[Non-Constitutional] Arbitrum Token Swap Pilot Program

Phase	Deliverables	Staff	Time	Budget
Pre-Swap/ Application Period	RFP for interested projects to apply with details on number of ARB tokens the project would be interested in swapping, information about the project’s treasury and runway, information about the token utility and governance, and a plan for what it would do with the ARB received from the Token swap.	WG0 Members: Devansh Mehta and LuukDAO	3 weeks	21,000 ARB
Execution / Review Period	The Council will review each application based on quality and recommend which projects and what quantities to swap. These recommendations will be put to Snapshot for ratification by Arbitrum DAO	Voting Members: WG0 Lead LuukDAO,Castle Capital, GFX LabsFacilitating Member: Devansh Mehta	4 weeks	56,000 ARB
Post-Swap/Monitoring Period	Work with the Arbitrum Foundation for KYB of selected projects and with projects to ratify the deal with their team, community, and governance. Update and track deals in Dashboard after all execution is complete (those failing KYB or not getting approval will be removed from the list) through a Dune Dashboard to track its and third-party holdings of swapped tokens. Create a detailed Pilot Report with learnings to be published in week 6 of the monitoring phase. When token Swaps are larger than 400K ARB or otherwise deemed necessary, facilitate sourcing of delegates to represent Arbitrum’s interest in the counterparty DAO Facilitate WGs to decide on future of program and integration with other ecosystem support programs.	WG0 Lead: LuukDAO	16 weeks	53,000 ARB

Phase	Deliverables	Staff	Time	Budget
Pre-Swap/ Application Period	RFP for interested projects to apply with details on number of ARB tokens the project would be interested in swapping, information about the project’s treasury and runway, information about the token utility and governance, and a plan for what it would do with the ARB received from the Token swap.	WG0 Members: Devansh Mehta and LuukDAO	3 weeks	21,000 ARB
Execution / Review Period	The Council will review each application based on quality and recommend which projects and what quantities to swap. These recommendations will be put to Snapshot for ratification by Arbitrum DAO	Voting Members: WG0 Lead LuukDAO,Castle Capital, GFX LabsFacilitating Member: Devansh Mehta	4 weeks	56,000 ARB
Post-Swap/Monitoring Period	Work with the Arbitrum Foundation for KYB of selected projects and with projects to ratify the deal with their team, community, and governance. Update and track deals in Dashboard after all execution is complete (those failing KYB or not getting approval will be removed from the list) through a Dune Dashboard to track its and third-party holdings of swapped tokens. Create a detailed Pilot Report with learnings to be published in week 6 of the monitoring phase. When token Swaps are larger than 400K ARB or otherwise deemed necessary, facilitate sourcing of delegates to represent Arbitrum’s interest in the counterparty DAO Facilitate WGs to decide on future of program and integration with other ecosystem support programs.	WG0 Lead: LuukDAO	16 weeks	53,000 ARB

Phase	Deliverables	Staff	Time	Budget
Pre-Swap/ Application Period	RFP for interested projects to apply with details on number of ARB tokens the project would be interested in swapping, information about the project’s treasury and runway, information about the token utility and governance, and a plan for what it would do with the ARB received from the Token swap.	WG0 Members: Devansh Mehta and LuukDAO	3 weeks	21,000 ARB
Execution / Review Period	The Council will review each application based on quality and recommend which projects and what quantities to swap. These recommendations will be put to Snapshot for ratification by Arbitrum DAO	Voting Members: WG0 Lead LuukDAO,Castle Capital, GFX LabsFacilitating Member: Devansh Mehta	4 weeks	56,000 ARB
Post-Swap/Monitoring Period	Work with the Arbitrum Foundation for KYB of selected projects and with projects to ratify the deal with their team, community, and governance. Update and track deals in Dashboard after all execution is complete (those failing KYB or not getting approval will be removed from the list) through a Dune Dashboard to track its and third-party holdings of swapped tokens. Create a detailed Pilot Report with learnings to be published in week 6 of the monitoring phase. When token Swaps are larger than 400K ARB or otherwise deemed necessary, facilitate sourcing of delegates to represent Arbitrum’s interest in the counterparty DAO Facilitate WGs to decide on future of program and integration with other ecosystem support programs.	WG0 Lead: LuukDAO	16 weeks	53,000 ARB

Phase	Deliverables	Staff	Time	Budget
Pre-Swap/ Application Period	RFP for interested projects to apply with details on number of ARB tokens the project would be interested in swapping, information about the project’s treasury and runway, information about the token utility and governance, and a plan for what it would do with the ARB received from the Token swap.	WG0 Members: Devansh Mehta and LuukDAO	3 weeks	21,000 ARB
Execution / Review Period	The Council will review each application based on quality and recommend which projects and what quantities to swap. These recommendations will be put to Snapshot for ratification by Arbitrum DAO	Voting Members: WG0 Lead LuukDAO,Castle Capital, GFX LabsFacilitating Member: Devansh Mehta	4 weeks	56,000 ARB
Post-Swap/Monitoring Period	Work with the Arbitrum Foundation for KYB of selected projects and with projects to ratify the deal with their team, community, and governance. Update and track deals in Dashboard after all execution is complete (those failing KYB or not getting approval will be removed from the list) through a Dune Dashboard to track its and third-party holdings of swapped tokens. Create a detailed Pilot Report with learnings to be published in week 6 of the monitoring phase. When token Swaps are larger than 400K ARB or otherwise deemed necessary, facilitate sourcing of delegates to represent Arbitrum’s interest in the counterparty DAO Facilitate WGs to decide on future of program and integration with other ecosystem support programs.	WG0 Lead: LuukDAO	16 weeks	53,000 ARB

[Non-Constitutional] Arbitrum Token Swap Pilot Program | proposals.app

posted 2 years ago

edited 2 years ago

Greetings! I enjoyed reading your post, I share your gratitude towards this proposal; also, truly valid concern regarding the conflict-of-interest rules I must say; I also liked the reply that came with your inquiry, it gave me the insight I was looking for. I am highly interested in this topic and everything related to it, the way this proposal was presented was just mesmerizing! Very well structured and clear. Just by looking at the list with the 19 candidates or the so called “blue chips” I can calm my mind since this pilot prioritizes mature projects with significant past engagement with Arbitrum; It is clear that the eligible protocols were sorted by loyalty, in addition, each candidate must pass through the filter of being eligible by complying the requirements which adds safety to the process so we can be sure we will have the best of the best to deploy. I also like the parameters considered by the committee members in order to determine the exact swap size, I think they are being thoroughly and this pilot deserves it. It is important to remember that the swaps will be executed through Hedgey Finance (most used DAO token swap solution); If the parties involved do their part well there is no reason for corruption, and the process is so detailed and its phases transparent that any negative attempt or vested interests would be detected on the spot, of course there will always be risks but hoping for the best and planning for the bad never hurts right? I say this with all due respect, because I liked your post so much, it got me thinking a lot you know? We must not forget that despite the risk involved in a process, if the reward is bigger than the risk, then we must push forward!

