Arbitrum DAO Set to Allocate $145 Million to Partnerships

Wintermute Governance, the governance arm of one of crypto's largest market-making firms, is proposing that the Arbitrum DAO allocate 250 million ARB, or roughly $145 million, to bolster the Arbitrum Foundation’s “Strategic Partnership Program.”

The vote is set to close on September 26 and currently boasts a 99% approval rate, with 49 million ARB voting in favor and 293,000 ARB voting against the proposal. Once passed, the Arbitrum Foundation will detail the additional budget in its 2025 Q1 transparency report.

In the proposal, Wintermute claims that “the Foundation is at a distinct disadvantage from extending competitive offers to strategic partners due to the size of [its] overall allocation from the DAO” due to factors including vesting, existing capital lockup, and a tight budget.

The Arbitrum Foundation would be able to use the additional 250 million ARB for high-cost partnerships such as onboarding real-world assets (RWAs), expanding the funding and capabilities of Arbitrum Orbit chains, and spurring DAO activity by encouraging new and existing partners to actively participate in Arbitrum governance.

Arbitrum is the largest Ethereum Layer 2 network with $3.6 billion in total value locked (TVL), 35% more than its closest competitor, Base, according to DeFiLlama.

Despite the chain’s success, the ARB token has underperformed. ARB launched at $1.32 in March 2023 and has since plunged 56% to $0.58.

DAO Funding Track Record

Wintermute cites the Arbitrum Foundation’s proven track record as a point of consideration for voters, drawing attention to the foundation’s H1 2024 report.

The foundation’s grant approval process features a 7-step approach that takes a minimum of one month to review and complete, which has led to 212 grant approvals out of 1,436 total applications since its inception in July 2023.

Previous partnerships and grants maintained a focus on “emerging opportunities such as LRTs, RWAs and onchain gaming, ensuring the Arbitrum ecosystem remains competitive and innovative” through initiatives like the Gaming Catalyst Program (GCP), which earmarked 225 million ARB over three years for gaming on Arbitrum.

Some of Arbitrum’s notable integrations include gaming companies such as Proof of Play and Square Enix, as well as social and infra projects like Farcaster and LayerZero.