Abstract - On June 12th 2024, the DAO held an election for the role of STEP program manager to oversee ~$30 million diversified into liquid, stable and yield bearing RWAs .
Steakhouse Financial won the vote with 60% in favor of their selection. However, the tally vote earmarked 100k ARB as payment to program manager for one year (which converted to $86,581) while Steakhouse quoted a fee of $174,000 in their application. This proposal seeks input on the right way forward, with the options to
Motivation - On April 10th 2024, the DAO approved 35 million ARB for diversification into RWAs. Of this, 100,000 ARB was budgeted for the role of program manager. The Arbitrum Foundation got an average price of 87 cents per ARB, resulting in $86,581 to pay the program manager.
In their application, Steakhouse quoted $174,000 per year. Given the funds received from the 100,000 ARB sale ($86,531) are less than the amount necessary to pay for a full year of the Program Manager’s services, we need to either shorten their term to 6 months or approve an additional 6 months pay (from yield earned via the program). We can also declare the earlier election null and void while putting out a call for program managers willing to serve at $86,581 for a year. If there is no program manager to oversee investments, assets are liquidated and returned to the DAO.
Rationale - While writing the Tally proposal, I budgeted 100k ARB for the program manager role based on a quotation received from another provider and the prevailing ARB price at the time.
Steakhouse financial and the other applicants prepared a budget in dollar value, not ARB. As a result, i under-budgeted the program manager role in the STEP program and now need approval from the DAO on provisioning either a shortened tenure of 6 months or additional funding to complete the one year. The additional funds will be requested from the yield earned on the RWAs (estimated at between $1-2 million per year) to prevent ARB liquidations. Alternatively, we can hold a new RFP seeking program managers at a fixed price of $86,581 for the year and invalidate the earlier election.
Specifications - The STEP program is one of the largest diversification initiatives at any DAO, seeking to diversify our treasury while simultaneously growing the RWA ecosystem. Given the complications that can arise in managing the large sums of money, it is imperative that the DAO have a capable program manager to recommend liquidations,conduct firedrills, monitor interest payments to the DAO treasury, and track underlying changes in service providers.
Steps to Implement - After ratification of their role as STEP program manager and whether it is 6 months or 1 year, the Arbitrum foundation will sign an agreement with Steakhouse Financial and begin investments into selected RWA providers.
Timeline -
Post on forum
Upload on Snapshot (Thursday, 12th September)
Foundation negotiates agreement with Steakhouse and pays the first 6 months of their payment from the initial 100,000 ARB budgeted for in the STEP proposal
After RWA yield is returned to the treasury, this proposal is taken to Tally requesting balance of $87,419 (provided one year tenure is approved in the snapshot)
Overall Cost - If the entire one year tenure is ratified, the cost to the DAO is $87,419. If 6 month tenure is approved, the cost is needing another election for program manager in a shortened time. If the proposal is rejected, we liquidate all $30 million and return assets to the DAO. If a new RFP is held seeking program manager services for $86,581 for a year, we delay the start of the STEP program and possibly get a less capable pool of applicants at the lower price point.
Work done in shepherding this proposal is paid for through a Thrivecoin firestarter grant to the Arbitrum treasury and sustainability group.
Abstract - On June 12th 2024, the DAO held an election for the role of STEP program manager to oversee ~$30 million diversified into liquid, stable and yield bearing RWAs .
Steakhouse Financial won the vote with 60% in favor of their selection. However, the tally vote earmarked 100k ARB as payment to program manager for one year (which converted to $86,581) while Steakhouse quoted a fee of $174,000 in their application. This proposal seeks input on the right way forward, with the options to
Motivation - On April 10th 2024, the DAO approved 35 million ARB for diversification into RWAs. Of this, 100,000 ARB was budgeted for the role of program manager. The Arbitrum Foundation got an average price of 87 cents per ARB, resulting in $86,581 to pay the program manager.
In their application, Steakhouse quoted $174,000 per year. Given the funds received from the 100,000 ARB sale ($86,531) are less than the amount necessary to pay for a full year of the Program Manager’s services, we need to either shorten their term to 6 months or approve an additional 6 months pay (from yield earned via the program). We can also declare the earlier election null and void while putting out a call for program managers willing to serve at $86,581 for a year. If there is no program manager to oversee investments, assets are liquidated and returned to the DAO.
Rationale - While writing the Tally proposal, I budgeted 100k ARB for the program manager role based on a quotation received from another provider and the prevailing ARB price at the time.
Steakhouse financial and the other applicants prepared a budget in dollar value, not ARB. As a result, i under-budgeted the program manager role in the STEP program and now need approval from the DAO on provisioning either a shortened tenure of 6 months or additional funding to complete the one year. The additional funds will be requested from the yield earned on the RWAs (estimated at between $1-2 million per year) to prevent ARB liquidations. Alternatively, we can hold a new RFP seeking program managers at a fixed price of $86,581 for the year and invalidate the earlier election.
Specifications - The STEP program is one of the largest diversification initiatives at any DAO, seeking to diversify our treasury while simultaneously growing the RWA ecosystem. Given the complications that can arise in managing the large sums of money, it is imperative that the DAO have a capable program manager to recommend liquidations,conduct firedrills, monitor interest payments to the DAO treasury, and track underlying changes in service providers.
Steps to Implement - After ratification of their role as STEP program manager and whether it is 6 months or 1 year, the Arbitrum foundation will sign an agreement with Steakhouse Financial and begin investments into selected RWA providers.
Timeline -
Post on forum
Upload on Snapshot (Thursday, 12th September)
Foundation negotiates agreement with Steakhouse and pays the first 6 months of their payment from the initial 100,000 ARB budgeted for in the STEP proposal
After RWA yield is returned to the treasury, this proposal is taken to Tally requesting balance of $87,419 (provided one year tenure is approved in the snapshot)
Overall Cost - If the entire one year tenure is ratified, the cost to the DAO is $87,419. If 6 month tenure is approved, the cost is needing another election for program manager in a shortened time. If the proposal is rejected, we liquidate all $30 million and return assets to the DAO. If a new RFP is held seeking program manager services for $86,581 for a year, we delay the start of the STEP program and possibly get a less capable pool of applicants at the lower price point.
Work done in shepherding this proposal is paid for through a Thrivecoin firestarter grant to the Arbitrum treasury and sustainability group.
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/41?u=mcfly
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/41?u=mcfly
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/39?u=euphoria
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/40?u=bruce
we prefer they receive additional funds
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/38
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/36?u=ocandocrypto
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/35?u=tane
https://forum.arbitrum.foundation/t/seed-latam-delegate-communication-thread/13895/47?u=seedgov
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/33?u=blockworksresearch
https://forum.arbitrum.foundation/t/gfx-labs-delegate-communication-thread/
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/31
Make right the dollar denominated problem
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/30?u=griff
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/29
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/27?u=tekr0x.eth
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/26?u=0x_ultra
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/22?u=0xdonpepe
N/A
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/17?u=larva
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/16?u=0xtalvo.eth_mty
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/15?u=jojo
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/8?u=duokongcrypto
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/14?u=pennblockchain
yield earned from RWAs covers the shortfall. more voting is opportunity cost. cutting cost may downgrade quality of the PM
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/39?u=euphoria
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/40?u=bruce
we prefer they receive additional funds
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/38
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/36?u=ocandocrypto
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/35?u=tane
https://forum.arbitrum.foundation/t/seed-latam-delegate-communication-thread/13895/47?u=seedgov
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/33?u=blockworksresearch
https://forum.arbitrum.foundation/t/gfx-labs-delegate-communication-thread/
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/31
Make right the dollar denominated problem
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/30?u=griff
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/29
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/27?u=tekr0x.eth
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/26?u=0x_ultra
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/22?u=0xdonpepe
N/A
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/17?u=larva
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/16?u=0xtalvo.eth_mty
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/15?u=jojo
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/8?u=duokongcrypto
https://forum.arbitrum.foundation/t/non-constitutional-terms-of-tenure-for-step-program-manager/26675/14?u=pennblockchain
yield earned from RWAs covers the shortfall. more voting is opportunity cost. cutting cost may downgrade quality of the PM
Thank you to everyone who participated in the discussion and voted in the Snapshot poll.
As an update from our side, we have now signed our service contract and are awaiting confirmation regarding the funds’ deployment and the associated transaction data.