The rationale makes it clear:

Bi-directional alignment with top ecosystem projects.
Ecosystem development and incentive programs like STIP and LTIPP.
Incentives for loyalty towards Arbitrum through a token swap program.

Also, regarding the following note:

-If insufficient projects are willing to participate in the exchange, we’ll explore alternative eligibility requirements and submit an additional Snapshot vote to ratify these changes. -

I just hope for the eligibility requirements to remain strict and selective in order to bring the best to the table in order to keep rewarding loyalty and promising projects.

Thanks for your input, have an excellent day! :star_struck: :pray: :+1:

Reymond

posted 2 years ago

edited 2 years ago

The rationale makes it clear:

Bi-directional alignment with top ecosystem projects.
Ecosystem development and incentive programs like STIP and LTIPP.
Incentives for loyalty towards Arbitrum through a token swap program.

Also, regarding the following note:

-If insufficient projects are willing to participate in the exchange, we’ll explore alternative eligibility requirements and submit an additional Snapshot vote to ratify these changes. -

I just hope for the eligibility requirements to remain strict and selective in order to bring the best to the table in order to keep rewarding loyalty and promising projects.

Thanks for your input, have an excellent day! :star_struck: :pray: :+1:

LevelK

posted 2 years ago

The LevelK Delegation is voting FOR this off chain proposal. We have read and reflected upon the critiques of this proposal. We acknowledge there are potential functional issues and would love to see some of the other delegates concerns addressed if this makes it to an onchain vote. We support this pilot proposal that functions as an experiment, but wanted to raise some questions and thoughts.

Here are some of our questions: Should this be a separate from the LTIPP and STIP? Or should it be integrated somehow? How do you measure success in this program? Longterm alignment with arbitrum? Is there an alternative way to structure the program that doesn’t include a committee? Could qualitative research be conducted with the protocols that could provide compelling support of this initiative? Do protocols want to be involved in Arbitrum Governance? (If they aren’t already)

Thoughts: Thinking about the difference between incentives (providing ARB to protocols with the agreement they will distribute them to users) and swaps (where each party swaps and holds their tokens). Would it be possible to integrate SWAPs into the incentives program?

On a spectrum: one end we could have just giving arb, on the other end have swaps with locks. While in the middle we could have a hybrid that allows a preferential swap (ex: 10 ARB to 1 BAL) where the protocol is expected to spend the received ARB as incentives. This way the DAO is still signaling their support by holding the protocol’s token and the protocol is provided with liquidity to use as incentives. It also benefits the DAO compared to just giving tokens as incentives because the DAO get’s something in return, even if it is a low market cap volatile token. This hybrid could allow for SWAPs to become an essential incentive mechanism while not cluttering the DAO with various ways for protocols to engage.

These are just the thoughts or our delegation. We are in support the idea of swapping, and would like to see further discussion around these ideas.

LevelK

posted 2 years ago

These are just the thoughts or our delegation. We are in support the idea of swapping, and would like to see further discussion around these ideas.

Vertex_Protocol

posted 2 years ago

We'd like to reiterate the feedback provided by @lindsey in the original thread about this proposal (emphasis ours).

This won’t be diversifying Arbitrum’s treasury into stable coins (a good diversification) but instead into other volatile assets that will be nearly impossible for the DAO to sell. Will there be an active manager with at-will ability to sell tokens? What negative sentiment would that bring on the DAO if it sold a protocols tokens? I think making super clear guidelines for what the DAO can do with tokens it receives and outlining the group that will be in charge of carrying out those actions would be important here. Otherwise it’s Arbitrum diversifying into an asset it wont be able to exit.

We'd like to reiterate the feedback provided by @lindsey in the original thread about this proposal (emphasis ours).

This won’t be diversifying Arbitrum’s treasury into stable coins (a good diversification) but instead into other volatile assets that will be nearly impossible for the DAO to sell. Will there be an active manager with at-will ability to sell tokens? What negative sentiment would that bring on the DAO if it sold a protocols tokens? I think making super clear guidelines for what the DAO can do with tokens it receives and outlining the group that will be in charge of carrying out those actions would be important here. Otherwise it’s Arbitrum diversifying into an asset it wont be able to exit.

the reply was that

Ideally, a Treasury Team would operate the Financial department of Arbitrum DAO and define strategies to utilize and devest from Protocol tokens.

Treasury management with ETH and ARB is still in its early stages, and expanding to additional tokens will require consideration of both quantitative risks and social impacts which we don't feel the DAO is prepared to handle currently. However, if the DAO's goal is not to sell tokens, a more nuanced strategy could involve token swaps for more productive assets, like yield-bearing or staked tokens, where revenue sharing is attached to them.

If the DAO commits to keeping them permanently staked (or otherwise used as part of the revenue sharing system) this would enhance long-term value compared to orienting more around short-term liquidity needs.

As a result, the DAO could dually benefit from the revenue streams of both the protocol growth from the productive assets and the money made via sequencer fees – eliminating the need to decide which protocols tokens to sell and when.

In the future, once the systems are established, the DAO could also swap staked ARB with protocols via agreements around the length of staking from their side. The potential result would be a symbiotic relationship where projects are less reliant on one-sided incentive programs since they have an extra stream of income they can use to grow. The revenue stream would progressively increase in parallel with the Arbitrum ecosystem’s growth – sequencer fee revenue. Specifics of this can be iterated on but we're curious to see if delegates have any feedback.

Vertex_Protocol

posted 2 years ago

We'd like to reiterate the feedback provided by @lindsey in the original thread about this proposal (emphasis ours).

This won’t be diversifying Arbitrum’s treasury into stable coins (a good diversification) but instead into other volatile assets that will be nearly impossible for the DAO to sell. Will there be an active manager with at-will ability to sell tokens? What negative sentiment would that bring on the DAO if it sold a protocols tokens? I think making super clear guidelines for what the DAO can do with tokens it receives and outlining the group that will be in charge of carrying out those actions would be important here. Otherwise it’s Arbitrum diversifying into an asset it wont be able to exit.

We'd like to reiterate the feedback provided by @lindsey in the original thread about this proposal (emphasis ours).

