Arbitrum Foundation Proposes Changes to DAO Governance Proposal Process

The Arbitrum Foundation has proposed a significant change to the governance structure of the Arbitrum DAO, aiming to enhance efficiency. The proposal suggests granting five entities the power to review and make recommendations on all proposals before they are sent to a vote. The five 'Arbitrum Aligned Entities' include the Foundation itself and Offchain Labs, the company behind the Arbitrum blockchain.

The move is intended to address issues such as proposal gridlock, inefficient processes, excessive spending, and a lack of accountability within the DAO. The Foundation argues that DAO delegates, tasked with decision-making on behalf of tokenholders, are overwhelmed by an avalanche of proposals, leading to inadequate management and oversight.

Reactions to the proposal vary. Some, like Arbitrum delegate Karpatkey, believe increased participation from the Foundation and Offchain Labs will help overcome operational bottlenecks. Others, including pseudonymous contributor PaperImperium, express concerns that this could diminish tokenholder control, likening governance tokens to 'Limited Partner tokens' with minimal influence. The Foundation clarifies that proposals can still be approved by delegates even if not greenlit by an Arbitrum-aligned entity.

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Disclaimer: This article has been updated to clarify Arbitrum's suggested changes to the proposal process for the Arbitrum DAO.