Looking forward to providing the first report soon!
Thank you to everyone who participated in the discussion and voted in the Snapshot poll.
As an update from our side, we have now signed our service contract and are awaiting confirmation regarding the funds’ deployment and the associated transaction data.
Looking forward to providing the first report soon!
Additional funds for a year to cover, not amend, the existing agreement. The DAO needs to make good on the terms presented by the service provider and ratified by the DAO constituents.
Cutting the service provider's term short as a result of this administrative failure shouldn't even be up for discussion. This proposal simply should have been a request for additional funding to cover the shortfall.
Additional funds for a year to cover, not amend, the existing agreement. The DAO needs to make good on the terms presented by the service provider and ratified by the DAO constituents.
Cutting the service provider's term short as a result of this administrative failure shouldn't even be up for discussion. This proposal simply should have been a request for additional funding to cover the shortfall.
The program manager election passed in June 2024 and Steakhouse has been providing services (duties specified in the March 20th proposal) since the "pre-allocation" phase that began shortly after.
There is also a "post-allocation" phase with a different payment schedule. It appears the tenure we're discussing will start at this phase after negotiations with the foundation.
@thedevanshmehta, two questions:
Additional funds for a year to cover, not amend, the existing agreement. The DAO needs to make good on the terms presented by the service provider and ratified by the DAO constituents.
Cutting the service provider's term short as a result of this administrative failure shouldn't even be up for discussion. This proposal simply should have been a request for additional funding to cover the shortfall.
Additional funds for a year to cover, not amend, the existing agreement. The DAO needs to make good on the terms presented by the service provider and ratified by the DAO constituents.
Cutting the service provider's term short as a result of this administrative failure shouldn't even be up for discussion. This proposal simply should have been a request for additional funding to cover the shortfall.
The program manager election passed in June 2024 and Steakhouse has been providing services (duties specified in the March 20th proposal) since the "pre-allocation" phase that began shortly after.
There is also a "post-allocation" phase with a different payment schedule. It appears the tenure we're discussing will start at this phase after negotiations with the foundation.
@thedevanshmehta, two questions:
Here is an update on the STEP 1 PM's (Steakhouse’s) payment:
As per this proposal, in addition to being paid $86,581 USDC (from the initially allocated 100K ARB), Steakhouse has received $48,193.75 USDC from the Arbitrum Foundation for their tenure as the STEP 1 PM. This brings Steakhouse’s total amount received as STEP 1 PM to $134,755 USDC. The proposal mentions that this additional $48,193.75 USDC should come from the yield generated on the DAO’s STEP 1 allocation, that it should only be paid once all yield from STEP 1 is returned to the DAO treasury and only if the DAO agree to this via a separate Tally proposal.
Here is an update on the STEP 1 PM's (Steakhouse’s) payment:
As per this proposal, in addition to being paid $86,581 USDC (from the initially allocated 100K ARB), Steakhouse has received $48,193.75 USDC from the Arbitrum Foundation for their tenure as the STEP 1 PM. This brings Steakhouse’s total amount received as STEP 1 PM to $134,755 USDC. The proposal mentions that this additional $48,193.75 USDC should come from the yield generated on the DAO’s STEP 1 allocation, that it should only be paid once all yield from STEP 1 is returned to the DAO treasury and only if the DAO agree to this via a separate Tally proposal.
The Arbitrum Foundation believes that this latter detail was an oversight because:
Accordingly, the Arbitrum Foundation considers the aforementioned Tally proposal to re-confirm that the excess funds to pay Steakhouse should come from the STEP 1 yield, to be redundant. The Arbitrum Foundation will deduct the excess $48,193.75 USDC that has already been paid to Steakhouse, from the STEP 1 yield (as long as the DAO has no complaints).
As a side note, now that the Arbitrum Treasury Management Committee has overridden the STEP 1 PM’s mandate (which was meant to run through till September 2025), Steakhouse will not receive any further payments for their tenure as STEP 1 PM, as they have already been paid up until the end of June 2025. Accordingly, their work agreement has been terminated.
I find it interesting that we are talking about managing money with professionals in one hand but then talking about paying them with future yield in another.
Yes this is a good way to reduce the cost to the DAO by paying the balance out of future yield, which effectively turns this into an IOU situation.
I find it interesting that we are talking about managing money with professionals in one hand but then talking about paying them with future yield in another.
Yes this is a good way to reduce the cost to the DAO by paying the balance out of future yield, which effectively turns this into an IOU situation.
If it is on the DAOs' shoulders that a late conversion happened based on market conditions to get to a USD value, then it should be on the DAOs' shoulders to meet that obligation.
At the same time if it was ARB that was requested then it should be ARB that is paid. Because if the market went the other way then it would have been a bonus in pay.
It is honorable to meet the duty of properly paying someone for this important role. This is a big undertaking.
I like the proposal of using interest to pay as it is easier on the DAO (But does reduce culpability if it was the DAO's fault).
My suggestion to the amendement is that all interest earned is earmarked to fill the remaining debt first (shortage in payment) before going anywhere else.
Here is an update on the STEP 1 PM's (Steakhouse’s) payment:
As per this proposal, in addition to being paid $86,581 USDC (from the initially allocated 100K ARB), Steakhouse has received $48,193.75 USDC from the Arbitrum Foundation for their tenure as the STEP 1 PM. This brings Steakhouse’s total amount received as STEP 1 PM to $134,755 USDC. The proposal mentions that this additional $48,193.75 USDC should come from the yield generated on the DAO’s STEP 1 allocation, that it should only be paid once all yield from STEP 1 is returned to the DAO treasury and only if the DAO agree to this via a separate Tally proposal.
Here is an update on the STEP 1 PM's (Steakhouse’s) payment:
As per this proposal, in addition to being paid $86,581 USDC (from the initially allocated 100K ARB), Steakhouse has received $48,193.75 USDC from the Arbitrum Foundation for their tenure as the STEP 1 PM. This brings Steakhouse’s total amount received as STEP 1 PM to $134,755 USDC. The proposal mentions that this additional $48,193.75 USDC should come from the yield generated on the DAO’s STEP 1 allocation, that it should only be paid once all yield from STEP 1 is returned to the DAO treasury and only if the DAO agree to this via a separate Tally proposal.
The Arbitrum Foundation believes that this latter detail was an oversight because:
Accordingly, the Arbitrum Foundation considers the aforementioned Tally proposal to re-confirm that the excess funds to pay Steakhouse should come from the STEP 1 yield, to be redundant. The Arbitrum Foundation will deduct the excess $48,193.75 USDC that has already been paid to Steakhouse, from the STEP 1 yield (as long as the DAO has no complaints).
As a side note, now that the Arbitrum Treasury Management Committee has overridden the STEP 1 PM’s mandate (which was meant to run through till September 2025), Steakhouse will not receive any further payments for their tenure as STEP 1 PM, as they have already been paid up until the end of June 2025. Accordingly, their work agreement has been terminated.
I find it interesting that we are talking about managing money with professionals in one hand but then talking about paying them with future yield in another.
Yes this is a good way to reduce the cost to the DAO by paying the balance out of future yield, which effectively turns this into an IOU situation.
I find it interesting that we are talking about managing money with professionals in one hand but then talking about paying them with future yield in another.
Yes this is a good way to reduce the cost to the DAO by paying the balance out of future yield, which effectively turns this into an IOU situation.
If it is on the DAOs' shoulders that a late conversion happened based on market conditions to get to a USD value, then it should be on the DAOs' shoulders to meet that obligation.
At the same time if it was ARB that was requested then it should be ARB that is paid. Because if the market went the other way then it would have been a bonus in pay.
It is honorable to meet the duty of properly paying someone for this important role. This is a big undertaking.
I like the proposal of using interest to pay as it is easier on the DAO (But does reduce culpability if it was the DAO's fault).
My suggestion to the amendement is that all interest earned is earmarked to fill the remaining debt first (shortage in payment) before going anywhere else.
Gm, gm :sparkles:
The results are in for the Terms of Tenure for STEP program manager off-chain proposal.
See how the community voted and more Arbitrum stats: https://dhive.io/proposal/1372
Gm, gm :sparkles:
The results are in for the Terms of Tenure for STEP program manager off-chain proposal.