This won’t be diversifying Arbitrum’s treasury into stable coins (a good diversification) but instead into other volatile assets that will be nearly impossible for the DAO to sell. Will there be an active manager with at-will ability to sell tokens? What negative sentiment would that bring on the DAO if it sold a protocols tokens? I think making super clear guidelines for what the DAO can do with tokens it receives and outlining the group that will be in charge of carrying out those actions would be important here. Otherwise it’s Arbitrum diversifying into an asset it wont be able to exit.

the reply was that

Ideally, a Treasury Team would operate the Financial department of Arbitrum DAO and define strategies to utilize and devest from Protocol tokens.

AbdullahUmar from uniswap-dao.eth

1.3M TOKEN

posted 2 years ago

Below are the opinions of the UADP:

We voted For this proposal since 1) it’s a pilot program that will help iron out some of the specific operational aspects through trial 2) the practice of token swaps, done well, can be a means for effectively aligning protocols within an ecosystem, while simultaneously acting as a means of capital investment for the purpose of a direct monetary return.

Below are the opinions of the UADP:

Although the premise of alignment based on holding the native token of another protocol can be questioned, we believe that it has solid grounding. The lockup term here matters, of course. That’s why we would’ve liked to see a longer period where both parties are subject to a lockup, and once that cliff is reached, a gradual vesting process.

Each counterparty should also be treated differently. A token swap with GMX vs one with Thales would be very different, not only due to the relative size of each party but also based on their relative contributions to the Arbitrum ecosystem. In effect, the council is in place for the sake of underwriting, and even if this process could be relegated to the DAO, we believe that such processes are best conducted under the purview of a council. The future management of this capital is up for discussion, and in our opinion, is a point to discuss as soon as possible but need not be a blocker for this trial. It is a conversation that can occur while the due diligence for swaps occurs—more than likely we won’t be selling off our swapped treasury assets immediately due to contractual lockups.

There have also been concerns about swapping tokens with projects that lack potential upward trajectory. While this may be the case, token swaps are very much a combination of effective portfolio allocation and strategic alignment. Traditional companies, for instance, often take controlling interest in firms that they want to collaborate with, often to attain higher degrees of ownership across the value chain. In similar fashion, Arbitrum would be able to vote on the proposals of these protocols to ensure their alignment. The degree of governance that Arb DAO can partake in with these small DAOs is a fair concern.

To the portfolio allocation point, the amount of the swap would of course be lower for more risky partners. A protocol like GMX would likely warrant a larger swap due to their tried and tested nature—plus, the recent buyback+distribution program that they’ve been running only brings more value to GMX token holders. Alignment should also not be the primary impetus for token swaps, although not entirely disregarded, of course. This would mean analyzing projects that aren’t exactly Arbitrum native, which could also be a prudent practice from a pure investment return perspective. More blue chip assets from multi-chain protocols would benefit Arb’s treasury by ideally reducing its overall volatility, especially since smaller cap Arbitrum native tokens would only increase the Arb treasury’s beta to the $ARB token itself. Swaps with larger protocols can also help Arb attain a stake in the governance of notable DAOs.

AbdullahUmar from uniswap-dao.eth

1.3M TOKEN

posted 2 years ago

Below are the opinions of the UADP:

PGov from pgov.eth

301.00 TOKEN

posted 2 years ago

We appreciate the thoughtfulness behind the proposal and we're interested in the directional relationships with key projects while potentially offering the Arbitrum DAO new strategic advantages.

Some key areas for consideration, particularly regarding due diligence and the committee’s role:

We appreciate the thoughtfulness behind the proposal and we're interested in the directional relationships with key projects while potentially offering the Arbitrum DAO new strategic advantages.

Some key areas for consideration, particularly regarding due diligence and the committee’s role:

Importance of Due Diligence: Effective due diligence is essential in assessing the projects that are eligible for swaps. The criteria outlined, such as project treasury size, token utility, and past performance with grants, are crucial and initially, we're hesitant in doing too many swaps off the start.

Role of the Selected Committee: @LuukDAO, @GFXlabs, @CastleCapital, and @thedevanshmehta—bring a great chunk of experience to the table, which is crucial for the execution and success of the pilot. We've known some member for a while such as @GFXlabs and are sure they will do a great job in the evaluation but overall, would like to err on the cautious side and encourage not too many swaps of the get go.

Concerns on Timeline and Alignment: One potential area of concern is the lock-up period of one year followed by a ten-month vesting schedule. While it provides a degree of protection, it may not fully achieve long-term alignment between Arbitrum and the selected projects. Longer lock-ups or even renewal mechanisms, as suggested by other delegates, could enhance alignment and ensure that both parties remain committed over a more extended period.

Overall, the is a promising initiative, but success will largely hinge on the rigor of the due diligence process and the ability of the selected committee members, and we're in favor of something as intense as this be a selection process instead of a DAO vote.

JoJo from jojothecow.eth

2.6M TOKEN

posted 2 years ago

I'm voting AGAINST this proposal in the temp check.

First of all, motivation seems unclear.

Quoted from LuukDAO

By embedding Token Swaps as a vital element of Arbitrum Ecosystem Development and critical programs such as LTIP, Arbitrum can continue pro-actively incentivizing ecosystem growth

I'm voting AGAINST this proposal in the temp check.

First of all, motivation seems unclear.

Quoted from LuukDAO

By embedding Token Swaps as a vital element of Arbitrum Ecosystem Development and critical programs such as LTIP, Arbitrum can continue pro-actively incentivizing ecosystem growth

This is what is stated here. In the initial discussion, which I don't know why it wasn't linked, it was instead presented with a different motivation.

Quoted from thedevanshmehta

Token swaps are a form of treasury diversification that increases Arbitrum alignment of protocols. In our view, token swaps should be the final stage of ecosystem support by the DAO, which could begin with a small Questbook grant and finally graduate to a direct token swap with us.

The initiative has been moved from treasury diversification to growth of the chain, with a partial common goal of alignment of the protocols. But even here, the treasure example to me doesn't hold: we are giving for granted that, if our treasury would have held magic, treasure would have stayed in our ecosystem. I don't think this holds true. For these reasons, seems like the end goals are a bit unclear.

Also, and maybe is me, I think this program is more a "virtue signal" than anything. Let me try to analyse the reasons why a protocol should do a token swap, knowing that the following are the terms.

Quoted from LuukDAO

Non-Sales Clause Arbitrum DAO and the third-party DAO will swap tokens with a 3-month lock. After the three month lock, the tokens will unlock 10% monthly for ten months. If no Arbitrum Treasury Management team is in place within nine months of executing the token swaps, the Pilot team will propose a solution for managing these tokens before they unlock.

