth for Arbitrum.
See Voting Rationale, here: Alex Lumley (Savvy DAO) Delegate Communication Thread - #2 by AlexLumley
The UADP is in favor of this. There has been a massive influx of ARB into the circulating supply due to all of the recent governance proposals creating unprecedented sell pressure. This should help ease off some of this for these few months as we re-analyze what to do.
Some questions to consider are:
- At what point will we consider a pause a good idea and decide to continue doing this into the future.
- Developing a framework for continuing this detox for longer than a few months
- What other Detox proposals can we allocate? More future pause on other spending too?
Fully agree, voting For. I would even go further and say we should tighten up the spending in general. The emissions rate for ARB is just too damn high!
I think we have done a great job at attracting protocols and users with these incentives but at the same time, the amount of ARB we spent to do it was MASSIVE… I am very excited to see the results of the analysis… and personally… I would LOVE to see more incentives that lock some of the ARB that users receive, so that the incentives reward and attract long term believers, as opposed to mercenary liquidity providers (in theory). We will see if the analysis agrees with that hypothesis or not.
I voted FOR this proposal at the temp check stage. We’ve deployed hundreds of millions of dollars in incentives across four programs. It’s time to take a step back, review performance, and align on our goals for incentives going forward.
I appreciate the comment from @Matt_StableLab reflecting on incentive program needs going forward. I’m aligned with prioritizing clear objectives, stronger reporting, and a greater emphasis on marketing.
DAOplomats is voting FOR on Snapshot.
We were pleased to see this proposal which we believe is well overdue, so thank you L2BEAT for putting this together.
We have been reviewing the various incentive analyses carried out by different stakeholders within the DAO. However, having this dedicated timeframe and working group with little/no distractions to really dial in on learnings from past programs is imperative and we are in full support. We would also love to be a part of this WG if this proposal passes.