See how the community voted and more Arbitrum stats: https://dhive.io/proposal/1372
Vote: (1st) Additional funds for one year, (2nd) 6 months from available funds, (3rd) New election at $86,581 per year, (4th) Liquidation of RWAs and STEP, (5th) Abstain
Title and Proposal Link: Non-Constitutional: Terms of Tenure for STEP Program Manager
Voting Rationale Link: https://forum.arbitrum.foundation/t/alex-lumley-savvy-dao-delegate-communication-thread/26147/22
Vote: (1st) Additional funds for one year, (2nd) 6 months from available funds, (3rd) New election at $86,581 per year, (4th) Liquidation of RWAs and STEP, (5th) Abstain
Title and Proposal Link: Non-Constitutional: Terms of Tenure for STEP Program Manager
Voting Rationale Link: https://forum.arbitrum.foundation/t/alex-lumley-savvy-dao-delegate-communication-thread/26147/22
=== Commentary on Proposal ===
Several DAO members raised concerns about the lack of foresight in managing ARB volatility and converting it to USD. This is a recurrent problem and must be addressed in the future. As @Frisson mentioned, we should have better plans in place to manage currency fluctuations and create buffer zones in our budget. The conversation around using ARB as the standard currency, as @thedevanshmehta noted, also continues to evolve, but there are valid concerns about the liquidity and volatility of ARB in relation to USD.
In conclusion, while mistakes were made in the budgeting process, securing additional funds for the one-year tenure is the most practical solution, ensuring the continuity of the STEP program without unnecessary delays or disruptions. It also provides an opportunity to learn from these challenges and improve our budgeting and treasury management processes moving forward.
Voted For - makes total sense to support an existing budget that was agreed upon.
The issues that many DAO programs are running into around the dependence on ARB price is something we need a longer term solve for (treasury management working group is tackling this) - and we should not slow down current initiatives because of the lack of that long term solve.
Hey! I understand the situation and appreciate the clarification. It’s not your fault—you’ve been doing great all along! After all, this is a free market, and as a newly launched token, price fluctuations are inevitable. No one can predict price fluctuations, just as I once thought ARB would soon reach $5 lol. My earlier point was simply to discuss whether there could be a solution to accept ARB as the base currency. Of course, I understand that’s difficult. Anyway, let’s remember this lesson so that we can handle similar situations better in the future. Thanks!
gm, voted FOR additional funds for one year.
I echo WinVerse above. Let's get this done and evaluate results.
gm, voted FOR additional funds for one year.
I echo WinVerse above. Let's get this done and evaluate results.
There is more benefit to starting a thing and seeing it to completion. Providing additional funds does just that and would allow the program manager complete their original term of service so we can have a more wholesome analysis of their work at the end of the 12 months.
DAOplomats voted in favor of Additional funds for one year.
There is more benefit to starting a thing and seeing it to completion. Providing additional funds does just that and would allow the program manager complete their original term of service so we can have a more wholesome analysis of their work at the end of the 12 months.
I vote for "Additional funds for one year" because I believe the DAO should cover this cost. The proposer didn't account for the ARB price changes, especially when paying Steakhouse, who quoted in stablecoin and the DAO accepted.
While it's unfortunate that the ARB price dropped, it’s not Steakhouse's fault, and they shouldn’t have to absorb this loss. I also agree with @duokongcrypto that using ARB instead of stablecoin might help avoid such issues in the future, as long as we handle price changes carefully.
The ITU Blockchain Delegation support continuing with a 1-year tenure for Steakhouse Financial as STEP Program Manager. This option provides stability, enables better execution of long-term strategy, and maximizes returns from the $30M in RWA investments. The additional funding gap can be covered by RWA returns, ensuring sustainability. For these reasons, we voted (1st) Additional funds for one year, (2nd) 6 months from available funds, (3rd) New election at $86,581 per year, (4th) Abstain, (5th) Liquidation of RWAs and STEP.
I voted "New election at $86,581 per year". Spending in the DAO became out of control imho. We have to take more care instead of increasing spendings out of the treasury. Arbitrum has problems getting tracation and the token price is definitely one problem of this.
We're voting FOR additional funds for one year. Here's our ranking of the options, from most to least preferred:
Below are the opinions of the UADP:
We voted for Additional funds for one year, 6 months from available funds, Liquidation of RWAs and STEP, New election at $86,581 per year, Abstain—in that order. Liabilities must be paid in correspondence with the dollar amount elected upon passing of proposals. There is no need to return to ground zero, so the continuation with Steakhouse is prudent.
I voted in favour of additional funds for one year. Budgets were already agreed on and because of a market turn turned out to be insufficient. Moreover, the proposal already was put in place and time and resources invested on it.
Vote: (1st) Additional funds for one year, (2nd) 6 months from available funds, (3rd) New election at $86,581 per year, (4th) Liquidation of RWAs and STEP, (5th) Abstain
Title and Proposal Link: Non-Constitutional: Terms of Tenure for STEP Program Manager
Voting Rationale Link: https://forum.arbitrum.foundation/t/alex-lumley-savvy-dao-delegate-communication-thread/26147/22
Vote: (1st) Additional funds for one year, (2nd) 6 months from available funds, (3rd) New election at $86,581 per year, (4th) Liquidation of RWAs and STEP, (5th) Abstain
Title and Proposal Link: Non-Constitutional: Terms of Tenure for STEP Program Manager
Voting Rationale Link: https://forum.arbitrum.foundation/t/alex-lumley-savvy-dao-delegate-communication-thread/26147/22
=== Commentary on Proposal ===
Several DAO members raised concerns about the lack of foresight in managing ARB volatility and converting it to USD. This is a recurrent problem and must be addressed in the future. As @Frisson mentioned, we should have better plans in place to manage currency fluctuations and create buffer zones in our budget. The conversation around using ARB as the standard currency, as @thedevanshmehta noted, also continues to evolve, but there are valid concerns about the liquidity and volatility of ARB in relation to USD.
In conclusion, while mistakes were made in the budgeting process, securing additional funds for the one-year tenure is the most practical solution, ensuring the continuity of the STEP program without unnecessary delays or disruptions. It also provides an opportunity to learn from these challenges and improve our budgeting and treasury management processes moving forward.
Voted For - makes total sense to support an existing budget that was agreed upon.
The issues that many DAO programs are running into around the dependence on ARB price is something we need a longer term solve for (treasury management working group is tackling this) - and we should not slow down current initiatives because of the lack of that long term solve.
Hey! I understand the situation and appreciate the clarification. It’s not your fault—you’ve been doing great all along! After all, this is a free market, and as a newly launched token, price fluctuations are inevitable. No one can predict price fluctuations, just as I once thought ARB would soon reach $5 lol. My earlier point was simply to discuss whether there could be a solution to accept ARB as the base currency. Of course, I understand that’s difficult. Anyway, let’s remember this lesson so that we can handle similar situations better in the future. Thanks!
gm, voted FOR additional funds for one year.
I echo WinVerse above. Let's get this done and evaluate results.
gm, voted FOR additional funds for one year.
I echo WinVerse above. Let's get this done and evaluate results.
There is more benefit to starting a thing and seeing it to completion. Providing additional funds does just that and would allow the program manager complete their original term of service so we can have a more wholesome analysis of their work at the end of the 12 months.
DAOplomats voted in favor of Additional funds for one year.
There is more benefit to starting a thing and seeing it to completion. Providing additional funds does just that and would allow the program manager complete their original term of service so we can have a more wholesome analysis of their work at the end of the 12 months.
I vote for "Additional funds for one year" because I believe the DAO should cover this cost. The proposer didn't account for the ARB price changes, especially when paying Steakhouse, who quoted in stablecoin and the DAO accepted.
While it's unfortunate that the ARB price dropped, it’s not Steakhouse's fault, and they shouldn’t have to absorb this loss. I also agree with @duokongcrypto that using ARB instead of stablecoin might help avoid such issues in the future, as long as we handle price changes carefully.
The ITU Blockchain Delegation support continuing with a 1-year tenure for Steakhouse Financial as STEP Program Manager. This option provides stability, enables better execution of long-term strategy, and maximizes returns from the $30M in RWA investments. The additional funding gap can be covered by RWA returns, ensuring sustainability. For these reasons, we voted (1st) Additional funds for one year, (2nd) 6 months from available funds, (3rd) New election at $86,581 per year, (4th) Abstain, (5th) Liquidation of RWAs and STEP.