Using for OpEx / Incentive program The protocol will start to receive to get unlocked arb, at a rate of 10%, after 3 months. I see little reason for a protocol to get into this deal for covering opex since these are the terms; but neither the terms are such that the protocol can use the sum easily to spin up their own incentive program, at least not before several months (and they could do it through their own token at that point).

Using as yield generating mechanism We still don't have staked arb. We are currently working on it, but will take some time to be implemented; as such, is quite difficult to project the economics in an exchange. Matter of the fact, most token swaps are done because not only you signal alignment, but also because is bad optic for yourself to farm your own protocol with your own token but is instead ok to farm a friendly protocol. How can we even put the real value proposition of arb if we don't yet know how staking will look like?

Using for voting power This is the only case currently that would make sense to me: a protocol wants to participate to the governance of Arbitrum. But, looking at the list of the 19 protocols whitelisted, almost all the upperhalf of them is already participating to the governance; the lower half, will be quite difficult IMHO to involve them in governance unless there has been specific contacts on this regards. Happy to be proven wrong, would be good to have more builders involved in our DAO directly.

There is also a final consideration on the management of these coins. Assuming swaps will go through, and let's even assume we have everything vested, at that point there is definitely a different reputation consequences for the protocols selling the arbs, or for our dao to sell the protocols' tokens. For the protocol, selling the arb token will likely be ok, or even go unnoticed. For our DAO, it will likely be negative ("you don't support external protocols") to sell non arbitrum native protocols' tokens. It will be extremely negative to sell instead the token of arbitrum native one ("the dao doesn't even support GMX/Camelot/insert name of native arbitrum protocol"). It could potentially be ok to utilize them in yield generating strategies through a treasury manager, but the amount exchanged, since we have a cap of 500k, won't be worth the hassle in my opinion; plus, we are assuming that there will be good way to generate yield or that we will also have a treasury manager. TLDR: whatever token swap we do, it will be quite difficult for the DAO to sell these tokens.

In my view, the DAO should take a totally different approach to align protocols to the chain and foster growth: we should invest in protocols. This doesn't mean buying the token, but literally participating to raises of the protocols, and get a portion of the equity. This, to me, would make way more sense. We are not there yet because we need legal infrastructure that we don't have for example. But to me, not having yet the tools doesn't mean we should go for the path highlighted above.

As a final note, i want to say I appreciate the work done so far. I think the proposal is for sure better than the initial one, and I think the people added (paper, castlecap) add a ton of experience and professionality to this group. Despite this, I really can't find a way to frame the token swaps idea as a good idea for our DAO, sorry.

PennBlockchain from franklindao.eth

14.0K TOKEN

posted 2 years ago

We appreciate the work done for this Token Swap Pilot Program, but have some opinions and reservations:

What is the benefit for these projects to have even more ARB exposure? - By being integral apps of the Arbitrum ecosystem, ArbitrumDAO is already heavily incentivized to support these projects, and has done so through airdrops and variety of ARB incentive programs. The proposal doesn't clearly explain why further exposure to ARB is necessary for these crucial projects to operate effectively within the ecosystem.
Risks for the Treasury: This proposal could pose significant risks to the Treasury. The tokens in question tend to have a high beta and are strongly correlated with ARB’s price, which would amplify the Treasury's exposure to market volatility + idiosyncratic risks specific to projects. There is also the concern that these projects might use the opportunity to cash out of their less liquid tokens via ARB (after a 1 year lockup), potentially creating a perverse incentive where they focus less on their own token's long-term success. Similar to concerns raised by @lindsey
Better ways for projects to manage treasury volatility: If the goal is to reduce the exposure of these projects to the volatility of their own token prices, it would make more sense for them to conduct token sales and swap into assets with more stable values. Holding ARB does not seem to align with the objective of reducing overall treasury risk.
Effectiveness of token swaps: The cited report on "DAO Token Swaps as Ecosystem Enablers" does not provide compelling evidence that token swaps directly lead to better outcomes between an L2 like Arbitrum and the projects building on top of its ecosystem. While it outlines some reasons partnerships fail, it does not show a clear connection between token swaps and partnership success rates.
Who gets to be responsible for ArbitrumDAO's voting power? - We agree that it's nice for the ArbitrumDAO to have voting power in these projects - but who in the DAO should be responsible for the votes on behalf of ArbitrumDAO?

We appreciate the work done for this Token Swap Pilot Program, but have some opinions and reservations:

What is the benefit for these projects to have even more ARB exposure? - By being integral apps of the Arbitrum ecosystem, ArbitrumDAO is already heavily incentivized to support these projects, and has done so through airdrops and variety of ARB incentive programs. The proposal doesn't clearly explain why further exposure to ARB is necessary for these crucial projects to operate effectively within the ecosystem.
Risks for the Treasury: This proposal could pose significant risks to the Treasury. The tokens in question tend to have a high beta and are strongly correlated with ARB’s price, which would amplify the Treasury's exposure to market volatility + idiosyncratic risks specific to projects. There is also the concern that these projects might use the opportunity to cash out of their less liquid tokens via ARB (after a 1 year lockup), potentially creating a perverse incentive where they focus less on their own token's long-term success. Similar to concerns raised by @lindsey
Better ways for projects to manage treasury volatility: If the goal is to reduce the exposure of these projects to the volatility of their own token prices, it would make more sense for them to conduct token sales and swap into assets with more stable values. Holding ARB does not seem to align with the objective of reducing overall treasury risk.
Effectiveness of token swaps: The cited report on "DAO Token Swaps as Ecosystem Enablers" does not provide compelling evidence that token swaps directly lead to better outcomes between an L2 like Arbitrum and the projects building on top of its ecosystem. While it outlines some reasons partnerships fail, it does not show a clear connection between token swaps and partnership success rates.
Who gets to be responsible for ArbitrumDAO's voting power? - We agree that it's nice for the ArbitrumDAO to have voting power in these projects - but who in the DAO should be responsible for the votes on behalf of ArbitrumDAO?

In conclusion, a helpful way to frame this question is: If the Arbitrum Treasury were a venture capital firm, would investing in these projects yield a positive return, measured in both the marginal growth of ARB and appreciation in the tokens acquired? If these projects did not receive an investment, would their outcomes be significantly impacted? More importantly, do these projects currently lack the financial resources to achieve product-market fit and continue building/improving their apps?

SEEDGov from cattin.seedlatam.eth

7.8M TOKEN

posted 2 years ago

Hey, thanks you for this proposal!!.