I voted "New election at $86,581 per year". Spending in the DAO became out of control imho. We have to take more care instead of increasing spendings out of the treasury. Arbitrum has problems getting tracation and the token price is definitely one problem of this.
We're voting FOR additional funds for one year. Here's our ranking of the options, from most to least preferred:
Below are the opinions of the UADP:
We voted for Additional funds for one year, 6 months from available funds, Liquidation of RWAs and STEP, New election at $86,581 per year, Abstain—in that order. Liabilities must be paid in correspondence with the dollar amount elected upon passing of proposals. There is no need to return to ground zero, so the continuation with Steakhouse is prudent.
I voted in favour of additional funds for one year. Budgets were already agreed on and because of a market turn turned out to be insufficient. Moreover, the proposal already was put in place and time and resources invested on it.
I vote for "Additional funds for one year" because I believe the DAO should cover this cost. The proposer didn't account for the ARB price changes, especially when paying Steakhouse, who quoted in stablecoin and the DAO accepted.
While it's unfortunate that the ARB price dropped, it’s not Steakhouse's fault, and they shouldn’t have to absorb this loss. I also agree with @duokongcrypto that using ARB instead of stablecoin might help avoid such issues in the future, as long as we handle price changes carefully.
Btw, I’m so interested in discussing how we manage these kinds of issues as the DAO grows. Balancing our budget and dealing with external services effectively will be important as we move forward
We're voting FOR additional funds for one year. Here's our ranking of the options, from most to least preferred:
This ranking prioritizes program continuity and respects the election results while balancing fiscal responsibility. The top two choices maintain Steakhouse Financial's involvement, differing only in duration. A new election is less desirable but preferable to program termination. Abstaining fails to address the issue, while liquidation is the least favorable, potentially wasting resources and community efforts.
Here are the reasons to Support Option 2 (Allocating Additional Funds to Complete the Program Manager’s One-Year Term):
Here are the reasons to Support Option 2 (Allocating Additional Funds to Complete the Program Manager’s One-Year Term):
The following reflects the views of the Lampros Labs DAO governance team, composed of @Blueweb, @Euphoria, and Hirangi Pandya (@Nyx), based on our combined research, analysis, and ideation.
We are voting FOR the proposal and support providing additional funds to cover the entire 1-year tenure.
The following reflects the views of the Lampros Labs DAO governance team, composed of @Blueweb, @Euphoria, and Hirangi Pandya (@Nyx), based on our combined research, analysis, and ideation.
We are voting FOR the proposal and support providing additional funds to cover the entire 1-year tenure.
After investing significant time and effort into setting up the STEP program and electing a program manager for a year, it would be a mistake to risk losing that progress for the sake of a shorter-term contract. Although we recognize this situation arose due to an operational mistake, steps should be taken to avoid such errors in the future.
We have voted in the following order.
Yes, we at Arbitrum Dao should make a change to pass on the value and it is essential that more people want to hold an ARB as well as gain confidence. Something like ARB is money, not ARB is an iceberg (melting)
Voting to keep the project running because I think it is too valuable to let die, however I'll echo others that this is becoming a recurring problem where projects are wanting to pay amounts in a USD price but keeping the value in ARB tokens.
This is a difficult one. I voted for additional funds for a year. It’s been a tremendous effort to run this project for the DAO, and it aligns with our long-term goals.
However, does this set a precedent for project managers or service providers to convert their funds to USD after passing a proposal?
We understand these are challenging times for the market, but… can we learn from this?
This is a difficult one. I voted for additional funds for a year. It’s been a tremendous effort to run this project for the DAO, and it aligns with our long-term goals.
However, does this set a precedent for project managers or service providers to convert their funds to USD after passing a proposal?
We understand these are challenging times for the market, but… can we learn from this?
Thinking about the sustainability of the token on one side and the service providers over time—these are interesting conversations I’d love to understand and explore.
After consideration, the @SEEDgov delegation has decided to vote “Additional funds for one year” on this proposal at the Snapshot vote.
After consideration, the @SEEDgov delegation has decided to vote “Additional funds for one year” on this proposal at the Snapshot vote.
We recognise the tremendous effort it has taken to manage this proposal and that is why we see no point in going any other way than to honour the agreement and pay Steakhouse for the whole year. It would even be a dangerous precedent to take any other decision, as we would be sending the message to service providers that the volatility of ARB and the difficulties in converting it to stables that we face could somehow alter the agreement reached with the DAO.
For all these reasons, it is reasonable to use part of the yield obtained to cover the corresponding annual payment.
We vote for additional funds for one year as the first choice on Snapshot.
While the DAO needs to address the issue around the conversation between the fiat and ARB token, we agree that the initial promise and contract with service providers should be respected and followed through with funds compensated by the treasury. Now, it's more critical to execute the program than delaying the operations.
Blockworks Research is in favor of providing additional funds to cover the full year of tenure for the STEP program manager. Treasury diversification and management is no joke, and we think that it would be best to provide the best incentives so that this is executed properly.
We stress though that this is becoming a recurrent problem for the DAO, and a greater payment plan needs to be structured. Multiple initiatives have fallen to the wayside because of ARB<>USD conversion problems.
We are in favor of allocating additional funds to cover the full one-year tenure for the STEP Program Manager. This decision is critical for ensuring continuity, stability, and avoiding operational disruptions to a program that has already proven to be a successful DAO initiative.
We are in favor of allocating additional funds to cover the full one-year tenure for the STEP Program Manager. This decision is critical for ensuring continuity, stability, and avoiding operational disruptions to a program that has already proven to be a successful DAO initiative.
We support moving forward without delay, collecting yield ASAP and ensuring that the program runs smoothly for the entire year, while learning from these challenges to improve proposal execution in the future.
We support allocating the additional funds to extend contract for the full one-year term, recognizing the significant effort invested in setting up the STEP program. A six-month term risks disrupting the program’s momentum and creating operational inefficiencies, whereas securing their management for the entire year ensures continuity and stability.
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.
We’re voting FOR the proposal and choosing to provide additional funds to cover the entire 1-year tenure.
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.
We’re voting FOR the proposal and choosing to provide additional funds to cover the entire 1-year tenure.
Having spent a lot of time and effort to set up STEP, and having gone through the process of electing a program manager to oversee the program for a year, it doesn’t make sense to jeopardize all that progress for a shorter term of a new election.
The yield from the RWAs was supposed to be used for the DAO treasury anyway, but it hasn’t already been allocated to any initiative. With that in mind, it makes sense to cover the funding difference from the yield instead of having the DAO provide additional funds.
I vote for providing additional funding to cover the entire one year tenure as it would clearly be best to avoid changing to a new program manager.
Volatility is the norm tho in this space... so i'm sort of surprised that the treasury management group got caught by this, pretty ironic :upside_down_face:
Here is my ranking:
Thank you for doing this at Tally @Frisson and eating up the cost for ARB price volatility. It's the right move! :clap:
I voted following this reasoning, so my first choice was additional funds for 1 year.
I think it was our collective mistake initially to make a vote on the manager without referring to the existing funding that we all voted for in Tally.
The second issue that needs to be addressed and that has a lot to do with funding is when to swap ARB for USD. In the case of this vote in Tally, which took place on April 10, the ARB was priced at $1.48, so $100,000 becomes $148,000. Who decides when to swap? Who is responsible for the fact that the program lost more than $50k on the token rate?
Ultimately, it would be fair to hold new manager elections to equalize the chances of everyone who wants to be there.
Voted #1 Additional funds for one year (then other options): When we were voting on the original proposal, I was in favor. While I think this was an operational mistake by the team, we should avoid this mistake in the future. I still believe the STEP program works very well, and the team behind it should be compensated fairly. The solution to add funds for one year sounds like the best way to fix this. However, we should use this example to learn from and avoid repeating this mistake in the future.
I voted in the attached order on the temp check proposal.
The STEP program is one of the most successful DAO initiatives to date. We should keep this simple and pass a proposal to backfill the funding for the remainder of Stakehouse’s contract. Hopefully this is a learning experience for all involved to build more buffer into operational expenses, and to liquidate the ARB quickly if expenses are denominated in USD.
I voted in the attached order on the temp check proposal.