We've been following the ongoing discussions, and while we acknowledge that this iteration of the initiative shows some improvements over the previous one, we share some of the concerns raised by other delegates. Additionally, we have a few questions and suggestions for consideration:

Hey, thanks you for this proposal!!.

Quoted from LuukDAO

To determine the exact swap size the following parameters will be considered:

Airdrop Size:

Airdrop % Sold:

Incentive Rewards received:

Market Cap:

FDV:

Lifetime Fees Generated:

6 month Fees Generated:

Lifetime GAS consumed:

6 month GAS consumed:

Project Treasury Size currently:

Token Pool depth on Arbitrum:

Token Utility:

ARB utility plan:

Have you thought of a calculation or formula that involves some of these variables in determining the size of the swap?

Quoted from LuukDAO

Each swap is capped at a maximum of 500,000 ARB, comparable to some previous swaps executed on Arbitrum One by GMX and its partners.

The proposed amount seems prudent. However, when we consider examples like GMX, even at the maximum allocation, it would represent only 6.25% of their current ARB holdings, which, from our perspective, may not be attractive to them. We understand that the limit is likely tied to the overall budget of 2M ARBs, which could be reasonable for a pilot program. That said, it may not be wise to discourage major protocols from participating in Arbitrum by restricting them to relatively insignificant amounts.

Quoted from LuukDAO

Non-Sales Clause

Arbitrum DAO and the third-party DAO will swap tokens with a 1-year lock. After the one-year lock, the tokens will unlock 10% monthly for ten months.

As other delegates have pointed out, having such a short lock-up period seems counterintuitive if the goal is long-term strategic alignment. We suggest implementing a minimum lock-up of 2 years, with a maximum of 4 years, while incorporating mechanisms that allow for early termination of the agreement in cases of force majeure. Additionally, exploring renewal mechanisms for the swap—similar to how swaps between nations are handled—could further strengthen the initiative.

Quoted from LuukDAO

Conflict of interest rules

The dealmakers are not allowed to be involved in a token swap if they have direct or indirect exposure to the counterparty; this includes holding over 0,001% of the total supply of the token personally or through the affiliated company and having a direct, active working relationship with this protocol.

Is there any conflict of interest (COI) to disclose between the four members proposed in this post and the 19 pre-selected protocols?

It would be important to have this clarified before the proposal is put to a vote, especially since, unlike other programs, both the protocols and contributors have already been pre-selected.

Quoted from LuukDAO

Still, if the pilot is successful, it may be an addition to future grant programs and expanded to prior STIP or LTIPP grantees.

Regarding the continuation/expansion of the program, our primary concern is that only a limited number of protocols on Arbitrum meet the following criteria:

Significant TVL and user base
Large market capitalization
Proven, battle-tested applications with mature governance
Revenue generation with long-term sustainability potential
Strong liquidity depth for their token
A sufficiently large treasury

Given these factors, it seems unlikely that the scope of swaps can be expanded beyond 5-10 protocols without introducing significant risks, at least under the current circumstances.

Quoted from LuukDAO

If no Arbitrum Treasury Management team is in place within nine months of executing the token swaps, the Pilot team will propose a solution for managing these tokens before they unlock.

What should we expect from the counterparty protocol? Considering they will have control over ARB tokens, it’s crucial to discuss whether we expect them to have adequate treasury management solutions in place before the tokens are unlocked.

Quoted from LuukDAO

Only projects that received the initial ARB airdrop and still hold at least 50% of their tokens, participated in one of the STIP or LTIPP programs, and have a token available on Arbitrum Mainnet will be eligible for this pilot.

Shouldn’t we assess how these protocols have managed grants in the past? Specifically, whether they adhered to the original plan (and if not, whether they adequately justified or communicated any changes) and whether they complied with reporting obligations. This would provide insight into the responsibility and diligence with which their teams operate.

Additional aspects to consider include:

Whether the protocols generate sufficient revenue to ensure long-term sustainability
Whether token holders benefit from this revenue through a distribution mechanism
The percentage of tokens already unlocked versus projected unlocks

In summary, our current position is as follows:

We have reservations about swapping ARB tokens at current prices and the potential upside of the tokens to be received.
Given the proposed swap sizes, we believe the impact on alignment would be limited if the swap involves protocols that already hold large amounts of ARB. However, this might be more attractive to those protocols that received smaller allocations during the TGE.
As mentioned earlier, there should be clear guidelines for dissolving the agreement, functioning as a “clawback” in force majeure situations (e.g., an exploit, cessation of operations, or a governance attack).
We do not believe this initiative contributes meaningfully to treasury diversification. Diversifying isn’t just about reducing the concentration of native assets in our treasury, but how we do so. If we’re swapping for assets of protocols strongly aligned with Arbitrum, particularly those who are native, their tokens are likely to be highly correlated with ARB’s price. In principle, true diversification would involve acquiring assets with lower correlation, which this situation does not offer. That said, this initiative could still serve as a controlled experiment in fostering collaboration and investment in other ecosystem protocols.

PGov from pgov.eth

301.00 TOKEN

posted 2 years ago

We appreciate the thoughtfulness behind the proposal and we're interested in the directional relationships with key projects while potentially offering the Arbitrum DAO new strategic advantages.

Some key areas for consideration, particularly regarding due diligence and the committee’s role:

We appreciate the thoughtfulness behind the proposal and we're interested in the directional relationships with key projects while potentially offering the Arbitrum DAO new strategic advantages.

Some key areas for consideration, particularly regarding due diligence and the committee’s role:

JoJo from jojothecow.eth

2.6M TOKEN

posted 2 years ago

I'm voting AGAINST this proposal in the temp check.

First of all, motivation seems unclear.

Quoted from LuukDAO

By embedding Token Swaps as a vital element of Arbitrum Ecosystem Development and critical programs such as LTIP, Arbitrum can continue pro-actively incentivizing ecosystem growth

I'm voting AGAINST this proposal in the temp check.

First of all, motivation seems unclear.

Quoted from LuukDAO

By embedding Token Swaps as a vital element of Arbitrum Ecosystem Development and critical programs such as LTIP, Arbitrum can continue pro-actively incentivizing ecosystem growth

This is what is stated here. In the initial discussion, which I don't know why it wasn't linked, it was instead presented with a different motivation.

Quoted from thedevanshmehta

Also, and maybe is me, I think this program is more a "virtue signal" than anything. Let me try to analyse the reasons why a protocol should do a token swap, knowing that the following are the terms.