The STEP program is one of the most successful DAO initiatives to date. We should keep this simple and pass a proposal to backfill the funding for the remainder of Stakehouse’s contract. Hopefully this is a learning experience for all involved to build more buffer into operational expenses, and to liquidate the ARB quickly if expenses are denominated in USD.
In the future, we as a DAO need to consider a solution for shortfalls such as these due to ARB volatility. It’s an issue we’ve run into multiple times at Tally. We’ve simply eaten the cost difference in the past, but this is not something we are likely going to be able to do on an ongoing basis.
I voted to earmark additional funds. After all the effort that was made, it would be a pity to abandon it due to the lack of funds. I think that this program is really essential.
I voted New election at $86,581 per year, Liquidation of RWAs and STEP, 6 months from available funds, Additional funds for one year , Abstain because this feels like extortion. we should procure new service providers for this.
I voted as follows:
I vote for "Additional funds for one year" because I believe the DAO should cover this cost. The proposer didn't account for the ARB price changes, especially when paying Steakhouse, who quoted in stablecoin and the DAO accepted.
While it's unfortunate that the ARB price dropped, it’s not Steakhouse's fault, and they shouldn’t have to absorb this loss. I also agree with @duokongcrypto that using ARB instead of stablecoin might help avoid such issues in the future, as long as we handle price changes carefully.
Btw, I’m so interested in discussing how we manage these kinds of issues as the DAO grows. Balancing our budget and dealing with external services effectively will be important as we move forward
We're voting FOR additional funds for one year. Here's our ranking of the options, from most to least preferred:
This ranking prioritizes program continuity and respects the election results while balancing fiscal responsibility. The top two choices maintain Steakhouse Financial's involvement, differing only in duration. A new election is less desirable but preferable to program termination. Abstaining fails to address the issue, while liquidation is the least favorable, potentially wasting resources and community efforts.
Here are the reasons to Support Option 2 (Allocating Additional Funds to Complete the Program Manager’s One-Year Term):
Here are the reasons to Support Option 2 (Allocating Additional Funds to Complete the Program Manager’s One-Year Term):
The following reflects the views of the Lampros Labs DAO governance team, composed of @Blueweb, @Euphoria, and Hirangi Pandya (@Nyx), based on our combined research, analysis, and ideation.
We are voting FOR the proposal and support providing additional funds to cover the entire 1-year tenure.
The following reflects the views of the Lampros Labs DAO governance team, composed of @Blueweb, @Euphoria, and Hirangi Pandya (@Nyx), based on our combined research, analysis, and ideation.
We are voting FOR the proposal and support providing additional funds to cover the entire 1-year tenure.
After investing significant time and effort into setting up the STEP program and electing a program manager for a year, it would be a mistake to risk losing that progress for the sake of a shorter-term contract. Although we recognize this situation arose due to an operational mistake, steps should be taken to avoid such errors in the future.
We have voted in the following order.
Yes, we at Arbitrum Dao should make a change to pass on the value and it is essential that more people want to hold an ARB as well as gain confidence. Something like ARB is money, not ARB is an iceberg (melting)
Voting to keep the project running because I think it is too valuable to let die, however I'll echo others that this is becoming a recurring problem where projects are wanting to pay amounts in a USD price but keeping the value in ARB tokens.
This is a difficult one. I voted for additional funds for a year. It’s been a tremendous effort to run this project for the DAO, and it aligns with our long-term goals.
However, does this set a precedent for project managers or service providers to convert their funds to USD after passing a proposal?
We understand these are challenging times for the market, but… can we learn from this?
This is a difficult one. I voted for additional funds for a year. It’s been a tremendous effort to run this project for the DAO, and it aligns with our long-term goals.
However, does this set a precedent for project managers or service providers to convert their funds to USD after passing a proposal?
We understand these are challenging times for the market, but… can we learn from this?
Thinking about the sustainability of the token on one side and the service providers over time—these are interesting conversations I’d love to understand and explore.
After consideration, the @SEEDgov delegation has decided to vote “Additional funds for one year” on this proposal at the Snapshot vote.
After consideration, the @SEEDgov delegation has decided to vote “Additional funds for one year” on this proposal at the Snapshot vote.
We recognise the tremendous effort it has taken to manage this proposal and that is why we see no point in going any other way than to honour the agreement and pay Steakhouse for the whole year. It would even be a dangerous precedent to take any other decision, as we would be sending the message to service providers that the volatility of ARB and the difficulties in converting it to stables that we face could somehow alter the agreement reached with the DAO.
For all these reasons, it is reasonable to use part of the yield obtained to cover the corresponding annual payment.
We vote for additional funds for one year as the first choice on Snapshot.
While the DAO needs to address the issue around the conversation between the fiat and ARB token, we agree that the initial promise and contract with service providers should be respected and followed through with funds compensated by the treasury. Now, it's more critical to execute the program than delaying the operations.
Blockworks Research is in favor of providing additional funds to cover the full year of tenure for the STEP program manager. Treasury diversification and management is no joke, and we think that it would be best to provide the best incentives so that this is executed properly.
We stress though that this is becoming a recurrent problem for the DAO, and a greater payment plan needs to be structured. Multiple initiatives have fallen to the wayside because of ARB<>USD conversion problems.
We are in favor of allocating additional funds to cover the full one-year tenure for the STEP Program Manager. This decision is critical for ensuring continuity, stability, and avoiding operational disruptions to a program that has already proven to be a successful DAO initiative.
We are in favor of allocating additional funds to cover the full one-year tenure for the STEP Program Manager. This decision is critical for ensuring continuity, stability, and avoiding operational disruptions to a program that has already proven to be a successful DAO initiative.
We support moving forward without delay, collecting yield ASAP and ensuring that the program runs smoothly for the entire year, while learning from these challenges to improve proposal execution in the future.
We support allocating the additional funds to extend contract for the full one-year term, recognizing the significant effort invested in setting up the STEP program. A six-month term risks disrupting the program’s momentum and creating operational inefficiencies, whereas securing their management for the entire year ensures continuity and stability.
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.
We’re voting FOR the proposal and choosing to provide additional funds to cover the entire 1-year tenure.
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.
We’re voting FOR the proposal and choosing to provide additional funds to cover the entire 1-year tenure.
Having spent a lot of time and effort to set up STEP, and having gone through the process of electing a program manager to oversee the program for a year, it doesn’t make sense to jeopardize all that progress for a shorter term of a new election.
The yield from the RWAs was supposed to be used for the DAO treasury anyway, but it hasn’t already been allocated to any initiative. With that in mind, it makes sense to cover the funding difference from the yield instead of having the DAO provide additional funds.
I vote for providing additional funding to cover the entire one year tenure as it would clearly be best to avoid changing to a new program manager.
Volatility is the norm tho in this space... so i'm sort of surprised that the treasury management group got caught by this, pretty ironic :upside_down_face:
Here is my ranking:
Thank you for doing this at Tally @Frisson and eating up the cost for ARB price volatility. It's the right move! :clap:
I voted following this reasoning, so my first choice was additional funds for 1 year.
I think it was our collective mistake initially to make a vote on the manager without referring to the existing funding that we all voted for in Tally.
The second issue that needs to be addressed and that has a lot to do with funding is when to swap ARB for USD. In the case of this vote in Tally, which took place on April 10, the ARB was priced at $1.48, so $100,000 becomes $148,000. Who decides when to swap? Who is responsible for the fact that the program lost more than $50k on the token rate?
Ultimately, it would be fair to hold new manager elections to equalize the chances of everyone who wants to be there.
Voted #1 Additional funds for one year (then other options): When we were voting on the original proposal, I was in favor. While I think this was an operational mistake by the team, we should avoid this mistake in the future. I still believe the STEP program works very well, and the team behind it should be compensated fairly. The solution to add funds for one year sounds like the best way to fix this. However, we should use this example to learn from and avoid repeating this mistake in the future.
I voted in the attached order on the temp check proposal.
The STEP program is one of the most successful DAO initiatives to date. We should keep this simple and pass a proposal to backfill the funding for the remainder of Stakehouse’s contract. Hopefully this is a learning experience for all involved to build more buffer into operational expenses, and to liquidate the ARB quickly if expenses are denominated in USD.
I voted in the attached order on the temp check proposal.
The STEP program is one of the most successful DAO initiatives to date. We should keep this simple and pass a proposal to backfill the funding for the remainder of Stakehouse’s contract. Hopefully this is a learning experience for all involved to build more buffer into operational expenses, and to liquidate the ARB quickly if expenses are denominated in USD.
In the future, we as a DAO need to consider a solution for shortfalls such as these due to ARB volatility. It’s an issue we’ve run into multiple times at Tally. We’ve simply eaten the cost difference in the past, but this is not something we are likely going to be able to do on an ongoing basis.
I voted to earmark additional funds. After all the effort that was made, it would be a pity to abandon it due to the lack of funds. I think that this program is really essential.
I voted New election at $86,581 per year, Liquidation of RWAs and STEP, 6 months from available funds, Additional funds for one year , Abstain because this feels like extortion. we should procure new service providers for this.
I voted as follows:
I voted as follows:
The yield earned from the RWA portfolio is enough to cover the shortfall, so this seems like the best solution to me. However, I share the concerns raised by others that there should have been a hedge in place to avoid this issue, and/or that the currency denomination should have been clearer from the start. But as we say in my country, 'el hubiera no existe.'
Exactly, I was a bit confused when voting on Snapshot too. Listing the bullet points might give us a clearer idea of how to vote, especially since there are new users in the forum each time. That said, I think I would vote in the following order:
Let’s find the money to keep the program running please.
Thanks jojo appreciate the strong message of support!
Thanks jojo appreciate the strong message of support!
PS please, for the future, write the options in the snapshot in a better way.
Listing the bullet points might give us a clearer idea of how to vote, especially since there are new users in the forum each time
Yeah the 32 character limit definitely tripped me up, since i didn't know it was there and at 3 am i had to come up with new options on the spot while @krst was on the call. i like the idea of having option a, b , c ,d and a clear explanation of each in the main body of the proposal.
I wonder why no one has proposed to lower the budget by saying that the budget exceeded $174,000 when the ARB went up to $2.4
The issue here isn't with the service provider, who provided a fixed quote of $174,000. The issue was on my side in budgeting the amount to the program manager in ARB (although on tally i had mentioned these were estimates only)
in my opinion, approving the steakhouse budget on snapshot and then going back on it is unnecessary. i also think we should be aim to start the program as soon as possible, since every day delay is costing us thousands of dollars in yield
if i could go back in time, i would have written something along the lines of paying the implementation costs of running STEP and the remainder going as investment to the selected service provider.
Because of the funding, which led to this situation, why wasn’t it made clear beforehand that the solution should have been ARB denominated.
I might be in the minority here, but i don't think we should expect service providers to quote in ARB. Their costs are in USD, so what would end up happening is we pay a premium to every service provider who bakes in some volatility when charging in ARB. Can't yet pay rent in ARB unfortunately :smiling_face_with_tear:
Much more in favor of developing a cash management policy where we keep a reserve of stables in which to pay professionals.
Because of the funding, which led to this situation, why wasn't it made clear beforehand that the solution should have been ARB denominated. Or a more complete and standardised schedule in future, not supporting supplementary budgets because the form of anyone who gets arb will sell is not promising
This is an interesting proposal, I wonder why no one has proposed to lower the budget by saying that the budget exceeded $174,000 when the ARB went up to $2.4? When the proposals in the Arbitrum DAO involves ARB, why not use ARB as the standard currency? If ARB prices fluctuate and proposals have to be remade, wouldn't the Arbitrum DAO be a lot of duplication? Based on this consideration, I do not support a new supplementary budget or even reelection.
With everything set up for the program to run for a year, it is a shame to not doing it for a lack of funds for the PM.
If we want to proceed with funding in ARB, we must ensure that all SP make their proposals and are willing to accept to receive ARB.
If not, let's make everything crystal clear since the beginning.
With everything set up for the program to run for a year, it is a shame to not doing it for a lack of funds for the PM.
If we want to proceed with funding in ARB, we must ensure that all SP make their proposals and are willing to accept to receive ARB.
If not, let's make everything crystal clear since the beginning.
The solution provided (pay SH with 100k ARB and later with the proceeds of the program) is a reasonable one.
exploiting for shortening reasons the response from Pennsylvania University cause i voted in the same order (earmark funds, new elections, only 6 months, liquidation of the program, abstain)
Goal is to find the funds to pay Steakhouse for a whole year, to me anything else is unacceptable knowing the effort that was done to create this program growth oriented. Let's find the money to keep the program running please.
exploiting for shortening reasons the response from Pennsylvania University cause i voted in the same order (earmark funds, new elections, only 6 months, liquidation of the program, abstain)
Goal is to find the funds to pay Steakhouse for a whole year, to me anything else is unacceptable knowing the effort that was done to create this program growth oriented. Let's find the money to keep the program running please.
PS please, for the future, write the options in the snapshot in a better way. I understand that there are characters limitations, but a simple option a / b / c etcetera with an explanation of each option in the test would make everything clearer. Took me a few minutes to understand how to properly vote in the way I wanted.
The FranklinDAO / Penn Blockchain Team voted with the below ranking
The FranklinDAO / Penn Blockchain Team voted with the below ranking
We believe having a shortened 6 month program with another re-election would add unneeded bureaucracy and potentially less continuity if another service provider were elected.
Thank you for sharing! I agree that an election in 6 months is not ideal, and that we lose money in yield for every day delayed.
We should also remember that such programs usually pay a treasury manager 1% to manage, which we are able to avoid by doing it ourselves and getting a program manager.
I have been thinking about why arb dao can’t be strong enough to use arb as settlement, if everyone is considering converting arb to stablecoin in the short term, it invariably adds huge selling pressure to the market
I have been thinking about why arb dao can’t be strong enough to use arb as settlement, if everyone is considering converting arb to stablecoin in the short term, it invariably adds huge selling pressure to the market
I have heard a funny metaphor from @GFXlabs of the ARB token being a "melting ice cube". This is outside the topic but the larger goal is creating sinks to absorb ARB, which we dont have.
If steakhouse had quoted their fees in ARB and then thrown a fuss at price dropping, would have completely agreed with you.
but they submitted their quote in dollars from the beginning. It was my error in budgeting in ARB for the program manager role but receiving quotes in dollars from all the applicants
budget and conversion risk: in the future, is it considered to convert ARB to stablecoin in advance to avoid budget shortfalls?
Having the ability to draw stables directly through a tally proposal would be a huge benefit, something @Entropy is now working to facilitate. Most professionals in the space would charge in dollars, not ARB, so at least both options should be available
We voted to earmark additional funds from Yield earned so they can complete the one year tenure
Opportunity cost of time and capital:
We voted to earmark additional funds from Yield earned so they can complete the one year tenure
Opportunity cost of time and capital:
Quality
In conclusion, we think Arbitrum should continue with steakhouse and pay the shortfall with interest earned.
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received.
Although thats not possible to do unless they also provided a quotation in ARB :face_with_diagonal_mouth:
Looking at it I think the proposal discussion focuses on 2 issues, suggestions and questions as a delegate:
Looking at it I think the proposal discussion focuses on 2 issues, suggestions and questions as a delegate:
I have been thinking about why arb dao can't be strong enough to use arb as settlement, if everyone is considering converting arb to stablecoin in the short term, it invariably adds huge selling pressure to the market.Also these people don't work when they have less money? Can't maintain normal operations anymore? You could run for office in the open and I'm sure a bunch of people would show up.
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received. Alternatively, selling immediately is also a viable option, especially since the amount isn't large enough to necessitate using the DCA method for liquidation. We support the first two options because mistakes can occur. However, Steakhouse should implement measures to avoid these issues in the future, especially if their expenses are calculated in USD:
Thanks for the comments! The moment interest earned starts trickling in, we would meet the remaining 6 months pay if that option gets approved on snapshot
At the same time if it was ARB that was requested then it should be ARB that is paid. Because if the market went the other way then it would have been a bonus in pay.
My question is: why was there this huge delay in converting the arb in usd?
Before jumping on the topic, quick question.
At the time of tally (20th of march) the 100k arb were worth around $180k usd. At the end of tally (10th of april) the 100k arb were worth around $140k.
To have this, converted, worth $86k, we need to have had a conversion that happen not before the 17th of june I believe.
Before jumping on the topic, quick question.
At the time of tally (20th of march) the 100k arb were worth around $180k usd. At the end of tally (10th of april) the 100k arb were worth around $140k.