Quoted from LuukDAO

PennBlockchain from franklindao.eth

14.0K TOKEN

posted 2 years ago

We appreciate the work done for this Token Swap Pilot Program, but have some opinions and reservations:

What is the benefit for these projects to have even more ARB exposure? - By being integral apps of the Arbitrum ecosystem, ArbitrumDAO is already heavily incentivized to support these projects, and has done so through airdrops and variety of ARB incentive programs. The proposal doesn't clearly explain why further exposure to ARB is necessary for these crucial projects to operate effectively within the ecosystem.
Risks for the Treasury: This proposal could pose significant risks to the Treasury. The tokens in question tend to have a high beta and are strongly correlated with ARB’s price, which would amplify the Treasury's exposure to market volatility + idiosyncratic risks specific to projects. There is also the concern that these projects might use the opportunity to cash out of their less liquid tokens via ARB (after a 1 year lockup), potentially creating a perverse incentive where they focus less on their own token's long-term success. Similar to concerns raised by @lindsey
Better ways for projects to manage treasury volatility: If the goal is to reduce the exposure of these projects to the volatility of their own token prices, it would make more sense for them to conduct token sales and swap into assets with more stable values. Holding ARB does not seem to align with the objective of reducing overall treasury risk.
Effectiveness of token swaps: The cited report on "DAO Token Swaps as Ecosystem Enablers" does not provide compelling evidence that token swaps directly lead to better outcomes between an L2 like Arbitrum and the projects building on top of its ecosystem. While it outlines some reasons partnerships fail, it does not show a clear connection between token swaps and partnership success rates.
Who gets to be responsible for ArbitrumDAO's voting power? - We agree that it's nice for the ArbitrumDAO to have voting power in these projects - but who in the DAO should be responsible for the votes on behalf of ArbitrumDAO?

We appreciate the work done for this Token Swap Pilot Program, but have some opinions and reservations:

What is the benefit for these projects to have even more ARB exposure? - By being integral apps of the Arbitrum ecosystem, ArbitrumDAO is already heavily incentivized to support these projects, and has done so through airdrops and variety of ARB incentive programs. The proposal doesn't clearly explain why further exposure to ARB is necessary for these crucial projects to operate effectively within the ecosystem.
Risks for the Treasury: This proposal could pose significant risks to the Treasury. The tokens in question tend to have a high beta and are strongly correlated with ARB’s price, which would amplify the Treasury's exposure to market volatility + idiosyncratic risks specific to projects. There is also the concern that these projects might use the opportunity to cash out of their less liquid tokens via ARB (after a 1 year lockup), potentially creating a perverse incentive where they focus less on their own token's long-term success. Similar to concerns raised by @lindsey
Better ways for projects to manage treasury volatility: If the goal is to reduce the exposure of these projects to the volatility of their own token prices, it would make more sense for them to conduct token sales and swap into assets with more stable values. Holding ARB does not seem to align with the objective of reducing overall treasury risk.
Effectiveness of token swaps: The cited report on "DAO Token Swaps as Ecosystem Enablers" does not provide compelling evidence that token swaps directly lead to better outcomes between an L2 like Arbitrum and the projects building on top of its ecosystem. While it outlines some reasons partnerships fail, it does not show a clear connection between token swaps and partnership success rates.
Who gets to be responsible for ArbitrumDAO's voting power? - We agree that it's nice for the ArbitrumDAO to have voting power in these projects - but who in the DAO should be responsible for the votes on behalf of ArbitrumDAO?

SEEDGov from cattin.seedlatam.eth

7.8M TOKEN

posted 2 years ago

Hey, thanks you for this proposal!!.

Quoted from LuukDAO

To determine the exact swap size the following parameters will be considered:

Airdrop Size:

Airdrop % Sold:

Incentive Rewards received:

Market Cap:

FDV:

Lifetime Fees Generated:

6 month Fees Generated:

Lifetime GAS consumed:

6 month GAS consumed:

Project Treasury Size currently:

Token Pool depth on Arbitrum:

Token Utility:

ARB utility plan:

Have you thought of a calculation or formula that involves some of these variables in determining the size of the swap?

Quoted from LuukDAO

Each swap is capped at a maximum of 500,000 ARB, comparable to some previous swaps executed on Arbitrum One by GMX and its partners.

Quoted from LuukDAO

Non-Sales Clause

Arbitrum DAO and the third-party DAO will swap tokens with a 1-year lock. After the one-year lock, the tokens will unlock 10% monthly for ten months.

Quoted from LuukDAO

Conflict of interest rules

Is there any conflict of interest (COI) to disclose between the four members proposed in this post and the 19 pre-selected protocols?

It would be important to have this clarified before the proposal is put to a vote, especially since, unlike other programs, both the protocols and contributors have already been pre-selected.

Quoted from LuukDAO

Still, if the pilot is successful, it may be an addition to future grant programs and expanded to prior STIP or LTIPP grantees.

Regarding the continuation/expansion of the program, our primary concern is that only a limited number of protocols on Arbitrum meet the following criteria:

Significant TVL and user base
Large market capitalization
Proven, battle-tested applications with mature governance
Revenue generation with long-term sustainability potential
Strong liquidity depth for their token
A sufficiently large treasury

Given these factors, it seems unlikely that the scope of swaps can be expanded beyond 5-10 protocols without introducing significant risks, at least under the current circumstances.

Quoted from LuukDAO

If no Arbitrum Treasury Management team is in place within nine months of executing the token swaps, the Pilot team will propose a solution for managing these tokens before they unlock.

Quoted from LuukDAO

Additional aspects to consider include:

Whether the protocols generate sufficient revenue to ensure long-term sustainability
Whether token holders benefit from this revenue through a distribution mechanism
The percentage of tokens already unlocked versus projected unlocks

In summary, our current position is as follows:

We have reservations about swapping ARB tokens at current prices and the potential upside of the tokens to be received.
Given the proposed swap sizes, we believe the impact on alignment would be limited if the swap involves protocols that already hold large amounts of ARB. However, this might be more attractive to those protocols that received smaller allocations during the TGE.
As mentioned earlier, there should be clear guidelines for dissolving the agreement, functioning as a “clawback” in force majeure situations (e.g., an exploit, cessation of operations, or a governance attack).
We do not believe this initiative contributes meaningfully to treasury diversification. Diversifying isn’t just about reducing the concentration of native assets in our treasury, but how we do so. If we’re swapping for assets of protocols strongly aligned with Arbitrum, particularly those who are native, their tokens are likely to be highly correlated with ARB’s price. In principle, true diversification would involve acquiring assets with lower correlation, which this situation does not offer. That said, this initiative could still serve as a controlled experiment in fostering collaboration and investment in other ecosystem protocols.

Quoted from cupojoseph

We want to incentivize teams that are focused on this ecosystem, not deploying everywhere and trying to extract. Example: I would rather the DAO own Dolomite over Aave, Open Dollar over Maker, and Camelot over Uniswap.

jump to post →

This is a great point and exactly what we would focus on in the pilot :smiley: Thanks for the positive feedback, definitely hoping the pilot will set up best practices that make it easy to integrate token swaps as a vital part of arbitrum ecosystem support programs. No more free money, give us your token in return!

Quoted from cupojoseph

% of protocol usage on arbitrum

jump to post →

@LuukDAO can comment on this criteria more specifically.

Quoted from pedrob

Thank you very much for the proposal. I have some comments and a few questions. Spoiler alert: I am strongly opposed to the proposal.

jump to post →

Really appreciate the engagement even if we don't fully agree! The long feedback process (1st version was posted in April 2024) has resulted in a more scoped out and specific proposal which iswasneeded. Criticism improves proposals which is a win for arbitrum!

I'll let @LuukDAO get into the specifics except to note a few general points;

As a DAO, we need to start getting a non-zero amount of a grantees tokens in exchange for our support. You might disagree with this, which is fine. I still think it the best way for ensuring that Arbitrum DAO captures an asymmetric upside in case our ecosystem support programs succeed and a grantee shoots off into the stratosphere.
We've seen with STEP just how long the legal pathway can take for the DAO to even own its own t-bills. Opening up this capability sooner rather than later increases the design space for our future grant and incentive programs (which is needed with both questbook and thrivecoin funds coming to an end and LTIP/STIP in a reflection period).
With STEP we've already learnt that delegates do not want to vote on individual service providers or deals. An expert committee negotiating with token swap recipients & the DAO ratifying their recommendations is a more legitimate process than a free for all vote like in STIP. Feedback from interested protocols is that "(token swap) deals really are more signaling." I also believe a committee representing Arbitrum is more likely to get us a better deal than a direct vote so the RoI for an implementation budget is positive.

Thanks James for engaging! Here are some quick responses;

Quoted from jameskbh

While that sounds interesting for the DAO, there was any signal from any protocol that this is a good initiative?

jump to post →

According to the eligibility criteria, these are the qualifying projects in the pilot program

Screenshot 2024-10-10 at 9.20.21 PM|690x280

We got feedback from 3 well known, arbitrum aligned projects in the list who are interested :saluting_face:

Quoted from jameskbh

1 yr locking only enables governance benefits for the protocol, and with the low amount per protocol, it may be not appealing.

jump to post →

One of the projects in the list actually gave the opposite feedback - "Would say 500k ARB as a cap makes sense but with many of the protocols swaps will be potentially quite oversized."

in any case, I think best to view this as a pilot that simply opens up the capability for ARB DAO to do token swaps. Similar to how STEP was intended to blocks in the DAO owning T-bills, which given the long process (still not done 3.5 months after our recommendations!) is something we should create the pathway for sooner rather than later, especially if we decide to integrate token swaps into long term incentive or grant programs.

Quoted from jameskbh

Not all 19 projects are DAOs. If ArbitrumDAO want to have the possibility to steer some governance discussions, how to do it in those cases? Or the list will be shorter than those 19 protocols?

jump to post →

With the small amounts in the pilot, we don't know if it makes sense for ARB DAO to have an active delegate in the protocols we swap with.

As one of the projects i reached out to said, "A reminder the deals really are more signaling, tokens (should be) locked on the books of both protocols."

pedrob from pedrobreuer.eth

581.3K TOKEN

posted 2 years ago

edited 2 years ago

Thank you very much for the proposal. I have some comments and a few questions. Spoiler alert: I am strongly opposed to the proposal.

Quoted from LuukDAO

Thank you very much for the proposal. I have some comments and a few questions. Spoiler alert: I am strongly opposed to the proposal.

Quoted from LuukDAO

One of the primary limitations of the initial incentive programs is that they were all one-directional, with Arbitrum treasury allocating ARB to projects and only receiving network transaction revenue in return.

I do not agree with this statement or the conclusion.

The STIP, LTIPP, and B.STIP programs directed incentives to users, not to protocols — even though the protocols served as the distribution mechanism and benefited from it. The objective (though sometimes unclear) of the programs was to drive activity on the chain, grow TVL, and increase volume, which was successfully achieved in all cases with the program launches.

And no, receiving network transaction revenue was not the only thing Arbitrum gained. Various protocols or new features of protocols were bootstrapped, the deployment of protocols on the chain was incentivized — many of them important during the LTIPP —, the DAO signaled that it is willing to incentivize DeFi use cases and the most important, it attracted sticky capital to the chain to consolidate liquidity and generate a network effect that benefits the entire ecosystem (users, developers, and protocols)

Quoted from LuukDAO

Moreover, Treasure DAO’s recent move from Arbitrum to ZKsync has shown that bidirectional, long-term alignment is even more critical, especially for protocols that play an essential role in the ArbitrumDAO ecosystem and have received significant ARB incentives.

I also disagree with this reflection on what happened with Treasure DAO. The reasons they gave for the change were purely related to the underlying technology. On the other hand, they were one of the two largest recipients of $ARB during the TGE. How would that decision have been any different if the DAO had held $MAGIC in its treasury?

Quoted from LuukDAO

By embedding Token Swaps as a vital element of Arbitrum Ecosystem Development and critical programs such as LTIP, Arbitrum can continue pro-actively incentivizing ecosystem growth while receiving additional upside and leverage in the most promising project’s building in its ecosystem.

This statement confuses me because 'ecosystem growth' is not later mentioned as a rationale or one of the program's objectives. Nor is it justified with data on how a token swap program lasting 1 year + 10 months could create that effect.

Referring to the rationale,

Quoted from LuukDAO

Increase bi-directional alignment with top ecosystem projects.

Given that this is the main objective of the program, I would love for you to define what you mean by bi-directional alignment.

Defining alignment is truly complex. A good debate on this topic is currently taking place as the DAO tries to reach a consensus on Arbitrum DAO’s Mission, Vision, and Goals.

If we go by what the Arbitrum Constitution states, the Arbitrum’s community guiding values are: Ethereum aligned, sustainable, secure, socially inclusive, technically inclusive, user-focused, and neutral and open.

What could the DAO demand as alignment from the protocols? That they operate exclusively on Arbitrum? That they don't join other ecosystems that aren’t aligned with Ethereum? That they must be sustainable or user-focused?

And on the other hand, how could the DAO be aligned (would that be bi-directional?) with the interests or vision of a protocol that has its own objectives?

Quoted from LuukDAO

Arbitrum DAO and the third-party DAO will swap tokens with a 1-year lock. After the one-year lock, the tokens will unlock 10% monthly for ten months.