To have this, converted, worth $86k, we need to have had a conversion that happen not before the 17th of june I believe.
The step program manager application thread was posted the 23rd of april; it doesn't specify that costs of applicants should have been posted in arb, but i also understand that would have just not been the right move for request to external financial professionals to quote their service in a crypto currency not pegged, or anything that was not usd. Matter of the fact the example you provided was in usd.
The first application came in the 21st of may, and already quoted prices in usd.
My question is: why was there this huge delay in converting the arb in usd?
Also, this is something that we need to address as a dao and is not specific to only this program: if an entity is requesting arb to pay another entity in a non arb denominated way (usually usd), the funds MUST be converted right after being received in a tally vote, obviously compatible with the tools used (ie: aera). We can't just keep going in circle on this.
I voted as follows:
The yield earned from the RWA portfolio is enough to cover the shortfall, so this seems like the best solution to me. However, I share the concerns raised by others that there should have been a hedge in place to avoid this issue, and/or that the currency denomination should have been clearer from the start. But as we say in my country, 'el hubiera no existe.'
Exactly, I was a bit confused when voting on Snapshot too. Listing the bullet points might give us a clearer idea of how to vote, especially since there are new users in the forum each time. That said, I think I would vote in the following order:
Let’s find the money to keep the program running please.
Thanks jojo appreciate the strong message of support!
Thanks jojo appreciate the strong message of support!
PS please, for the future, write the options in the snapshot in a better way.
Listing the bullet points might give us a clearer idea of how to vote, especially since there are new users in the forum each time
Yeah the 32 character limit definitely tripped me up, since i didn't know it was there and at 3 am i had to come up with new options on the spot while @krst was on the call. i like the idea of having option a, b , c ,d and a clear explanation of each in the main body of the proposal.
I wonder why no one has proposed to lower the budget by saying that the budget exceeded $174,000 when the ARB went up to $2.4
The issue here isn't with the service provider, who provided a fixed quote of $174,000. The issue was on my side in budgeting the amount to the program manager in ARB (although on tally i had mentioned these were estimates only)
in my opinion, approving the steakhouse budget on snapshot and then going back on it is unnecessary. i also think we should be aim to start the program as soon as possible, since every day delay is costing us thousands of dollars in yield
if i could go back in time, i would have written something along the lines of paying the implementation costs of running STEP and the remainder going as investment to the selected service provider.
Because of the funding, which led to this situation, why wasn’t it made clear beforehand that the solution should have been ARB denominated.
I might be in the minority here, but i don't think we should expect service providers to quote in ARB. Their costs are in USD, so what would end up happening is we pay a premium to every service provider who bakes in some volatility when charging in ARB. Can't yet pay rent in ARB unfortunately :smiling_face_with_tear:
Much more in favor of developing a cash management policy where we keep a reserve of stables in which to pay professionals.
Because of the funding, which led to this situation, why wasn't it made clear beforehand that the solution should have been ARB denominated. Or a more complete and standardised schedule in future, not supporting supplementary budgets because the form of anyone who gets arb will sell is not promising
This is an interesting proposal, I wonder why no one has proposed to lower the budget by saying that the budget exceeded $174,000 when the ARB went up to $2.4? When the proposals in the Arbitrum DAO involves ARB, why not use ARB as the standard currency? If ARB prices fluctuate and proposals have to be remade, wouldn't the Arbitrum DAO be a lot of duplication? Based on this consideration, I do not support a new supplementary budget or even reelection.
With everything set up for the program to run for a year, it is a shame to not doing it for a lack of funds for the PM.
If we want to proceed with funding in ARB, we must ensure that all SP make their proposals and are willing to accept to receive ARB.
If not, let's make everything crystal clear since the beginning.
With everything set up for the program to run for a year, it is a shame to not doing it for a lack of funds for the PM.
If we want to proceed with funding in ARB, we must ensure that all SP make their proposals and are willing to accept to receive ARB.
If not, let's make everything crystal clear since the beginning.
The solution provided (pay SH with 100k ARB and later with the proceeds of the program) is a reasonable one.
exploiting for shortening reasons the response from Pennsylvania University cause i voted in the same order (earmark funds, new elections, only 6 months, liquidation of the program, abstain)
Goal is to find the funds to pay Steakhouse for a whole year, to me anything else is unacceptable knowing the effort that was done to create this program growth oriented. Let's find the money to keep the program running please.
exploiting for shortening reasons the response from Pennsylvania University cause i voted in the same order (earmark funds, new elections, only 6 months, liquidation of the program, abstain)
Goal is to find the funds to pay Steakhouse for a whole year, to me anything else is unacceptable knowing the effort that was done to create this program growth oriented. Let's find the money to keep the program running please.
PS please, for the future, write the options in the snapshot in a better way. I understand that there are characters limitations, but a simple option a / b / c etcetera with an explanation of each option in the test would make everything clearer. Took me a few minutes to understand how to properly vote in the way I wanted.
The FranklinDAO / Penn Blockchain Team voted with the below ranking
The FranklinDAO / Penn Blockchain Team voted with the below ranking
We believe having a shortened 6 month program with another re-election would add unneeded bureaucracy and potentially less continuity if another service provider were elected.
Thank you for sharing! I agree that an election in 6 months is not ideal, and that we lose money in yield for every day delayed.
We should also remember that such programs usually pay a treasury manager 1% to manage, which we are able to avoid by doing it ourselves and getting a program manager.
I have been thinking about why arb dao can’t be strong enough to use arb as settlement, if everyone is considering converting arb to stablecoin in the short term, it invariably adds huge selling pressure to the market
I have been thinking about why arb dao can’t be strong enough to use arb as settlement, if everyone is considering converting arb to stablecoin in the short term, it invariably adds huge selling pressure to the market
I have heard a funny metaphor from @GFXlabs of the ARB token being a "melting ice cube". This is outside the topic but the larger goal is creating sinks to absorb ARB, which we dont have.
If steakhouse had quoted their fees in ARB and then thrown a fuss at price dropping, would have completely agreed with you.
but they submitted their quote in dollars from the beginning. It was my error in budgeting in ARB for the program manager role but receiving quotes in dollars from all the applicants
budget and conversion risk: in the future, is it considered to convert ARB to stablecoin in advance to avoid budget shortfalls?
Having the ability to draw stables directly through a tally proposal would be a huge benefit, something @Entropy is now working to facilitate. Most professionals in the space would charge in dollars, not ARB, so at least both options should be available
We voted to earmark additional funds from Yield earned so they can complete the one year tenure
Opportunity cost of time and capital:
We voted to earmark additional funds from Yield earned so they can complete the one year tenure
Opportunity cost of time and capital:
Quality
In conclusion, we think Arbitrum should continue with steakhouse and pay the shortfall with interest earned.
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received.
Although thats not possible to do unless they also provided a quotation in ARB :face_with_diagonal_mouth:
Looking at it I think the proposal discussion focuses on 2 issues, suggestions and questions as a delegate:
Looking at it I think the proposal discussion focuses on 2 issues, suggestions and questions as a delegate:
I have been thinking about why arb dao can't be strong enough to use arb as settlement, if everyone is considering converting arb to stablecoin in the short term, it invariably adds huge selling pressure to the market.Also these people don't work when they have less money? Can't maintain normal operations anymore? You could run for office in the open and I'm sure a bunch of people would show up.
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received. Alternatively, selling immediately is also a viable option, especially since the amount isn't large enough to necessitate using the DCA method for liquidation. We support the first two options because mistakes can occur. However, Steakhouse should implement measures to avoid these issues in the future, especially if their expenses are calculated in USD:
Thanks for the comments! The moment interest earned starts trickling in, we would meet the remaining 6 months pay if that option gets approved on snapshot
At the same time if it was ARB that was requested then it should be ARB that is paid. Because if the market went the other way then it would have been a bonus in pay.
My question is: why was there this huge delay in converting the arb in usd?
Before jumping on the topic, quick question.
At the time of tally (20th of march) the 100k arb were worth around $180k usd. At the end of tally (10th of april) the 100k arb were worth around $140k.
To have this, converted, worth $86k, we need to have had a conversion that happen not before the 17th of june I believe.
Before jumping on the topic, quick question.