I also don’t understand how a swap with a 1-year lock + 10 months to sell aligns with the long-term effectiveness and sustainability of ecosystem support programs, as mentioned in the Abstract. It seems like a very short time window for a program that aims to have a long-term effect

Quoted from LuukDAO

Program KPIs

This pilot’s objective is to better understand the impact and logistics of DAO token swaps as a value-alignment tool for growing Arbitrum DAO’s ecosystem.

Honestly, I don’t think token swaps are a necessary tool for value alignment. The DAO can invest resources to support the protocols it considers aligned or most valuable for the strategic development of the chain without needing to receive part of that protocol's treasury in return.

I believe the discussion happening in the post about the DAO’s Mission, Vision, and Goals is key, and in that sense, I like what @CastleCapital has proposed

Quoted from CastleCapital

The Bigger Picture

Screenshot 2024-10-04 at 13.14.04

jump to post →

In my opinion, the primary focus and destination of resources should be on developing the best technology that aligns with Ethereum's values. That way, we will ensure that the best Ethereum-aligned and thus, Arbitrum-aligned, protocols are here.

Quoted from LuukDAO

Pilot Program Implementation (timeline)

The Token Swap Pilot Council The initiative will comprise 3 voting members and 1 non-voting facilitating member.

Lastly, if the DAO approves this pilot, I also don’t understand the need for a Council to execute the swap. Since 19 potential applicants have been pre-selected, a window could simply be opened for interested parties to propose the swap, and the DAO could decide through a ranked choice vote. All that would be needed is a program manager

Thank you very much for promoting this discussion. Even though I don’t agree, it’s always positive to have these kinds of debates and explore alternatives for managing the treasury and achieving ecosystem growth, which is ultimately what we all want.

Quoted from cupojoseph

jump to post →

Quoted from cupojoseph

% of protocol usage on arbitrum

jump to post →

@LuukDAO can comment on this criteria more specifically.

Quoted from pedrob

Thank you very much for the proposal. I have some comments and a few questions. Spoiler alert: I am strongly opposed to the proposal.

jump to post →

I'll let @LuukDAO get into the specifics except to note a few general points;

As a DAO, we need to start getting a non-zero amount of a grantees tokens in exchange for our support. You might disagree with this, which is fine. I still think it the best way for ensuring that Arbitrum DAO captures an asymmetric upside in case our ecosystem support programs succeed and a grantee shoots off into the stratosphere.
We've seen with STEP just how long the legal pathway can take for the DAO to even own its own t-bills. Opening up this capability sooner rather than later increases the design space for our future grant and incentive programs (which is needed with both questbook and thrivecoin funds coming to an end and LTIP/STIP in a reflection period).
With STEP we've already learnt that delegates do not want to vote on individual service providers or deals. An expert committee negotiating with token swap recipients & the DAO ratifying their recommendations is a more legitimate process than a free for all vote like in STIP. Feedback from interested protocols is that "(token swap) deals really are more signaling." I also believe a committee representing Arbitrum is more likely to get us a better deal than a direct vote so the RoI for an implementation budget is positive.

Thanks James for engaging! Here are some quick responses;

Quoted from jameskbh

While that sounds interesting for the DAO, there was any signal from any protocol that this is a good initiative?

jump to post →

According to the eligibility criteria, these are the qualifying projects in the pilot program

Screenshot 2024-10-10 at 9.20.21 PM|690x280

We got feedback from 3 well known, arbitrum aligned projects in the list who are interested :saluting_face:

Quoted from jameskbh

1 yr locking only enables governance benefits for the protocol, and with the low amount per protocol, it may be not appealing.

jump to post →

One of the projects in the list actually gave the opposite feedback - "Would say 500k ARB as a cap makes sense but with many of the protocols swaps will be potentially quite oversized."

Quoted from jameskbh

Not all 19 projects are DAOs. If ArbitrumDAO want to have the possibility to steer some governance discussions, how to do it in those cases? Or the list will be shorter than those 19 protocols?

jump to post →

With the small amounts in the pilot, we don't know if it makes sense for ARB DAO to have an active delegate in the protocols we swap with.

As one of the projects i reached out to said, "A reminder the deals really are more signaling, tokens (should be) locked on the books of both protocols."

pedrob from pedrobreuer.eth

581.3K TOKEN

posted 2 years ago

edited 2 years ago

Thank you very much for the proposal. I have some comments and a few questions. Spoiler alert: I am strongly opposed to the proposal.

Quoted from LuukDAO

Thank you very much for the proposal. I have some comments and a few questions. Spoiler alert: I am strongly opposed to the proposal.

Quoted from LuukDAO

I do not agree with this statement or the conclusion.

Quoted from LuukDAO

Referring to the rationale,

Quoted from LuukDAO

Increase bi-directional alignment with top ecosystem projects.

Given that this is the main objective of the program, I would love for you to define what you mean by bi-directional alignment.

Defining alignment is truly complex. A good debate on this topic is currently taking place as the DAO tries to reach a consensus on Arbitrum DAO’s Mission, Vision, and Goals.

And on the other hand, how could the DAO be aligned (would that be bi-directional?) with the interests or vision of a protocol that has its own objectives?

Quoted from LuukDAO

Arbitrum DAO and the third-party DAO will swap tokens with a 1-year lock. After the one-year lock, the tokens will unlock 10% monthly for ten months.

Quoted from LuukDAO

Program KPIs

This pilot’s objective is to better understand the impact and logistics of DAO token swaps as a value-alignment tool for growing Arbitrum DAO’s ecosystem.

I believe the discussion happening in the post about the DAO’s Mission, Vision, and Goals is key, and in that sense, I like what @CastleCapital has proposed

Quoted from CastleCapital

The Bigger Picture

Screenshot 2024-10-04 at 13.14.04

jump to post →

Quoted from LuukDAO

Pilot Program Implementation (timeline)

The Token Swap Pilot Council The initiative will comprise 3 voting members and 1 non-voting facilitating member.

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

Steps to Implement

Pilot Program Implementation (timeline)

Helpful links:

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

Steps to Implement

Pilot Program Implementation (timeline)

Helpful links:

Steps to Implement

Pilot Program Implementation (timeline)

Helpful links:

Steps to Implement

Pilot Program Implementation (timeline)

Helpful links:

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

[Non-Constitutional] Arbitrum Token Swap Pilot Program

Rationale

Rationale

Rationale

Rationale

The Bigger Picture

Pilot Program Implementation (timeline)

The Bigger Picture

Pilot Program Implementation (timeline)