At the time of tally (20th of march) the 100k arb were worth around $180k usd. At the end of tally (10th of april) the 100k arb were worth around $140k.
To have this, converted, worth $86k, we need to have had a conversion that happen not before the 17th of june I believe.
The step program manager application thread was posted the 23rd of april; it doesn't specify that costs of applicants should have been posted in arb, but i also understand that would have just not been the right move for request to external financial professionals to quote their service in a crypto currency not pegged, or anything that was not usd. Matter of the fact the example you provided was in usd.
The first application came in the 21st of may, and already quoted prices in usd.
My question is: why was there this huge delay in converting the arb in usd?
Also, this is something that we need to address as a dao and is not specific to only this program: if an entity is requesting arb to pay another entity in a non arb denominated way (usually usd), the funds MUST be converted right after being received in a tally vote, obviously compatible with the tools used (ie: aera). We can't just keep going in circle on this.
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received.
This wouldn't entirely solve the issue, since we passed the tally proposal earmarking funds for a program manager before even holding the election for who it would be and knowing their rate. The tally was based on estimates only and the prevailing ARB price, actuals were only received in the snapshot 2 months after the tally passed.
We’re curious to know if they would have returned a portion of the funds if the token’s price had increased in value.
Steakhouse submitted a quote in dollars only. The plan was for the Arbitrum Foundation to pay the fees of the program manager (in dollars) and return funds from the implementation budget to the DAO
So if the price had increased, i am sure the AF would have returned the funds. you do raise a good point on converting the implementation budget immediately and not lumping it in with the DCA of the entire 35 million ARB for the STEP program.
Although thats not possible to do unless they also provided a quotation in ARB :face_with_diagonal_mouth:
we can't pretend that an external bank / fund / entity quotes us a price in arb. The only viable alternative is request a certain amount of arb in tally, with a buffer, and convert that opex amount right away in usd, so that RFQ can be done and we can know with facts if we can answer yes or no to a certain party.
Now, let's go back to the main point.
Knowing that the STEP program had, as one of the main goal, growth of RWA assets in Arbitrum, I think it would be important for the DAO to provide the funds we are currently lacking; without doing so, we will be the DAO that wants financial professionals to work in crypto, but lacks basic accounting abilities to cover for expenses.
This also mean that, to me, this is most a one time thing more than a rule: I don't see a future in which we will replicate this, unless there are strong motivations to do.
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received. Alternatively, selling immediately is also a viable option, especially since the amount isn't large enough to necessitate using the DCA method for liquidation. We support the first two options because mistakes can occur. However, Steakhouse should implement measures to avoid these issues in the future, especially if their expenses are calculated in USD:
We're curious to know if they would have returned a portion of the funds if the token's price had increased in value.
Thanks for the comments! The moment interest earned starts trickling in, we would meet the remaining 6 months pay if that option gets approved on snapshot
At the same time if it was ARB that was requested then it should be ARB that is paid. Because if the market went the other way then it would have been a bonus in pay.
Steakhouse financial (the selected program manager) never quoted their fees in ARB. From the beginning, they priced their services at $174,000 so even if ARB price went up they would still have received the same amount.
When budgeting for the main tally proposal, it was my error to estimate prices in ARB but receive quotations for the role in USD. Hopefully we can remedy this situation by having more stables in our treasury in the future to draw from, it is not professional to expect service providers to quote fees in ARB.
My question is: why was there this huge delay in converting the arb in usd?
The foundation dollar cost averaged the ARB over a 7 week period to minimize any price shocks to the market. I am not sure when the first liquidation was though, I believe it was in either May or June.
this is something that we need to address as a dao and is not specific to only this program: if an entity is requesting arb to pay another entity in a non arb denominated way (usually usd), the funds MUST be converted right after being received in a tally vote, obviously compatible with the tools used (ie: aera)
completely aligned here, it is ironic that despite predicting fairly accurately what costs would be incurred in a program manager through the sample quotation, we still landed up in this fracas.
There is some discussion kickstarted by @Avantgarde to remedy this state of affairs by having short term cash reserves in USDC. The yield from the current STEP proposal is also in the same alley, providing between $1 and $1.5 million per year in USDC to our treasury.
i also understand that would have just not been the right move for request to external financial professionals to quote their service in a crypto currency not pegged, or anything that was not usd. Matter of the fact the example you provided was in usd.
The nub of the matter according to those i spoke with at the foundation (who requested this proposal and vote) was that program managers should not have provided quotations higher than the sanctioned amount on tally in the first place.
Although thats not possible to do unless they also provided a quotation in ARB :face_with_diagonal_mouth:
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received.
This wouldn't entirely solve the issue, since we passed the tally proposal earmarking funds for a program manager before even holding the election for who it would be and knowing their rate. The tally was based on estimates only and the prevailing ARB price, actuals were only received in the snapshot 2 months after the tally passed.
We’re curious to know if they would have returned a portion of the funds if the token’s price had increased in value.
Steakhouse submitted a quote in dollars only. The plan was for the Arbitrum Foundation to pay the fees of the program manager (in dollars) and return funds from the implementation budget to the DAO
So if the price had increased, i am sure the AF would have returned the funds. you do raise a good point on converting the implementation budget immediately and not lumping it in with the DCA of the entire 35 million ARB for the STEP program.
Although thats not possible to do unless they also provided a quotation in ARB :face_with_diagonal_mouth:
we can't pretend that an external bank / fund / entity quotes us a price in arb. The only viable alternative is request a certain amount of arb in tally, with a buffer, and convert that opex amount right away in usd, so that RFQ can be done and we can know with facts if we can answer yes or no to a certain party.
Now, let's go back to the main point.
Knowing that the STEP program had, as one of the main goal, growth of RWA assets in Arbitrum, I think it would be important for the DAO to provide the funds we are currently lacking; without doing so, we will be the DAO that wants financial professionals to work in crypto, but lacks basic accounting abilities to cover for expenses.
This also mean that, to me, this is most a one time thing more than a rule: I don't see a future in which we will replicate this, unless there are strong motivations to do.
It would have been prudent to protect against a potential drop in revenue by hedging. This could be accomplished by shorting an equivalent amount of ARB, effectively locking in the dollar value to be received. Alternatively, selling immediately is also a viable option, especially since the amount isn't large enough to necessitate using the DCA method for liquidation. We support the first two options because mistakes can occur. However, Steakhouse should implement measures to avoid these issues in the future, especially if their expenses are calculated in USD:
We're curious to know if they would have returned a portion of the funds if the token's price had increased in value.
Thanks for the comments! The moment interest earned starts trickling in, we would meet the remaining 6 months pay if that option gets approved on snapshot
At the same time if it was ARB that was requested then it should be ARB that is paid. Because if the market went the other way then it would have been a bonus in pay.
Steakhouse financial (the selected program manager) never quoted their fees in ARB. From the beginning, they priced their services at $174,000 so even if ARB price went up they would still have received the same amount.
When budgeting for the main tally proposal, it was my error to estimate prices in ARB but receive quotations for the role in USD. Hopefully we can remedy this situation by having more stables in our treasury in the future to draw from, it is not professional to expect service providers to quote fees in ARB.
My question is: why was there this huge delay in converting the arb in usd?
The foundation dollar cost averaged the ARB over a 7 week period to minimize any price shocks to the market. I am not sure when the first liquidation was though, I believe it was in either May or June.
this is something that we need to address as a dao and is not specific to only this program: if an entity is requesting arb to pay another entity in a non arb denominated way (usually usd), the funds MUST be converted right after being received in a tally vote, obviously compatible with the tools used (ie: aera)
completely aligned here, it is ironic that despite predicting fairly accurately what costs would be incurred in a program manager through the sample quotation, we still landed up in this fracas.
There is some discussion kickstarted by @Avantgarde to remedy this state of affairs by having short term cash reserves in USDC. The yield from the current STEP proposal is also in the same alley, providing between $1 and $1.5 million per year in USDC to our treasury.
i also understand that would have just not been the right move for request to external financial professionals to quote their service in a crypto currency not pegged, or anything that was not usd. Matter of the fact the example you provided was in usd.
The nub of the matter according to those i spoke with at the foundation (who requested this proposal and vote) was that program managers should not have provided quotations higher than the sanctioned amount on tally in the first place.
Although thats not possible to do unless they also provided a quotation in ARB :face_with_diagonal_mouth:
