The Arbitrum DAO’s treasury management strategy and execution have become fragmented due to the numerous committees overseeing various initiatives.
We propose phasing out the TMC, GMC, and STEP committees and replacing them with a canonical 3-unit committee (Arbitrum Treasury Management Council) to enhance the cohesion/effectiveness of the DAO’s treasury management strategy.
The new Arbitrum Treasury Management Council comprises:
In addition to the 3-unit council, the following AAEs will serve observatory roles to ensure wider ecosystem alignment and smooth operations as it relates to fund deployment:
Delegates will approve high-level strategies and capital allocations to the council. More granular decisions suggested by the Execution Body (e.g., reallocating capital across providers, or allocation recommendations) have to be approved by the OAT, which has DAO representation as well as key members from OCL and the AF.
All of the council members have funding sources in place, so there will be no additional overhead related to paying these contributing entities. In terms of the remaining balance to pay the previous councils/committees (TMC & GMC) that currently sits with the AF, this will be repurposed to cover service providers’ costs for specialized deliverables that the new canonical council does not possess competency to fulfil, e.g., granular risk, legal, etc. The roles of each council member are further defined below.
The Arbitrum DAO now has 3 separate initiatives related to its treasury management strategy between the TMC, GMC, and the STEP committee. The TMC focuses on ARB and stablecoins, while the GMC focuses on ETH allocations, and the STEP committee focuses on RWAs. The following entities/individuals sit on councils overseeing these initiatives, with their respective pay defined below:
To summarize, the DAO has ~$581,000 of overhead associated with treasury management activity, assuming an ARB price of $0.285 (realised dollar-denominated spend is higher, as ARB price has fallen since previous payments to contributors). The total AUM amongst all of these programs is approximately $50M, with the total yield earned on the underlying thus far amounting to ~$590k. The DAO has just recently broken even on its treasury management initiatives. However, it is worth noting that not all of the funds have been deployed from the TMC and GMC proposals, which are expected to accelerate passive yield inflows.
Entropy Advisors has been involved in all 3 committees, and we see some areas in need of improvement. Outside of cutting down on the dollar-denominated expenses associated with running these programs in a way that only scales with the size of the programs, the sheer number of people involved in the act of treasury management without clear responsibilities is counterintuitive. It is difficult to coordinate calls across so many teams’/individuals’ calendars, none of the committees actually speak to one another thus resulting in a fragmented strategy for the Arbitrum DAO’s treasury, each committee usually ends up in a state where a minority of members ultimately produce a majority of the work required for execution, communication between applicants and individual committees/their members often becomes fragmented (the applicant may not know who to reach out to in order to discuss certain things relevant to the application process), etc. Additionally, all of these committee members have varying degrees of insight into things in the pipeline for the Arbitrum ecosystem, which often sets these contributors up to make misinformed decisions due to missing context.
With Timeboost officially live, the DAO treasury has again reached >7,500 ETH since the last TM v1.2 proposal passed on Tally, as well as other ongoing initiatives such as the GCP that will generate additional revenue over time, we must be able to deploy some of these assets into yield bearing strategies as they accrue to the treasury. It’s time to reduce fragmentation and streamline the decision-making processes.
Four open discussions on this matter were hosted on April 30, 2025, May 14, 2025, May 28, 2025, and June 11, 2025, with recordings available here, here, here, and here. We recommend watching these, and joining future calls on the topic if you have strong opinions to share.
In line with the new vision laid out by the Arbitrum Foundation, we propose that Entropy Advisors serves as the “Treasurer” with the OAT in place to approve/deny usage of budgets allocated to treasury initiatives, with the council including two of the most aligned AAEs, the AF and OCL, as observatory members to help inform and execute on strategy. This will enable the DAO to approve high-level strategies that do not go against Arbitrum’s broader strategy, considering the insight the AF and OCL will have in regards to ongoing BD efforts/opportunities as well as any operational complexities related to deploying and custodying funds. It will also reduce overhead, unify strategy, and empower Entropy to outsource specific needs to service providers with concrete deliverables on an as-needed basis, thus decreasing the principal-agent problem we face under the current structure with fragmented committees.
Entropy Advisors will have the autonomy to make decisions with funds pre-approved by the DAO, but all decisions must be passed by the OAT with ⅗ approval. Any decision that does not receive ⅗ approval from the OAT will be considered denied and no funds will be allocated. This includes reallocating from one asset/strategy to another, thus giving the DAO the ability to respond to changing market conditions and to hold vendors accountable. Any/All fund movements will be accompanied with an update on the forum in order to keep the wider community informed. Again, this process only pertains to funds that have already been approved for allocation by the DAO, but the standard governance process will always be required to earmark funds for deployment. Assets already approved by the DAO for deployment (STEP I&II, TMC, GMC) will be eligible for reallocation, in accordance to the process herein, per this proposal’s passing.
The non-exhaustive, high-level responsibilities of this council and its observers will include:
Voting Body
Allocations Review - OAT
Execution Body
Treasurer - Entropy Advisors
Risk Management & Miscellaneous - Likely areas for outsourcing to SPs
Communications Body
DAO Orchestration - OpCo (Entropy Advisors in the interim)
Observatory Body
Operational Execution - Arbitrum Foundation
Ecosystem Support - Offchain Labs
The remaining funds from the TM v1.2 proposal that were allocated to pay TMC and GMC members for their work (1M ARB) will be repurposed to this canonical treasury council to contract SPs to fulfill required duties as they arise, likely related to the “Risk Management & Miscellaneous” deliverables defined above.
Given that all 5 of the entities involved in the Arbitrum Treasury Management Council are DAO-funded AAEs (or in the case of OCL, project founders), it does not make sense to have a mechanism in place to remove specific members. However, it is important to ensure the DAO remains in complete control over its treasury assets. As such, any DAO contributor can disband the Arbitrum Treasury Management Council entirely by getting a proposal through Snapshot that garners 3% of the votable token supply in favor of the council’s disbandment. The onus of replacing this initiative with a new structure i.e., council members, budgeting/forecasting/ reporting cadence, risk management, SP procurement, etc., will fall on the contributor that is proposing the abolishment of the Arbitrum Treasury Management Council. The contributor seeking abolishment will also need to define what happens to the currently deployed assets e.g., funds pulled from strategies and returned to the treasury. We expect delegates to be cognizant of this, and to hold contributors that seek abolishment of the Arbitrum Treasury Management Council to high standards in regards to the defined transition from the proposed structure herein to its proposed replacement. Also note that the responsibility of fund movement and custody can be transferred to OpCo via a DAO vote on Snapshot that garners 3% of the votable token supply in favor/abstain of the shift of responsibility.
Hypothetical Workflow Example:
The council identifies additional ETH in the DAO’s treasury that is not currently being utilized and wishes to allocate these funds to begin earning additional yield. The "DAO Orchestration” member works with the “Treasurer” member to draft a proposal to the DAO seeking to earmark these funds for deployment, taking into account various risk factors and the current treasury composition. The AF and OCL would be charged with providing input on the draft based on compliance and deployment feasibility, as well as any upcoming strategic partnerships that could align well with a DAO deployment of capital. The general goals of the deployed capital will be loosely defined in these proposals, as to provide the treasurer with flexibility, but also to impose guardrails/ensure the capital is deployed in a manner that achieves the goals the DAO desires. Prior to the DAO Orchestration member posting this proposal to the forum, a ⅗ consensus amongst the OAT will be required.
Assuming this proposal passes through the standard Arbitrum DAO governance process and the funds are transferred to the AF’s control, the Treasurer would begin drafting outbound materials to conduct protocol outreach/SP procurement for fund deployment. Similar to the proposal above seeking funds from the DAO, a ⅗ consensus will be required amongst the OAT prior to any funds being deployed. Likewise, if the Treasurer wishes to reallocate funds from STEP I/II to a different provider because the initial provider did not execute on what was originally promised (e.g., failing to deploy the tokenized asset on Arbitrum One), this will require ⅗ approval from the OAT. This ensures that funds can be moved without hurting relationships with existing vendors due to the negative PR that could stem from a reallocation that currently requires a high-profile DAO vote.
Note that, as always, the DAO remains in ultimate control. Any allocations made by this council can be clawed back to the DAO treasury, or be forced to be reallocated by the Execution Body, via a Snapshot vote that garners 3% of the votable token supply in favor of the clawback or forced reallocation. Also note, the OAT will be able to initiate emergency actions with ⅗ approval to pull out funds from a prior allocation, with the rationale posted to the forum immediately.
It was made evident in the recent community call, as well as on the forum, that the DAO needs to have a process for spending stables/cash during periods in which it would rather not monetize treasury ARB to cover dollar-denominated expenses, or to cover service provider shortfalls that arise due to downward ARB price volatility.
Moving forward, we propose the “DAOs checking account” is taken over by the Arbitrum Foundation with full discretion on how it can be spent. For example, it can be used to cover service provider shortfalls or to cover dollar-denominated expenses in proposals that pass through Tally. Note, if a draft DAO proposal wants to access the funds, then it is recommended they contact the Arbitrum Foundation who will decide whether the assets can be used, before putting the DAO proposal up for a vote.
The Arbitrum Foundation will be required to adhere to any future structures that arise, including, but not limited to, a DAO budget or Net Working Capital requirements. This requirement is only related to the DAO’s treasury management initiative, and does not pertain to the AF’s current operations / existing budget. The AF will be required to confer with the Treasurer (Entropy) and inform the DAO Orchestration member (OpCo once operationalized) so that financial frameworks are followed, capital movements can be accounted for, and the DAO stays informed. The Treasurer will continually evaluate Net Working Capital developments, and make proposals to the DAO accordingly to ensure short-term liabilities can be met.
Please note that after speaking with the AF on May 30th, some changes to the "DAO's Checking Account" section were made.
There will be no additional overhead related to these contributing entities, as they aren’t being compensated for their services in relation to the treasury management strategy and execution under this proposal. As such, the costs associated with this proposal, excluding SP expenses required to fulfill Risk/Miscellaneous-related work, will be zero. The budget already approved to pay the GMC and TMC members is expected to cover all overhead related to needed SPs over the near-to-medium term.
There are likely to be indirect costs associated with each fund deployment (treasury management fees, tokenized RWA fees, etc), and all of these costs will be disclosed in quarterly updates from the Treasurer or in the regular updates posted by the DAO Orchestration member.
Note that this proposal will only require a Snapshot vote that garners 3% of the votable token supply in favor/abstain of the Arbitrum Treasury Management Council’s implementation, and thus mark the wind down of the GMC, TMC, and STEP committee mandates. This is in-line with terms laid out in the treasury management v1.2 proposal.
Through our proposed architecture herein, the DAO will deploy assets from its treasury with lower overhead and more accountability over each member's contributions, develop a more cohesive overall strategy, provide applicants with clear points of contact with streamlined channels for receiving proposal feedback, have comprehensive financial reporting/live monitoring, will not make any decisions without maximum context through the AF’s and OCL’s involvement, and will have dedicated resources to ensure risk evaluation over all treasury management initiatives in order to maximize safety over the DAO’s assets.
We look forward to the community’s feedback.
Disclaimer: Although Entropy Advisors and the rest of the Arbitrum Treasury Management Council will do everything possible to ensure the safety of deployed assets, crypto is experimental technology from a security and economic design perspective. Entropy Advisors, or other members of the Arbitrum Treasury Management Council, cannot be held responsible/liable for any of the risks associated with fund deployment.
The Arbitrum DAO’s treasury management strategy and execution have become fragmented due to the numerous committees overseeing various initiatives.
We propose phasing out the TMC, GMC, and STEP committees and replacing them with a canonical 3-unit committee (Arbitrum Treasury Management Council) to enhance the cohesion/effectiveness of the DAO’s treasury management strategy.
The new Arbitrum Treasury Management Council comprises:
In addition to the 3-unit council, the following AAEs will serve observatory roles to ensure wider ecosystem alignment and smooth operations as it relates to fund deployment:
Delegates will approve high-level strategies and capital allocations to the council. More granular decisions suggested by the Execution Body (e.g., reallocating capital across providers, or allocation recommendations) have to be approved by the OAT, which has DAO representation as well as key members from OCL and the AF.
All of the council members have funding sources in place, so there will be no additional overhead related to paying these contributing entities. In terms of the remaining balance to pay the previous councils/committees (TMC & GMC) that currently sits with the AF, this will be repurposed to cover service providers’ costs for specialized deliverables that the new canonical council does not possess competency to fulfil, e.g., granular risk, legal, etc. The roles of each council member are further defined below.
The Arbitrum DAO now has 3 separate initiatives related to its treasury management strategy between the TMC, GMC, and the STEP committee. The TMC focuses on ARB and stablecoins, while the GMC focuses on ETH allocations, and the STEP committee focuses on RWAs. The following entities/individuals sit on councils overseeing these initiatives, with their respective pay defined below:
To summarize, the DAO has ~$581,000 of overhead associated with treasury management activity, assuming an ARB price of $0.285 (realised dollar-denominated spend is higher, as ARB price has fallen since previous payments to contributors). The total AUM amongst all of these programs is approximately $50M, with the total yield earned on the underlying thus far amounting to ~$590k. The DAO has just recently broken even on its treasury management initiatives. However, it is worth noting that not all of the funds have been deployed from the TMC and GMC proposals, which are expected to accelerate passive yield inflows.
Entropy Advisors has been involved in all 3 committees, and we see some areas in need of improvement. Outside of cutting down on the dollar-denominated expenses associated with running these programs in a way that only scales with the size of the programs, the sheer number of people involved in the act of treasury management without clear responsibilities is counterintuitive. It is difficult to coordinate calls across so many teams’/individuals’ calendars, none of the committees actually speak to one another thus resulting in a fragmented strategy for the Arbitrum DAO’s treasury, each committee usually ends up in a state where a minority of members ultimately produce a majority of the work required for execution, communication between applicants and individual committees/their members often becomes fragmented (the applicant may not know who to reach out to in order to discuss certain things relevant to the application process), etc. Additionally, all of these committee members have varying degrees of insight into things in the pipeline for the Arbitrum ecosystem, which often sets these contributors up to make misinformed decisions due to missing context.
With Timeboost officially live, the DAO treasury has again reached >7,500 ETH since the last TM v1.2 proposal passed on Tally, as well as other ongoing initiatives such as the GCP that will generate additional revenue over time, we must be able to deploy some of these assets into yield bearing strategies as they accrue to the treasury. It’s time to reduce fragmentation and streamline the decision-making processes.
Four open discussions on this matter were hosted on April 30, 2025, May 14, 2025, May 28, 2025, and June 11, 2025, with recordings available here, here, here, and here. We recommend watching these, and joining future calls on the topic if you have strong opinions to share.
In line with the new vision laid out by the Arbitrum Foundation, we propose that Entropy Advisors serves as the “Treasurer” with the OAT in place to approve/deny usage of budgets allocated to treasury initiatives, with the council including two of the most aligned AAEs, the AF and OCL, as observatory members to help inform and execute on strategy. This will enable the DAO to approve high-level strategies that do not go against Arbitrum’s broader strategy, considering the insight the AF and OCL will have in regards to ongoing BD efforts/opportunities as well as any operational complexities related to deploying and custodying funds. It will also reduce overhead, unify strategy, and empower Entropy to outsource specific needs to service providers with concrete deliverables on an as-needed basis, thus decreasing the principal-agent problem we face under the current structure with fragmented committees.
Entropy Advisors will have the autonomy to make decisions with funds pre-approved by the DAO, but all decisions must be passed by the OAT with ⅗ approval. Any decision that does not receive ⅗ approval from the OAT will be considered denied and no funds will be allocated. This includes reallocating from one asset/strategy to another, thus giving the DAO the ability to respond to changing market conditions and to hold vendors accountable. Any/All fund movements will be accompanied with an update on the forum in order to keep the wider community informed. Again, this process only pertains to funds that have already been approved for allocation by the DAO, but the standard governance process will always be required to earmark funds for deployment. Assets already approved by the DAO for deployment (STEP I&II, TMC, GMC) will be eligible for reallocation, in accordance to the process herein, per this proposal’s passing.
The non-exhaustive, high-level responsibilities of this council and its observers will include:
Voting Body
Allocations Review - OAT
Execution Body
Treasurer - Entropy Advisors
Risk Management & Miscellaneous - Likely areas for outsourcing to SPs
Communications Body
DAO Orchestration - OpCo (Entropy Advisors in the interim)
Observatory Body
Operational Execution - Arbitrum Foundation
Ecosystem Support - Offchain Labs
The remaining funds from the TM v1.2 proposal that were allocated to pay TMC and GMC members for their work (1M ARB) will be repurposed to this canonical treasury council to contract SPs to fulfill required duties as they arise, likely related to the “Risk Management & Miscellaneous” deliverables defined above.
Given that all 5 of the entities involved in the Arbitrum Treasury Management Council are DAO-funded AAEs (or in the case of OCL, project founders), it does not make sense to have a mechanism in place to remove specific members. However, it is important to ensure the DAO remains in complete control over its treasury assets. As such, any DAO contributor can disband the Arbitrum Treasury Management Council entirely by getting a proposal through Snapshot that garners 3% of the votable token supply in favor of the council’s disbandment. The onus of replacing this initiative with a new structure i.e., council members, budgeting/forecasting/ reporting cadence, risk management, SP procurement, etc., will fall on the contributor that is proposing the abolishment of the Arbitrum Treasury Management Council. The contributor seeking abolishment will also need to define what happens to the currently deployed assets e.g., funds pulled from strategies and returned to the treasury. We expect delegates to be cognizant of this, and to hold contributors that seek abolishment of the Arbitrum Treasury Management Council to high standards in regards to the defined transition from the proposed structure herein to its proposed replacement. Also note that the responsibility of fund movement and custody can be transferred to OpCo via a DAO vote on Snapshot that garners 3% of the votable token supply in favor/abstain of the shift of responsibility.
Hypothetical Workflow Example:
The council identifies additional ETH in the DAO’s treasury that is not currently being utilized and wishes to allocate these funds to begin earning additional yield. The "DAO Orchestration” member works with the “Treasurer” member to draft a proposal to the DAO seeking to earmark these funds for deployment, taking into account various risk factors and the current treasury composition. The AF and OCL would be charged with providing input on the draft based on compliance and deployment feasibility, as well as any upcoming strategic partnerships that could align well with a DAO deployment of capital. The general goals of the deployed capital will be loosely defined in these proposals, as to provide the treasurer with flexibility, but also to impose guardrails/ensure the capital is deployed in a manner that achieves the goals the DAO desires. Prior to the DAO Orchestration member posting this proposal to the forum, a ⅗ consensus amongst the OAT will be required.
Assuming this proposal passes through the standard Arbitrum DAO governance process and the funds are transferred to the AF’s control, the Treasurer would begin drafting outbound materials to conduct protocol outreach/SP procurement for fund deployment. Similar to the proposal above seeking funds from the DAO, a ⅗ consensus will be required amongst the OAT prior to any funds being deployed. Likewise, if the Treasurer wishes to reallocate funds from STEP I/II to a different provider because the initial provider did not execute on what was originally promised (e.g., failing to deploy the tokenized asset on Arbitrum One), this will require ⅗ approval from the OAT. This ensures that funds can be moved without hurting relationships with existing vendors due to the negative PR that could stem from a reallocation that currently requires a high-profile DAO vote.
Note that, as always, the DAO remains in ultimate control. Any allocations made by this council can be clawed back to the DAO treasury, or be forced to be reallocated by the Execution Body, via a Snapshot vote that garners 3% of the votable token supply in favor of the clawback or forced reallocation. Also note, the OAT will be able to initiate emergency actions with ⅗ approval to pull out funds from a prior allocation, with the rationale posted to the forum immediately.
It was made evident in the recent community call, as well as on the forum, that the DAO needs to have a process for spending stables/cash during periods in which it would rather not monetize treasury ARB to cover dollar-denominated expenses, or to cover service provider shortfalls that arise due to downward ARB price volatility.
Moving forward, we propose the “DAOs checking account” is taken over by the Arbitrum Foundation with full discretion on how it can be spent. For example, it can be used to cover service provider shortfalls or to cover dollar-denominated expenses in proposals that pass through Tally. Note, if a draft DAO proposal wants to access the funds, then it is recommended they contact the Arbitrum Foundation who will decide whether the assets can be used, before putting the DAO proposal up for a vote.
The Arbitrum Foundation will be required to adhere to any future structures that arise, including, but not limited to, a DAO budget or Net Working Capital requirements. This requirement is only related to the DAO’s treasury management initiative, and does not pertain to the AF’s current operations / existing budget. The AF will be required to confer with the Treasurer (Entropy) and inform the DAO Orchestration member (OpCo once operationalized) so that financial frameworks are followed, capital movements can be accounted for, and the DAO stays informed. The Treasurer will continually evaluate Net Working Capital developments, and make proposals to the DAO accordingly to ensure short-term liabilities can be met.
Please note that after speaking with the AF on May 30th, some changes to the "DAO's Checking Account" section were made.
There will be no additional overhead related to these contributing entities, as they aren’t being compensated for their services in relation to the treasury management strategy and execution under this proposal. As such, the costs associated with this proposal, excluding SP expenses required to fulfill Risk/Miscellaneous-related work, will be zero. The budget already approved to pay the GMC and TMC members is expected to cover all overhead related to needed SPs over the near-to-medium term.
There are likely to be indirect costs associated with each fund deployment (treasury management fees, tokenized RWA fees, etc), and all of these costs will be disclosed in quarterly updates from the Treasurer or in the regular updates posted by the DAO Orchestration member.
Note that this proposal will only require a Snapshot vote that garners 3% of the votable token supply in favor/abstain of the Arbitrum Treasury Management Council’s implementation, and thus mark the wind down of the GMC, TMC, and STEP committee mandates. This is in-line with terms laid out in the treasury management v1.2 proposal.
Through our proposed architecture herein, the DAO will deploy assets from its treasury with lower overhead and more accountability over each member's contributions, develop a more cohesive overall strategy, provide applicants with clear points of contact with streamlined channels for receiving proposal feedback, have comprehensive financial reporting/live monitoring, will not make any decisions without maximum context through the AF’s and OCL’s involvement, and will have dedicated resources to ensure risk evaluation over all treasury management initiatives in order to maximize safety over the DAO’s assets.
We look forward to the community’s feedback.
Disclaimer: Although Entropy Advisors and the rest of the Arbitrum Treasury Management Council will do everything possible to ensure the safety of deployed assets, crypto is experimental technology from a security and economic design perspective. Entropy Advisors, or other members of the Arbitrum Treasury Management Council, cannot be held responsible/liable for any of the risks associated with fund deployment.
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/43?u=0x_ultra
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/41?u=bob-rossi
this will bring more accountability and less overhead. https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/40?u=paulofonseca
https://forum.arbitrum.foundation/t/tekr0x-eth-delegate-communication-thread/24804/19?u=tekr0x.eth
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/32?u=euphoria
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/43?u=0x_ultra
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/41?u=bob-rossi
this will bring more accountability and less overhead. https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/40?u=paulofonseca
https://forum.arbitrum.foundation/t/tekr0x-eth-delegate-communication-thread/24804/19?u=tekr0x.eth
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/32?u=euphoria
Democratising lobbyism, on-chain. Check out lobbyfi.xyz
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/39?u=ocandocrypto
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/38
The Event Horizon Community voted on this proposal (ehARB-113): EventHorizon.vote/vote/arbitrum/ehARB-113
For. Simplifying treasury management aligns with driving adoption and efficiency in DeFi, ensuring a seamless, uninterrupted workflow for effective oversight.
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/20?u=castlecapital
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/37?u=griff
https://forum.arbitrum.foundation/t/gfx-labs-delegate-communication-thread/13794
https://forum.arbitrum.foundation/t/constitutional-aip-remove-cost-cap-on-arbitrum-nova/29332/27?u=dragonawr
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/31
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/30?u=0xalex
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/29?u=maxlomu
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/28?u=danielm
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/26
Consolidation makes sense from an efficiency standpoint. But we have some concerns about oversight and long-term capture. Full reasoning here: https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/25?u=pennblockchain
After carefully reviewing the proposal, I believe it offers a crucial step toward more effective, streamlined, and cost-efficient treasury management for the Arbitrum DAO. Consolidating fragmented committees into a single council clearly addresses operational inefficiencies and cost overruns currently experienced. However, to mitigate concerns around centralization, accountability, and dependence on a single entity, I suggest incorporating the following amendments as a potential solution: Periodic Review and Rotation: Introduce structured term limits or periodic performance reviews for key council roles, allowing fresh perspectives and reducing centralization risk. Diversified Operational Execution: Explicitly define the tasks to be delegated or outsourced beyond Entropy Advisors, ensuring no single entity holds disproportionate operational control. Enhanced Emergency Response Protocols: Adjust emergency action requirements to a simpler majority or provide a fast-track emergency clause, allowing rapid decision-making during critical scenarios. Broader Community Oversight: Regular community forums and transparency reports on treasury management decisions to enhance oversight and active participation.
Every prototype deserves its evolution. I believe Arbitrum DAO has done very well with the existing structure, but it's always the right time to embrace change and try new things. I say yes to both, to evolution and continuous improvement.
Democratising lobbyism, on-chain. Check out lobbyfi.xyz
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/39?u=ocandocrypto
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/38
The Event Horizon Community voted on this proposal (ehARB-113): EventHorizon.vote/vote/arbitrum/ehARB-113
For. Simplifying treasury management aligns with driving adoption and efficiency in DeFi, ensuring a seamless, uninterrupted workflow for effective oversight.
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/20?u=castlecapital
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/37?u=griff
https://forum.arbitrum.foundation/t/gfx-labs-delegate-communication-thread/13794
https://forum.arbitrum.foundation/t/constitutional-aip-remove-cost-cap-on-arbitrum-nova/29332/27?u=dragonawr
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/31
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/30?u=0xalex
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/29?u=maxlomu
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/28?u=danielm
https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/26
Consolidation makes sense from an efficiency standpoint. But we have some concerns about oversight and long-term capture. Full reasoning here: https://forum.arbitrum.foundation/t/arbitrum-treasury-management-council-consolidating-efforts/29334/25?u=pennblockchain
After carefully reviewing the proposal, I believe it offers a crucial step toward more effective, streamlined, and cost-efficient treasury management for the Arbitrum DAO. Consolidating fragmented committees into a single council clearly addresses operational inefficiencies and cost overruns currently experienced. However, to mitigate concerns around centralization, accountability, and dependence on a single entity, I suggest incorporating the following amendments as a potential solution: Periodic Review and Rotation: Introduce structured term limits or periodic performance reviews for key council roles, allowing fresh perspectives and reducing centralization risk. Diversified Operational Execution: Explicitly define the tasks to be delegated or outsourced beyond Entropy Advisors, ensuring no single entity holds disproportionate operational control. Enhanced Emergency Response Protocols: Adjust emergency action requirements to a simpler majority or provide a fast-track emergency clause, allowing rapid decision-making during critical scenarios. Broader Community Oversight: Regular community forums and transparency reports on treasury management decisions to enhance oversight and active participation.
Every prototype deserves its evolution. I believe Arbitrum DAO has done very well with the existing structure, but it's always the right time to embrace change and try new things. I say yes to both, to evolution and continuous improvement.
The current fragmentation between the different committees has resulted in operational inefficiencies, overlapping mandates, and elevated overhead. We welcome the proposal to consolidate these functions under a single, unified body - as an important step toward streamlining treasury governance. The proposed council introduces a more agile, accountable, and strategically aligned framework with reduced bureaucracy.
Given the DAO’s substantial holdings across Real-World Assets (RWA) and DeFi, consolidating asset management is both logical and beneficial from a cost-efficiency and oversight standpoint. This move would centralize responsibility, enhance transparency, and provide the DAO with a singular point of contact for treasury operations.
The current fragmentation between the different committees has resulted in operational inefficiencies, overlapping mandates, and elevated overhead. We welcome the proposal to consolidate these functions under a single, unified body - as an important step toward streamlining treasury governance. The proposed council introduces a more agile, accountable, and strategically aligned framework with reduced bureaucracy.
Given the DAO’s substantial holdings across Real-World Assets (RWA) and DeFi, consolidating asset management is both logical and beneficial from a cost-efficiency and oversight standpoint. This move would centralize responsibility, enhance transparency, and provide the DAO with a singular point of contact for treasury operations.
That said, we would appreciate further detail on how the council plans to measure and report performance. Considering the scale of the treasury, implementing a real-time dashboard for visibility into asset allocations and key metrics would significantly improve transparency.
We strongly support a transparent and merit-based selection process for future service providers. Outsourcing specific responsibilities to qualified experts, while maintaining cost discipline, will ensure the DAO benefits from high-quality management with minimal operational overhead.
We had a chance to speak with the Entropy team, and this proposal looks like a cost-effective solution for the DAO. Right now, Entropy has enough resources to manage the program on their own. As the program grows, they plan to bring in more people. They also addressed our concerns about centralization. The nomination process for selecting the treasury provider will be public and transparent.
The following reflects the views of GMX’s Governance Committee, and is based on the combined research, evaluation, consensus, and ideation of various committee members.
First of all, thank you for this proposal. How the treasury management is handled has been a long and complex process for Arbitrum, which led to the formation of many different committees. Therefore, addressing and organizing this issue is very important. In particular, the fragmented treasury management structure can cause communication difficulties between committees, potentially leading to conflicts in decision-making and challenges in risk management. For this reason, the idea of unifying the scattered structure under a single umbrella is quite sensible. Additionally, the establishment of an oversight and coordination body — composed of representatives from AF and Offchain Labs — is one of the key factors that increases the proposal’s reliability and feasibility. We also believe it is critical for this oversight body to regularly share reports and serve in an advisory role. For all these reasons, we support the proposal.
ITU Governance, @harryvors
The current fragmentation between the different committees has resulted in operational inefficiencies, overlapping mandates, and elevated overhead. We welcome the proposal to consolidate these functions under a single, unified body - as an important step toward streamlining treasury governance. The proposed council introduces a more agile, accountable, and strategically aligned framework with reduced bureaucracy.
Given the DAO’s substantial holdings across Real-World Assets (RWA) and DeFi, consolidating asset management is both logical and beneficial from a cost-efficiency and oversight standpoint. This move would centralize responsibility, enhance transparency, and provide the DAO with a singular point of contact for treasury operations.
The current fragmentation between the different committees has resulted in operational inefficiencies, overlapping mandates, and elevated overhead. We welcome the proposal to consolidate these functions under a single, unified body - as an important step toward streamlining treasury governance. The proposed council introduces a more agile, accountable, and strategically aligned framework with reduced bureaucracy.
Given the DAO’s substantial holdings across Real-World Assets (RWA) and DeFi, consolidating asset management is both logical and beneficial from a cost-efficiency and oversight standpoint. This move would centralize responsibility, enhance transparency, and provide the DAO with a singular point of contact for treasury operations.
That said, we would appreciate further detail on how the council plans to measure and report performance. Considering the scale of the treasury, implementing a real-time dashboard for visibility into asset allocations and key metrics would significantly improve transparency.
We strongly support a transparent and merit-based selection process for future service providers. Outsourcing specific responsibilities to qualified experts, while maintaining cost discipline, will ensure the DAO benefits from high-quality management with minimal operational overhead.
We had a chance to speak with the Entropy team, and this proposal looks like a cost-effective solution for the DAO. Right now, Entropy has enough resources to manage the program on their own. As the program grows, they plan to bring in more people. They also addressed our concerns about centralization. The nomination process for selecting the treasury provider will be public and transparent.
The following reflects the views of GMX’s Governance Committee, and is based on the combined research, evaluation, consensus, and ideation of various committee members.
First of all, thank you for this proposal. How the treasury management is handled has been a long and complex process for Arbitrum, which led to the formation of many different committees. Therefore, addressing and organizing this issue is very important. In particular, the fragmented treasury management structure can cause communication difficulties between committees, potentially leading to conflicts in decision-making and challenges in risk management. For this reason, the idea of unifying the scattered structure under a single umbrella is quite sensible. Additionally, the establishment of an oversight and coordination body — composed of representatives from AF and Offchain Labs — is one of the key factors that increases the proposal’s reliability and feasibility. We also believe it is critical for this oversight body to regularly share reports and serve in an advisory role. For all these reasons, we support the proposal.
ITU Governance, @harryvors
I will be voting for this proposal because it streamlines treasury oversight by replacing fragmented structures with a unified council. It reduces inefficiencies, improves coordination, and keeps the DAO in control, without adding extra cost. While centralization concerns exist, ongoing transparency and accountability will be key. Overall, it’s a smart, scalable upgrade for Arbitrum’s treasury management.
I will be voting for this proposal because it streamlines treasury oversight by replacing fragmented structures with a unified council. It reduces inefficiencies, improves coordination, and keeps the DAO in control, without adding extra cost. While centralization concerns exist, ongoing transparency and accountability will be key. Overall, it’s a smart, scalable upgrade for Arbitrum’s treasury management.
We're mostly on board with this proposal, with only a few comments.
In terms of the STEP II and TMC/GMC funds, nothing will change as it relates to the previously DAO-approved allocations. These are still in the process of being deployed by the AF, and an update will be posted to the forum regarding the status of these assets soon. In short, no allocations here will be changed prior to deployment, although they will be subject to reallocation over time as we collect data on their impact/performance.
We're mostly on board with this proposal, with only a few comments.
In terms of the STEP II and TMC/GMC funds, nothing will change as it relates to the previously DAO-approved allocations. These are still in the process of being deployed by the AF, and an update will be posted to the forum regarding the status of these assets soon. In short, no allocations here will be changed prior to deployment, although they will be subject to reallocation over time as we collect data on their impact/performance.
Entropy will be handling the asset allocation recommendations, which will require OAT approval in order to ensure checks and balances are in place. The risk monitoring component will likely be outsourced on a case-by-case basis to qualified SPs, dependent upon the goals the DAO approves in the treasury allocation proposal.
We would suggest considering letting Entropy still manage things as whole but bringing in SPs as advisors with lesser roles to help continue to manage the allocations that were started with the original TMC as well as the risk monitoring that was already mentioned. We don't think Entropy would do a bad job, but the team did suggest three members to handle this as part of the TMC in the first place, while acknowledging that they would fit better on the GMC side and as far as we're aware there hasn't been any large changes there. As Matt mentioned during the most recent Open Proposals call, Entropy did not yet have anyone on the team that was specialized in handling allocations and while we are confident they'll pick someone talented, that person could probably use some outside help as well.
Entropy will be taking on the role of reporting under this proposal. We will have live dashboards (ideally with a custom frontend rather than just living on Dune to increase the DAO’s professionalism) available to anyone for free to track treasury positions, and will also post quarterly reports with insights related to treasury performance/the DAO’s financial health.
We don't quite understand this answer in the context that it was replying to, is the quarterly reporting for all the initiatives? The monthly reporting done on STEP was mentioned specifically, which already has a dashboard built by Steakhouse. Entropy may rebuild this in a better way or with a different frontend but we don't see why that would mean reducing the reporting from monthly to quarterly. As I'm sure most people who have had jobs where they built dashboards are aware, there are a lot of users who will never go look at a dashboard but do still expect information synthesized for them, and we're not sure that changes across domains or with more training. We can see how quarterly might fit better for the TMC/GMC parts, but we don't see much of a reason why that couldn't also be monthly too.
Lastly, we want to note that as mentioned during the most recent treasury management call, this proposal assumes Entropy continues to function in its current capacity for the DAO going forward. We think that's a reasonable assumption but would not want this to go beyond a temp check until the other proposal is figured out or this one is changed such that another entity could step into Entropy's role.
We're mostly on board with this proposal, with only a few comments.
In terms of the STEP II and TMC/GMC funds, nothing will change as it relates to the previously DAO-approved allocations. These are still in the process of being deployed by the AF, and an update will be posted to the forum regarding the status of these assets soon. In short, no allocations here will be changed prior to deployment, although they will be subject to reallocation over time as we collect data on their impact/performance.
We're mostly on board with this proposal, with only a few comments.
In terms of the STEP II and TMC/GMC funds, nothing will change as it relates to the previously DAO-approved allocations. These are still in the process of being deployed by the AF, and an update will be posted to the forum regarding the status of these assets soon. In short, no allocations here will be changed prior to deployment, although they will be subject to reallocation over time as we collect data on their impact/performance.
Entropy will be handling the asset allocation recommendations, which will require OAT approval in order to ensure checks and balances are in place. The risk monitoring component will likely be outsourced on a case-by-case basis to qualified SPs, dependent upon the goals the DAO approves in the treasury allocation proposal.
We would suggest considering letting Entropy still manage things as whole but bringing in SPs as advisors with lesser roles to help continue to manage the allocations that were started with the original TMC as well as the risk monitoring that was already mentioned. We don't think Entropy would do a bad job, but the team did suggest three members to handle this as part of the TMC in the first place, while acknowledging that they would fit better on the GMC side and as far as we're aware there hasn't been any large changes there. As Matt mentioned during the most recent Open Proposals call, Entropy did not yet have anyone on the team that was specialized in handling allocations and while we are confident they'll pick someone talented, that person could probably use some outside help as well.
Entropy will be taking on the role of reporting under this proposal. We will have live dashboards (ideally with a custom frontend rather than just living on Dune to increase the DAO’s professionalism) available to anyone for free to track treasury positions, and will also post quarterly reports with insights related to treasury performance/the DAO’s financial health.
We don't quite understand this answer in the context that it was replying to, is the quarterly reporting for all the initiatives? The monthly reporting done on STEP was mentioned specifically, which already has a dashboard built by Steakhouse. Entropy may rebuild this in a better way or with a different frontend but we don't see why that would mean reducing the reporting from monthly to quarterly. As I'm sure most people who have had jobs where they built dashboards are aware, there are a lot of users who will never go look at a dashboard but do still expect information synthesized for them, and we're not sure that changes across domains or with more training. We can see how quarterly might fit better for the TMC/GMC parts, but we don't see much of a reason why that couldn't also be monthly too.
Lastly, we want to note that as mentioned during the most recent treasury management call, this proposal assumes Entropy continues to function in its current capacity for the DAO going forward. We think that's a reasonable assumption but would not want this to go beyond a temp check until the other proposal is figured out or this one is changed such that another entity could step into Entropy's role.
This proposal signals a significant maturation in how Arbitrum manages its treasury and I’m fully aligned with the direction.
Fragmentation across TMC, GMC, and STEP has long created inefficiencies, overlapping scopes, and excessive overhead. The proposed unified structure, the Arbitrum Treasury Management Council introduces a cohesive and agile framework with clear accountability, minimal bureaucracy, and strategic foresight.
This proposal signals a significant maturation in how Arbitrum manages its treasury and I’m fully aligned with the direction.
Fragmentation across TMC, GMC, and STEP has long created inefficiencies, overlapping scopes, and excessive overhead. The proposed unified structure, the Arbitrum Treasury Management Council introduces a cohesive and agile framework with clear accountability, minimal bureaucracy, and strategic foresight.
Why this makes sense:
My main takeaway: This proposal offers a streamlined, scalable, and DAO-aligned framework that keeps Arbitrum’s treasury nimble, secure, and yield-optimized, exactly what’s needed as the ecosystem grows.
Let’s evolve past operational sprawl and into a more coherent future. Full support.
This proposal signals a significant maturation in how Arbitrum manages its treasury and I’m fully aligned with the direction.
Fragmentation across TMC, GMC, and STEP has long created inefficiencies, overlapping scopes, and excessive overhead. The proposed unified structure, the Arbitrum Treasury Management Council introduces a cohesive and agile framework with clear accountability, minimal bureaucracy, and strategic foresight.
This proposal signals a significant maturation in how Arbitrum manages its treasury and I’m fully aligned with the direction.
Fragmentation across TMC, GMC, and STEP has long created inefficiencies, overlapping scopes, and excessive overhead. The proposed unified structure, the Arbitrum Treasury Management Council introduces a cohesive and agile framework with clear accountability, minimal bureaucracy, and strategic foresight.
Why this makes sense:
My main takeaway: This proposal offers a streamlined, scalable, and DAO-aligned framework that keeps Arbitrum’s treasury nimble, secure, and yield-optimized, exactly what’s needed as the ecosystem grows.
Let’s evolve past operational sprawl and into a more coherent future. Full support.
Consolidating TMC + GMC + STEP into a single Treasury Management Council (ATMC) should finally give us one holistic strategy instead of three disconnected play-books.
Oversight & Transparency (OAT) still retains final sign-off on allocations, which puts a real circuit-breaker between Entropy (as treasurer) and the funds.
We repurpose the unspent 1 M ARB from the old committees, saving the DAO another budget ask in the short term.
Consolidating TMC + GMC + STEP into a single Treasury Management Council (ATMC) should finally give us one holistic strategy instead of three disconnected play-books.
Oversight & Transparency (OAT) still retains final sign-off on allocations, which puts a real circuit-breaker between Entropy (as treasurer) and the funds.
We repurpose the unspent 1 M ARB from the old committees, saving the DAO another budget ask in the short term.
Entropy creates both the macro strategy and picks the service-providers that execute it. That’s efficient but also a classic single-point-of-failure.
OAT’s five members are great generalists, yet they may lack deep treasury or RWA expertise to vet Entropy’s calls.
Consider outlining a bit more about how you intend to select the service provider playbooks (timeline, open RFP vs. pre-vetted list, replacement rights). Knowing the guard-rails before funds move would reduce the centralization concern.
Consolidating TMC + GMC + STEP into a single Treasury Management Council (ATMC) should finally give us one holistic strategy instead of three disconnected play-books.
Oversight & Transparency (OAT) still retains final sign-off on allocations, which puts a real circuit-breaker between Entropy (as treasurer) and the funds.
We repurpose the unspent 1 M ARB from the old committees, saving the DAO another budget ask in the short term.
Consolidating TMC + GMC + STEP into a single Treasury Management Council (ATMC) should finally give us one holistic strategy instead of three disconnected play-books.
Oversight & Transparency (OAT) still retains final sign-off on allocations, which puts a real circuit-breaker between Entropy (as treasurer) and the funds.
We repurpose the unspent 1 M ARB from the old committees, saving the DAO another budget ask in the short term.
Entropy creates both the macro strategy and picks the service-providers that execute it. That’s efficient but also a classic single-point-of-failure.
OAT’s five members are great generalists, yet they may lack deep treasury or RWA expertise to vet Entropy’s calls.
Consider outlining a bit more about how you intend to select the service provider playbooks (timeline, open RFP vs. pre-vetted list, replacement rights). Knowing the guard-rails before funds move would reduce the centralization concern.
This proposal is a great example of why Entropy Advisors is a important(almost crucial) entity that the Arbitrum DAO needs, these inefficiencies are most likely spotted by other delegates, but most do not have time/incentives or an action plan on how to address them.
Merging 3 fragmented committees into one 1 seems like the logical decision, we all know DAOs are the wrong type of attractor and they usually have to make 2 many mistakes before executing correctly, in this case the overhead seems to equal the yield generated thus making this whole effort redundant for the DAO imo in the present.
This proposal is a great example of why Entropy Advisors is a important(almost crucial) entity that the Arbitrum DAO needs, these inefficiencies are most likely spotted by other delegates, but most do not have time/incentives or an action plan on how to address them.
Merging 3 fragmented committees into one 1 seems like the logical decision, we all know DAOs are the wrong type of attractor and they usually have to make 2 many mistakes before executing correctly, in this case the overhead seems to equal the yield generated thus making this whole effort redundant for the DAO imo in the present.
Will be voting FOR this proposal. My only questions are why has this not been done earlier(I apologize if I'm missing some context on why this decision was made now) and how can we ensure we eliminate this type of overhead in the future in due time?
I have in favour of this proposal. Makes sense to consolidate TMC GMC and STEMP cs., not only for operation efficiency but for better general coordination. Hopefully it will also have a positive impact on accountability, with increased complexity it's more difficult to keep track and thus information can be easily be lost or overlooked. Voted FOR.
Voting in favor, this proposal has my full support. Fragmented committees always lead to inefficiencies and unclear responsibilities, so consolidating treasury management within a unified structure is a smart move. Plus the fact that it comes with no additional expenses makes the proposal even more reasonable
After consideration, the @SEEDgov delegation decided to vote FOR (Adopt the Arbitrum Treasury Management Council) on this proposal at the Snapshot Vote.
After consideration, the @SEEDgov delegation decided to vote FOR (Adopt the Arbitrum Treasury Management Council) on this proposal at the Snapshot Vote.
In alignment with what we stated in our rationale for the reallocation of USDM funds proposal we believe that the proposed framework to adjust prior asset allocations makes a lot of sense especially considering that the OAT would be involved
As for allocating new assets from the treasury, we recognize that revenue inflows are increasing from multiple sources (e.g., Timeboost, Sequencer fees). Given this, a more streamlined and efficient process is needed to prevent these funds from sitting idle and to ensure capital is put to work effectively.
Overall, we’re aligned with the intentions of this proposal and support consolidating efforts under a unified structure. It’s a logical next step in the DAO’s financial evolution.
Lastly, while we’re not fully aware of Entropy’s administrative costs for managing this process, we agree with the general sentiment that the layered cost structures of previous programs (TMC, GMC, STEP1, STEP2, etc.) were excessive and unsustainable.
voting For on the current offchain vote because this will bring more accountability and less overhead.
I will be voting "For" this proposal to consolidate councils.
In general, it just makes sense to do this. Cost alone is severely eating into yield (looks like the project is barely breaking even)... and while I know there are non-yield related reasons to do these things, its important to be reasonable where possible.
I will be voting "For" this proposal to consolidate councils.
In general, it just makes sense to do this. Cost alone is severely eating into yield (looks like the project is barely breaking even)... and while I know there are non-yield related reasons to do these things, its important to be reasonable where possible.
I also think this type of org structure is inefficient on multiple levels. Council's having to coordinate with other councils on decisions that affect the larger goal, applicants who have to navigate 3 separate committees, and DAO Delegates who don't have a singular source to contact with any treasury management issues
Support doing this for the treasury management councils, and would recommend that if there are other similiar issues happening either now or in the future, to address in the same manner.
Entropy recognizes, as the author of the Arbitrum Treasury Management Council - Consolidating Efforts, that a conflict of interest exists given our position on the proposed council. We are disclosing this conflict before voting FOR the consolidation on Snapshot.
As in @web3citizenxyz representation, voting FOR. Below the rationale:
The following reflects the views of L2BEAT’s governance team, composed of @krst, @Sinkas, and @Manugotsuka, and it’s based on their combined research, fact-checking, and ideation.
We are voting FOR the proposal.
The following reflects the views of L2BEAT’s governance team, composed of @krst, @Sinkas, and @Manugotsuka, and it’s based on their combined research, fact-checking, and ideation.
We are voting FOR the proposal.
We believe that combining the TMC, GMC, and STEP committees into a single Treasury Management Council makes sense. Running three parallel groups has provided the DAO with helpful experiments, but it has also scattered accountability, slowed decision-making, and incurred nearly six figures in committee overhead. Most importantly, each initiative has been operating in isolation, with this disconnectedness also being evident in decision-making.
Consolidating those mandates under one execution team (Entropy) with an external voting body (OAT) and a clear communication channel (OpCo in the future) has the potential to make operations leaner and the execution of strategies more coordinated.
I’m voting yes
We’ve tried the multi-committee setup and it clearly doesn’t scale. Everyone’s been improvising around it anyway
This structure reflects how things are mostly already working, but with clearer lines and less coordination/bureaucracy.
What matters is that strategy becomes coherent and the DAO stays in the loop without blocking every move.
We vote for this proposal.
We favor this consolidation because running parallel initiatives for the same goal has proven inefficient and confusing. Combining those tracks into one council focuses governance on outcomes, not committee scheduling, and lets Entropy Advisors integrate treasury moves with broader growth initiatives. While we still have several minor questions on execution mechanics, placing Entropy Advisors at the center should align every allocation with the DAO’s strategic roadmap rather than siloed objectives. The built-in three-of-five OAT check and Snapshot claw-back keep power balanced, so we are comfortable supporting the change.
I will be voting FOR on Snapshot due the more streamlined approach that will inevitably benefit the DAO long term. Adding the fact that this comes at no extra cost makes it easier to support the change as, in spite of some concerns voiced by other, it is a net win.
I voted FOR on this proposal. This consolidation will be beneficial for the DAO.
The following reflects the views of the Lampros DAO governance team, composed of Chain_L (@Blueweb) and @Euphoria, based on our combined research, analysis, and ideation.
We are voting FOR this proposal in the Snapshot voting.
The following reflects the views of the Lampros DAO governance team, composed of Chain_L (@Blueweb) and @Euphoria, based on our combined research, analysis, and ideation.
We are voting FOR this proposal in the Snapshot voting.
We believe merging the TMC, GMC, and STEP into one council is the right move for Arbitrum’s treasury. We believe this new Council design addresses many of the pain points that arose under TMC, GMC, and STEP. It’s encouraging to see that leftover funds will be used smartly for specialist help where needed, without creating new salaries.
That said, while we support the direction, we want to share some thoughts:
while the proposed structure does position OAT as a final reviewer for decisions made by the Council, this is meant to function more as a governance backstop rather than a body actively driving asset allocation decisions.
We see this point and agree with what others like @bertani mentioned, the OAT was not originally designed for financial oversight. Over time, it may make sense for the Council to help the OAT develop stronger treasury literacy or bring in a neutral advisor for more technical allocation checks.
the DAO will approve the goals of each treasury allocation prior to moving funds
We appreciate this clarity and also agree with @Camelot that balancing yield and growth is always a tricky dance. It would be helpful if the Council could share, maybe in future budget requests, a simple rubric that explains when we intentionally lean more toward ecosystem growth vs strict APR targets.
Entropy will be taking on the role of reporting under this proposal. We will have live dashboards (ideally with a custom frontend
We like the move away from just Dune dashboards. A question: could we have a clear service level for this? For example, that major treasury movements get reflected within 24 hours, and quarterly reports come out within 15 days after each quarter ends. This sets shared expectations for everyone.
We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism
We echo this too. It’s good to see the plan to post rationales for SP choices. One practical idea: maybe an open shortlisting or lightweight RFP for big vendor hires could build trust, without adding too much friction.
If a decision turns out to be flawed or controversial, the only way to undo it is through a full council disbandment.
This works as a hard backstop, but it might help the DAO if we also had a softer option. For example, if there’s a major reallocation, say 10% of AUM or more, perhaps the Council could post it and allow a 5-day comment window before execution.
Finally, we want to echo what @Jose_StableLab suggested, a short post-mortem covering lessons learned from TMC, GMC, and STEP would be really valuable. It would help new contributors understand which parts worked and which bottlenecks to avoid as we shift to this single council.
Overall, we see this as an overdue cleanup that gives the DAO more cohesion and clearer checks than what we had before.
We’re supporting this proposal because it simplifies and strengthens how the Arbitrum DAO manages its treasury. Right now, things are too fragmented across multiple committees, making it hard to coordinate and execute effectively. This new structure brings everything under one unified council, cuts unnecessary overhead, and clearly defines who’s responsible for what, without adding extra costs. It keeps the DAO in control while making the whole process more efficient, transparent, and better aligned with Arbitrum’s long-term goals. It’s a smart step forward.
I am voting For this proposal. As I previously mentioned, Treasury Management should be overseen by a single entity with a comprehensive view of the DAO’s portfolio. I also believe this presents a valuable opportunity for Arbitrum to demonstrate Ethereum alignment by supporting LRT with minority clients or native Arbitrum DeFi protocols.
However, regarding Service Providers, I would like more details on the selection process. Additionally, the budget already approved for TMC/GMC STEP may exceed what is necessary for these Service Providers. I hope there will be clear accountability and transparency on these two points.
gm, voting in favor as some of the previous concerns have been reasonably addressed by Entropy.
The flow DAO goals --> Entropy <-- OAT makes sense.
gm, voting in favor as some of the previous concerns have been reasonably addressed by Entropy.
The flow DAO goals --> Entropy <-- OAT makes sense.
the DAO will approve the goals of each treasury allocation prior to moving funds to the AF and its subsequent deployment in line with recommendations from Entropy that are finally approved by the OAT. The OAT’s primary role is ensuring that the allocation recommendations are in-line with what the DAO approved. We agree with these 4 treasury goals.
Happy to support Entropy and the new structure in their active treasurer role.
This proposal is a great example of why Entropy Advisors is a important(almost crucial) entity that the Arbitrum DAO needs, these inefficiencies are most likely spotted by other delegates, but most do not have time/incentives or an action plan on how to address them.
Merging 3 fragmented committees into one 1 seems like the logical decision, we all know DAOs are the wrong type of attractor and they usually have to make 2 many mistakes before executing correctly, in this case the overhead seems to equal the yield generated thus making this whole effort redundant for the DAO imo in the present.
This proposal is a great example of why Entropy Advisors is a important(almost crucial) entity that the Arbitrum DAO needs, these inefficiencies are most likely spotted by other delegates, but most do not have time/incentives or an action plan on how to address them.
Merging 3 fragmented committees into one 1 seems like the logical decision, we all know DAOs are the wrong type of attractor and they usually have to make 2 many mistakes before executing correctly, in this case the overhead seems to equal the yield generated thus making this whole effort redundant for the DAO imo in the present.
Will be voting FOR this proposal. My only questions are why has this not been done earlier(I apologize if I'm missing some context on why this decision was made now) and how can we ensure we eliminate this type of overhead in the future in due time?
I have in favour of this proposal. Makes sense to consolidate TMC GMC and STEMP cs., not only for operation efficiency but for better general coordination. Hopefully it will also have a positive impact on accountability, with increased complexity it's more difficult to keep track and thus information can be easily be lost or overlooked. Voted FOR.
Voting in favor, this proposal has my full support. Fragmented committees always lead to inefficiencies and unclear responsibilities, so consolidating treasury management within a unified structure is a smart move. Plus the fact that it comes with no additional expenses makes the proposal even more reasonable
After consideration, the @SEEDgov delegation decided to vote FOR (Adopt the Arbitrum Treasury Management Council) on this proposal at the Snapshot Vote.
After consideration, the @SEEDgov delegation decided to vote FOR (Adopt the Arbitrum Treasury Management Council) on this proposal at the Snapshot Vote.
In alignment with what we stated in our rationale for the reallocation of USDM funds proposal we believe that the proposed framework to adjust prior asset allocations makes a lot of sense especially considering that the OAT would be involved
As for allocating new assets from the treasury, we recognize that revenue inflows are increasing from multiple sources (e.g., Timeboost, Sequencer fees). Given this, a more streamlined and efficient process is needed to prevent these funds from sitting idle and to ensure capital is put to work effectively.
Overall, we’re aligned with the intentions of this proposal and support consolidating efforts under a unified structure. It’s a logical next step in the DAO’s financial evolution.
Lastly, while we’re not fully aware of Entropy’s administrative costs for managing this process, we agree with the general sentiment that the layered cost structures of previous programs (TMC, GMC, STEP1, STEP2, etc.) were excessive and unsustainable.
voting For on the current offchain vote because this will bring more accountability and less overhead.
I will be voting "For" this proposal to consolidate councils.
In general, it just makes sense to do this. Cost alone is severely eating into yield (looks like the project is barely breaking even)... and while I know there are non-yield related reasons to do these things, its important to be reasonable where possible.
I will be voting "For" this proposal to consolidate councils.
In general, it just makes sense to do this. Cost alone is severely eating into yield (looks like the project is barely breaking even)... and while I know there are non-yield related reasons to do these things, its important to be reasonable where possible.
I also think this type of org structure is inefficient on multiple levels. Council's having to coordinate with other councils on decisions that affect the larger goal, applicants who have to navigate 3 separate committees, and DAO Delegates who don't have a singular source to contact with any treasury management issues
Support doing this for the treasury management councils, and would recommend that if there are other similiar issues happening either now or in the future, to address in the same manner.
Entropy recognizes, as the author of the Arbitrum Treasury Management Council - Consolidating Efforts, that a conflict of interest exists given our position on the proposed council. We are disclosing this conflict before voting FOR the consolidation on Snapshot.
As in @web3citizenxyz representation, voting FOR. Below the rationale:
The following reflects the views of L2BEAT’s governance team, composed of @krst, @Sinkas, and @Manugotsuka, and it’s based on their combined research, fact-checking, and ideation.
We are voting FOR the proposal.
The following reflects the views of L2BEAT’s governance team, composed of @krst, @Sinkas, and @Manugotsuka, and it’s based on their combined research, fact-checking, and ideation.
We are voting FOR the proposal.
We believe that combining the TMC, GMC, and STEP committees into a single Treasury Management Council makes sense. Running three parallel groups has provided the DAO with helpful experiments, but it has also scattered accountability, slowed decision-making, and incurred nearly six figures in committee overhead. Most importantly, each initiative has been operating in isolation, with this disconnectedness also being evident in decision-making.
Consolidating those mandates under one execution team (Entropy) with an external voting body (OAT) and a clear communication channel (OpCo in the future) has the potential to make operations leaner and the execution of strategies more coordinated.
I’m voting yes
We’ve tried the multi-committee setup and it clearly doesn’t scale. Everyone’s been improvising around it anyway
This structure reflects how things are mostly already working, but with clearer lines and less coordination/bureaucracy.
What matters is that strategy becomes coherent and the DAO stays in the loop without blocking every move.
We vote for this proposal.
We favor this consolidation because running parallel initiatives for the same goal has proven inefficient and confusing. Combining those tracks into one council focuses governance on outcomes, not committee scheduling, and lets Entropy Advisors integrate treasury moves with broader growth initiatives. While we still have several minor questions on execution mechanics, placing Entropy Advisors at the center should align every allocation with the DAO’s strategic roadmap rather than siloed objectives. The built-in three-of-five OAT check and Snapshot claw-back keep power balanced, so we are comfortable supporting the change.
I will be voting FOR on Snapshot due the more streamlined approach that will inevitably benefit the DAO long term. Adding the fact that this comes at no extra cost makes it easier to support the change as, in spite of some concerns voiced by other, it is a net win.
I voted FOR on this proposal. This consolidation will be beneficial for the DAO.
The following reflects the views of the Lampros DAO governance team, composed of Chain_L (@Blueweb) and @Euphoria, based on our combined research, analysis, and ideation.
We are voting FOR this proposal in the Snapshot voting.
The following reflects the views of the Lampros DAO governance team, composed of Chain_L (@Blueweb) and @Euphoria, based on our combined research, analysis, and ideation.
We are voting FOR this proposal in the Snapshot voting.
We believe merging the TMC, GMC, and STEP into one council is the right move for Arbitrum’s treasury. We believe this new Council design addresses many of the pain points that arose under TMC, GMC, and STEP. It’s encouraging to see that leftover funds will be used smartly for specialist help where needed, without creating new salaries.
That said, while we support the direction, we want to share some thoughts:
while the proposed structure does position OAT as a final reviewer for decisions made by the Council, this is meant to function more as a governance backstop rather than a body actively driving asset allocation decisions.
We see this point and agree with what others like @bertani mentioned, the OAT was not originally designed for financial oversight. Over time, it may make sense for the Council to help the OAT develop stronger treasury literacy or bring in a neutral advisor for more technical allocation checks.
the DAO will approve the goals of each treasury allocation prior to moving funds
We appreciate this clarity and also agree with @Camelot that balancing yield and growth is always a tricky dance. It would be helpful if the Council could share, maybe in future budget requests, a simple rubric that explains when we intentionally lean more toward ecosystem growth vs strict APR targets.
Entropy will be taking on the role of reporting under this proposal. We will have live dashboards (ideally with a custom frontend
We like the move away from just Dune dashboards. A question: could we have a clear service level for this? For example, that major treasury movements get reflected within 24 hours, and quarterly reports come out within 15 days after each quarter ends. This sets shared expectations for everyone.
We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism
We echo this too. It’s good to see the plan to post rationales for SP choices. One practical idea: maybe an open shortlisting or lightweight RFP for big vendor hires could build trust, without adding too much friction.
If a decision turns out to be flawed or controversial, the only way to undo it is through a full council disbandment.
This works as a hard backstop, but it might help the DAO if we also had a softer option. For example, if there’s a major reallocation, say 10% of AUM or more, perhaps the Council could post it and allow a 5-day comment window before execution.
Finally, we want to echo what @Jose_StableLab suggested, a short post-mortem covering lessons learned from TMC, GMC, and STEP would be really valuable. It would help new contributors understand which parts worked and which bottlenecks to avoid as we shift to this single council.
Overall, we see this as an overdue cleanup that gives the DAO more cohesion and clearer checks than what we had before.
We’re supporting this proposal because it simplifies and strengthens how the Arbitrum DAO manages its treasury. Right now, things are too fragmented across multiple committees, making it hard to coordinate and execute effectively. This new structure brings everything under one unified council, cuts unnecessary overhead, and clearly defines who’s responsible for what, without adding extra costs. It keeps the DAO in control while making the whole process more efficient, transparent, and better aligned with Arbitrum’s long-term goals. It’s a smart step forward.
I am voting For this proposal. As I previously mentioned, Treasury Management should be overseen by a single entity with a comprehensive view of the DAO’s portfolio. I also believe this presents a valuable opportunity for Arbitrum to demonstrate Ethereum alignment by supporting LRT with minority clients or native Arbitrum DeFi protocols.
However, regarding Service Providers, I would like more details on the selection process. Additionally, the budget already approved for TMC/GMC STEP may exceed what is necessary for these Service Providers. I hope there will be clear accountability and transparency on these two points.
gm, voting in favor as some of the previous concerns have been reasonably addressed by Entropy.
The flow DAO goals --> Entropy <-- OAT makes sense.
gm, voting in favor as some of the previous concerns have been reasonably addressed by Entropy.
The flow DAO goals --> Entropy <-- OAT makes sense.
the DAO will approve the goals of each treasury allocation prior to moving funds to the AF and its subsequent deployment in line with recommendations from Entropy that are finally approved by the OAT. The OAT’s primary role is ensuring that the allocation recommendations are in-line with what the DAO approved. We agree with these 4 treasury goals.
Happy to support Entropy and the new structure in their active treasurer role.
I’m voting yes
We’ve tried the multi-committee setup and it clearly doesn’t scale. Everyone’s been improvising around it anyway
This structure reflects how things are mostly already working, but with clearer lines and less coordination/bureaucracy.
What matters is that strategy becomes coherent and the DAO stays in the loop without blocking every move.
Looks like a step toward treating treasury management as a long-term craft instead of a rotating experiment.
Voting in FAVOUR
As someone who suffered deeply the issues that the previous design had and had to jump through too many hoops just to continue doing a program already approved, this proposal is a welcome improvement.
I second Camelot point about how adding more responsibilities to OCL, Entropy, and the AF means further accountability is needed.
Voting in FAVOUR
As someone who suffered deeply the issues that the previous design had and had to jump through too many hoops just to continue doing a program already approved, this proposal is a welcome improvement.
I second Camelot point about how adding more responsibilities to OCL, Entropy, and the AF means further accountability is needed.
Without additional transparency from AF and alignment from Entropy (see Tanara's recommendation for Entropy's renewal), I'm genuinely concerned we're moving into an unsound governance structure that will look bad as the space matures and more analysts assess the soundness of Arbitrum as an investment (institutions) and infrastructure (enterprise). Good governance is a nice-to-have when we're dealing with degens, but the pressure will increase from now on if Arbitrum is to become key infrastructure for enterprises and a sound investment asset for institutions.
I voted FOR this proposal
I support the general goal of the proposal - to streamline Arbitrum DAO’s treasury management and reduce fragmentation. However, I would like to highlight several key risks that should be addressed as part of future on-chain implementation.
I see several key risks here:
I voted FOR this proposal
I support the general goal of the proposal - to streamline Arbitrum DAO’s treasury management and reduce fragmentation. However, I would like to highlight several key risks that should be addressed as part of future on-chain implementation.
I see several key risks here:
What I suggest to improve this ATMC:
All these suggestions and risks were raised to ensure that Arbitrum can be confident about its future. This doesn’t mean that Entropy is doing a poor job or that I find their work unsatisfactory - on the contrary, their work has greatly benefited Arbitrum. However, they are a private company with their own financial interests, while Arbitrum must prioritize its own interests and have the ability to protect them when necessary
Consolidation makes sense. There are too many parties involved in managing the DAO treasury for it to operate efficiently. The current fragmented structure clearly isn't working.
However this change would give Entropy considerable control over the treasury (even with veto oversight from OAT). It's the basic tradeoff between decentralization. We understand that Entropy is a trusted party in the Arbitrum ecosystem and they appear to have the skills and capabilities to effectively manage the treasury, or at least do a better job than the previously fragmented approach.
Consolidation makes sense. There are too many parties involved in managing the DAO treasury for it to operate efficiently. The current fragmented structure clearly isn't working.
However this change would give Entropy considerable control over the treasury (even with veto oversight from OAT). It's the basic tradeoff between decentralization. We understand that Entropy is a trusted party in the Arbitrum ecosystem and they appear to have the skills and capabilities to effectively manage the treasury, or at least do a better job than the previously fragmented approach.
But we think it's important to regularly evaluate whether Entropy remains the best entity for this role long-term. Without periodic reassessment the DAO risks capture and excessive centralization. The 3% disbandment threshold is high but necessary as a backstop. Though the burden of proposing alternatives could deter legitimate challenges to underperformance.
Overall FranklinDAO is supportive of the consolidation, but we want to ensure the DAO maintains meaningful oversight mechanisms and doesn't become overly dependent on any single service provider, including Entropy.
First, thank you to everyone who has taken the time to comment/provide feedback on this proposal, and for those who have attended the open governance calls related to treasury management to go over this proposal live. We would like to address some of the comments
First, thank you to everyone who has taken the time to comment/provide feedback on this proposal, and for those who have attended the open governance calls related to treasury management to go over this proposal live. We would like to address some of the comments
While the OAT members are no doubt highly capable, respected contributors to the Arbitrum ecosystem, it’s important to highlight that the OAT was created to guarantee Oversight and Transparency over OpCo. The role description for OAT members did not explicitly include responsibilities related to financial oversight or asset management. Financial qualifications such as Corporate Finance, Capital Allocation, and Financial & Risk Management were listed only as “desired,” not as required. As a result, none of the currently elected OAT members appear to have a professional background in finance or capital allocation.
Given the significance of the DAO’s treasury and the complexity of managing digital assets at scale, I think it’s worth asking:
We have already spoken with all of the OAT members individually prior to posting this proposal to ensure their buy-in on the role described within the proposal.
To clarify: while the proposed structure does position OAT as a final reviewer for decisions made by the Council, this is meant to function more as a governance backstop rather than a body actively driving asset allocation decisions. The day-to-day financial strategy and execution will fall on Entropy and third-party SPs, as well as the AF for operational related tasks.
How many additional hours (weekly/monthly) are expected to be allocated to treasury management across Entropy, OpCo, AF, and OAT under this structure?
Are these teams currently close to capacity under their existing mandates?
What contingency planning exists for scaling headcount or adding budget once bandwidth constraints emerge?
Could resourcing gaps lead to bottlenecks elsewhere (e.g. protocol BD, program execution, or operational oversight)?
This is likely to be a large lift in terms of hours required by Entropy and the OpCo, but very minimal hours required of the OAT, OCL, and to some extent, the AF (whose role will likely shift over to OpCo over time).
The proposal repurposes the budget that was previously approved by the DAO to pay GMC and TMC members to hire third-party SPs that can help execute on tasks that members of the Arbitrum Treasury Management Council do not possess. Additionally, each time the council goes to the DAO with a new proposal seeking funds from the treasury to allocate, it can carve out a portion of the budget for outsourcing certain tasks to SPs, depending upon the goals of the allocation. We are not concerned with resource constraints for these reasons.
Regarding the funds already deployed:
I don’t see any mention of monthly reports like the ones done for STEP I. Who would be in charge of that for the other initiatives and for STEP I after the current funding ends in September?
The DAO voted for specific allocations for STEP II and TMC & GMC. If there is anything that has not already been deployed, will it be changed before the initial allocation? While I like the idea of Entropy eventually optimising the portfolio, I believe this should be done AFTER the initial deployment. Can you clarify this point?
Entropy will be taking on the role of reporting under this proposal. We will have live dashboards (ideally with a custom frontend rather than just living on Dune to increase the DAO’s professionalism) available to anyone for free to track treasury positions, and will also post quarterly reports with insights related to treasury performance/the DAO’s financial health. We also hope to host regularly cadenced calls to go over these dashboards for the community to ask questions/learn how to leverage the insights.
In terms of the STEP II and TMC/GMC funds, nothing will change as it relates to the previously DAO-approved allocations. These are still in the process of being deployed by the AF, and an update will be posted to the forum regarding the status of these assets soon. In short, no allocations here will be changed prior to deployment, although they will be subject to reallocation over time as we collect data on their impact/performance.
1. How Service Providers Are Chosen:
We fully agree with @Tane’s concern around the selection of external service providers.
However, we have important concerns regarding the process by which these service providers will be selected. Since detailed asset allocation and risk management expertise will no longer reside directly within the council, the selection process for external providers becomes even more critical. We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism. Specifically, we recommend implementing procedures that involve the DAO directly, such as comparative evaluations or collective deliberation on multiple provider proposals. This level of transparency and accountability is essential to mitigate potential conflicts of interest, favoritism, or any perception of preferential treatment toward closely associated projects or parties.
Since the council won’t directly handle asset allocation and risk directly, who we bring in to manage those functions becomes even more important. There absolutely needs to be transparency around how service providers are selected but we don’t think it makes sense for Entropy to be the one defining those best practices.
A more neutral and structured approach would be for a group like the ADPC to oversee initial vendor engagement and negotiation. They could help standardize the selection process, run comparisons across providers, and ensure decisions are made in a way that’s fair and open. That kind of separation would go a long way in building trust and avoiding any perception of bias.
2. Defining KPIs and Performance Expectations:
With the creation of this new council, we’re effectively watching one of the first real tests of role separation between AAEs play out. That makes it even more important to clearly define how coordination will work between Entropy and the DAO, and what role OpCo will play in ensuring accountability.
At the moment, there are no concrete KPIs, reporting timelines, or clarity around how performance will be evaluated. We’d like to see a framework that outlines when and how updates are shared, what success looks like, and what mechanisms the DAO has to step in whether that’s through feedback, defunding, or replacing underperforming contributors. Without those checks and balances in place, we risk entrenching roles without recourse if expectations aren’t met.
3. Limited Options for Dispute Resolution:
If a decision turns out to be flawed or controversial, the only way to undo it is through a full council disbandment.
It would be helpful to have some middle-ground options like a review mechanism, lightweight dispute process, or a way for delegates to raise concerns and prompt re-evaluation without needing to burn the whole thing down.
We’re aligned with the general direction of the proposal and appreciate the work that went into it.
Entropy will be handling the asset allocation recommendations, which will require OAT approval in order to ensure checks and balances are in place. The risk monitoring component will likely be outsourced on a case-by-case basis to qualified SPs, dependent upon the goals the DAO approves in the treasury allocation proposal. In terms of the process of procuring these SPs, Entropy will be leveraging its network to contract the best talent at the fairest price on behalf of the DAO, and the OpCo will be posting communications/rationale for vender selection on the forum to ensure transparency.
In terms of reporting timelines, this information is in the proposal and answered above.
In terms of KPIs, this will be defined in the proposals to the DAO that seek treasury allocations, which then go through the normal voting process. The DAO will essentially approve each allocation's goals, and the success of the council should be measured based on how well it accomplishes these goals. This is another reason the OAT made sense as the approval body, as it serves as a check on recommendations made by Entropy that the allocations do in fact align with the DAO’s desires.
In terms of disputes, the proposal was recently modified to enable the OAT to make emergency actions, and the DAO has the ability to refute/reverse/clawback any allocation via Snapshot (Defined in the proposal).
The treasury has four objectives IMO:
Generate yield so the DAO is self-sustaining. This is the core of the Entropy plan and matches the focus of previous committees.
Grow the DAO’s real-world-asset exposure and diversify risk.
Support established Arbitrum protocols.
Bootstrap liquidity for new Arbitrum projects. Early liquidity means other users feel confident to deposit funds, and all the DeFi flywheels that protocols enable can actually work.
One million dollars spread across nascent protocols is probably far more valuable than the same sum parked in T-bills.
This is distinct from the DRIP incentives proposal; here I am speaking about direct liquidity provision, for example:
• The DAO provides backstop liquidity to tokenised houses from Estate Protocol at a predefined floor to anchor prices.
• $200k of liquidity is supplied to a new perpetual exchange to compress funding costs.
• $500k is lent to solver pools so intents can settle promptly (RIP Chain Abstraction Proposal :face_exhaling:).
The Treasury Management Council should publish its intended allocation split for the year and retain discretion to redeploy capital quickly into high-impact liquidity pools.
Under the proposed structure, the DAO will approve the goals of each treasury allocation prior to moving funds to the AF and its subsequent deployment in line with recommendations from Entropy that are finally approved by the OAT. The OAT’s primary role is ensuring that the allocation recommendations are in-line with what the DAO approved. We agree with these 4 treasury goals.
In terms of the allocation split, we will attempt to establish a high-level target allocation structure in tandem with our budget creation process.
gm, I am generally aligned and this sums up my view.
gm, I am generally aligned and this sums up my view.
has clearly led to inefficiencies and misalignment among treasury strategies.
Inefficiencies are clear. Could you outline the misalignments you’ve observed so the DAO and the new Treasury Committee can address them?
TMC to maintain a live dashboard or periodic public reporting portal, providing real-time or near-real-time visibility into treasury allocation, deployment status, and performance metrics.
This is a great call and I think it should be added into the requirements. It's much more effective than a static report, and I'm sure Entropy's data team can craft a useful interface.
Camelot believes there is significant margin to create yield strategies for the DAO with well-balanced risk through the utilization of Arbitrum protocols, so that we realize both revenue for the DAO and growth of the ecosystem. We think this point should be of primary importance in the initiative. There is even more merit to this approach because Entropy is positioned to manage the DRIP initiative if that vote passes. While the initiatives are totally different, from a practical standpoint Entropy would then be able to manage both incentive assets and treasury assets.
Would it be possible to describe how the allocation strategy will look? For example, will the AUM be divided into several sub-portfolios (e.g., stablecoins, ETH, RWAs) to diversify risk and align with the previous mandates of STEP, TMC, and GMC, or will you pursue a single, unified portfolio approach?
I want to emphasise the points raised by Camelot, JoJo and TID.
The treasury has four objectives IMO:
Generate yield so the DAO is self-sustaining. This is the core of the Entropy plan and matches the focus of previous committees.
Grow the DAO’s real-world-asset exposure and diversify risk.
Support established Arbitrum protocols.
Bootstrap liquidity for new Arbitrum projects. Early liquidity means other users feel confident to deposit funds, and all the DeFi flywheels that protocols enable can actually work. One million dollars spread across nascent protocols is probably far more valuable than the same sum parked in T-bills.
This is distinct from the DRIP incentives proposal; here I am speaking about direct liquidity provision, for example: • The DAO provides backstop liquidity to tokenised houses from Estate Protocol at a predefined floor to anchor prices. • $200k of liquidity is supplied to a new perpetual exchange to compress funding costs. • $500k is lent to solver pools so intents can settle promptly (RIP Chain Abstraction Proposal :face_exhaling:).
The Treasury Management Council should publish its intended allocation split for the year and retain discretion to redeploy capital quickly into high-impact liquidity pools.
We’re supportive of consolidating the different treasury committees into a single council. The current structure is fragmented and hard to coordinate. Bringing everything under one roof makes sense and should help the DAO operate more efficiently.
That said, there are a few areas we think need more attention:
1. How Service Providers Are Chosen:
We’re supportive of consolidating the different treasury committees into a single council. The current structure is fragmented and hard to coordinate. Bringing everything under one roof makes sense and should help the DAO operate more efficiently.
That said, there are a few areas we think need more attention:
1. How Service Providers Are Chosen:
We fully agree with @Tane’s concern around the selection of external service providers.
However, we have important concerns regarding the process by which these service providers will be selected. Since detailed asset allocation and risk management expertise will no longer reside directly within the council, the selection process for external providers becomes even more critical. We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism. Specifically, we recommend implementing procedures that involve the DAO directly, such as comparative evaluations or collective deliberation on multiple provider proposals. This level of transparency and accountability is essential to mitigate potential conflicts of interest, favoritism, or any perception of preferential treatment toward closely associated projects or parties.
Since the council won’t directly handle asset allocation and risk directly, who we bring in to manage those functions becomes even more important. There absolutely needs to be transparency around how service providers are selected but we don’t think it makes sense for Entropy to be the one defining those best practices.
A more neutral and structured approach would be for a group like the ADPC to oversee initial vendor engagement and negotiation. They could help standardize the selection process, run comparisons across providers, and ensure decisions are made in a way that’s fair and open. That kind of separation would go a long way in building trust and avoiding any perception of bias.
2. Defining KPIs and Performance Expectations:
With the creation of this new council, we’re effectively watching one of the first real tests of role separation between AAEs play out. That makes it even more important to clearly define how coordination will work between Entropy and the DAO, and what role OpCo will play in ensuring accountability.
At the moment, there are no concrete KPIs, reporting timelines, or clarity around how performance will be evaluated. We’d like to see a framework that outlines when and how updates are shared, what success looks like, and what mechanisms the DAO has to step in whether that’s through feedback, defunding, or replacing underperforming contributors. Without those checks and balances in place, we risk entrenching roles without recourse if expectations aren’t met.
3. Limited Options for Dispute Resolution:
If a decision turns out to be flawed or controversial, the only way to undo it is through a full council disbandment.
It would be helpful to have some middle-ground options like a review mechanism, lightweight dispute process, or a way for delegates to raise concerns and prompt re-evaluation without needing to burn the whole thing down.
We’re aligned with the general direction of the proposal and appreciate the work that went into it.
I'm voting yes because this proposal makes things more organized. Right now, there are too many separate groups handling the treasury, and it's confusing and costly. This new setup brings everything under one council, which should make it easier to manage funds and make smarter decisions for the DAO.
On June 16th, we made the following changes to this proposal before we hopefully proceed to Snapshot on June 19th:
On June 16th, we made the following changes to this proposal before we hopefully proceed to Snapshot on June 19th:
We will be covering these changes on the DAO's Open Discussions of Proposals call tomorrow, June 17th at 12pm ET.
AranaDigital supports the creation of the unified Arbitrum Treasury Management Council because merging the TMC, GMC and STEP programs into a single council removes the calendar clashes and fragmented mandates that have hampered coherent strategy, giving delegates one clear decision funnel and retiring the ≈ $581 k overhead tied to three separate groups. Entropy’s three open calls and the text revisions that followed show an iterative, collaborative design process that already aligns stakeholders around this structure. By re-using the 1 M ARB already budgeted for the legacy committees and adding no new salaries, the overhaul curbs administrative spend while still leaving room to hire specialist service providers when needed. Moving the DAO “checking account” under the Foundation lets invoices be settled in stables instead of liquidating ARB, which shields operations from price swings and smooths budgeting. Could the authors publish a concrete staffing and reporting plan, including expected monthly hours, live dashboards and an external-audit cadence, to demonstrate that the council has sufficient capacity and professional capital-allocation skill before the chance fully gets executed?
Thanks for the proposal!
IMO this is long overdue, and it is great that the DAO is seemingly willing to move towards this direction.
I have a few questions:
Thanks for the proposal!
IMO this is long overdue, and it is great that the DAO is seemingly willing to move towards this direction.
I have a few questions:
Entropy Advisors will have the autonomy to make decisions with funds pre-approved by the DAO, but all decisions must be passed by the OAT with ⅗ approval. Any decision that does not receive ⅗ approval from the OAT will be considered denied and no funds will be allocated. This includes reallocating from one asset/strategy to another, thus giving the DAO the ability to respond to changing market conditions and to hold vendors accountable. Any/All fund movements will be accompanied with an update on the forum in order to keep the wider community informed. Again, this process only pertains to funds that have already been approved for allocation by the DAO, but the standard governance process will always be required to earmark funds for deployment.
Regarding the funds already deployed:
Consolidating the treasury's management efforts into a single body will help avoid further fragmenting the DAO's organization.
We therefore agree with the change.
First, we’d like to thank Entropy to consolidate fragmented treasury management processes into a cohesive, accountable council structure which is both timely and directionally sound.
Below are our key recommendations and feedback:
I’m supportive of this proposal and appreciate the effort to reduce fragmentation across the DAO’s various treasury management initiatives. It’s encouraging to see a shift from experimentation toward a more strategic and unified approach to asset management. This is a meaningful step forward for the DAO and one that can lead to more effective and responsible stewardship of the treasury.
That said, I would like to raise a concern regarding the proposed future structure of the Treasury Management Council, specifically the role of the OAT as the ultimate decision-maker in the allocation of funds.
I’m supportive of this proposal and appreciate the effort to reduce fragmentation across the DAO’s various treasury management initiatives. It’s encouraging to see a shift from experimentation toward a more strategic and unified approach to asset management. This is a meaningful step forward for the DAO and one that can lead to more effective and responsible stewardship of the treasury.
That said, I would like to raise a concern regarding the proposed future structure of the Treasury Management Council, specifically the role of the OAT as the ultimate decision-maker in the allocation of funds.
While the OAT members are no doubt highly capable, respected contributors to the Arbitrum ecosystem, it's important to highlight that the OAT was created to guarantee Oversight and Transparency over OpCo. The role description for OAT members did not explicitly include responsibilities related to financial oversight or asset management. Financial qualifications such as Corporate Finance, Capital Allocation, and Financial & Risk Management were listed only as “desired,” not as required. As a result, none of the currently elected OAT members appear to have a professional background in finance or capital allocation.
Given the significance of the DAO’s treasury and the complexity of managing digital assets at scale, I think it’s worth asking:
Perhaps there is room to consider a structure where specialized financial expertise is more formally embedded in the decision-making process, or where checks and balances can ensure that asset management is guided by appropriate domain knowledge.
Overall, I support this proposal and view it as a much-needed evolution—but I believe it’s important we also think carefully about aligning roles and responsibilities with the skill sets required for sound financial governance.
Hi this is Brook from TiD Research. Thank you for this proposal to streamline Arbitrum’s treasury management. I strongly support consolidating STEP, TMC, and GMC into a unified Arbitrum Treasury Management Council. This restructuring will enhance efficiency and enable more informed, cohesive decisions, preventing issues like those in the Reallocate Redeemed USDM Funds to STEP 2 Budget, where millions in funds sat idle for months.
https://forum.arbitrum.foundation/t/reallocate-redeemed-usdm-funds-to-step-2-budget/29335
On June 10th, we made the following (minor) edits to this proposal before we hopefully proceed to Snapshot on June 12th:
Camelot supports this proposal as we believe in consolidation principles and avoiding waste of resources to streamline organizational efficiency. The current fragmented approach across TMC, GMC, and STEP committees has proven, at least on the side of cost, inefficient so far, and likely will show limitation in coordinating effort over time. We understand that Entropy is stewarding this initiative and that Entropy responds to the DAO, so it is natural that they lean toward acting in the best interest of the DAO and, specifically, in making the DAO independent and positive revenue generating ofr itself. However, we want to avoid the same situation as previous GMC and TMC rounds in which inclusion of protocols, and especially Arbitrum native protocols, was extremely low.
Camelot believes there is significant margin to create yield strategies for the DAO with well-balanced risk through the utilization of Arbitrum protocols, so that we realize both revenue for the DAO and growth of the ecosystem. We think this point should be of primary importance in the initiative. There is even more merit to this approach because Entropy is positioned to manage the DRIP initiative if that vote passes. While the initiatives are totally different, from a practical standpoint Entropy would then be able to manage both incentive assets and treasury assets. This creates even more reason for accountability and for also being sensitive toward growth goals for the whole ecosystem rather than focusing solely on traditional yield optimization. We sincerely think there is room for both.
On behalf of the UADP, we think this proposal to consolidate the Arbitrum Treasury Management Council is a strong step toward better coordination and clarity across treasury initiatives. The revised language from the Foundation and the open dialogue here show encouraging signs that stakeholders are aligned in principle and willing to refine implementation details together. Consolidation should reduce redundancy and improve accountability — especially important as treasury oversight matures and external scrutiny grows.
One area that hasn’t been explicitly discussed enough we think is the opportunity for the TMC to maintain a live dashboard or periodic public reporting portal, providing real-time or near-real-time visibility into treasury allocation, deployment status, and performance metrics. While high-level reports are valuable, a standardized interface for community members to track movement of funds, manager performance, and market exposure would significantly enhance transparency. It would also align with the ethos of on-chain finance and reduce informational asymmetry between the council and delegates or token holders.
I’m voting yes
We’ve tried the multi-committee setup and it clearly doesn’t scale. Everyone’s been improvising around it anyway
This structure reflects how things are mostly already working, but with clearer lines and less coordination/bureaucracy.
What matters is that strategy becomes coherent and the DAO stays in the loop without blocking every move.
Looks like a step toward treating treasury management as a long-term craft instead of a rotating experiment.
Voting in FAVOUR
As someone who suffered deeply the issues that the previous design had and had to jump through too many hoops just to continue doing a program already approved, this proposal is a welcome improvement.
I second Camelot point about how adding more responsibilities to OCL, Entropy, and the AF means further accountability is needed.
Voting in FAVOUR
As someone who suffered deeply the issues that the previous design had and had to jump through too many hoops just to continue doing a program already approved, this proposal is a welcome improvement.
I second Camelot point about how adding more responsibilities to OCL, Entropy, and the AF means further accountability is needed.
Without additional transparency from AF and alignment from Entropy (see Tanara's recommendation for Entropy's renewal), I'm genuinely concerned we're moving into an unsound governance structure that will look bad as the space matures and more analysts assess the soundness of Arbitrum as an investment (institutions) and infrastructure (enterprise). Good governance is a nice-to-have when we're dealing with degens, but the pressure will increase from now on if Arbitrum is to become key infrastructure for enterprises and a sound investment asset for institutions.
I voted FOR this proposal
I support the general goal of the proposal - to streamline Arbitrum DAO’s treasury management and reduce fragmentation. However, I would like to highlight several key risks that should be addressed as part of future on-chain implementation.
I see several key risks here:
I voted FOR this proposal
I support the general goal of the proposal - to streamline Arbitrum DAO’s treasury management and reduce fragmentation. However, I would like to highlight several key risks that should be addressed as part of future on-chain implementation.
I see several key risks here:
What I suggest to improve this ATMC:
All these suggestions and risks were raised to ensure that Arbitrum can be confident about its future. This doesn’t mean that Entropy is doing a poor job or that I find their work unsatisfactory - on the contrary, their work has greatly benefited Arbitrum. However, they are a private company with their own financial interests, while Arbitrum must prioritize its own interests and have the ability to protect them when necessary
Consolidation makes sense. There are too many parties involved in managing the DAO treasury for it to operate efficiently. The current fragmented structure clearly isn't working.
However this change would give Entropy considerable control over the treasury (even with veto oversight from OAT). It's the basic tradeoff between decentralization. We understand that Entropy is a trusted party in the Arbitrum ecosystem and they appear to have the skills and capabilities to effectively manage the treasury, or at least do a better job than the previously fragmented approach.
Consolidation makes sense. There are too many parties involved in managing the DAO treasury for it to operate efficiently. The current fragmented structure clearly isn't working.
However this change would give Entropy considerable control over the treasury (even with veto oversight from OAT). It's the basic tradeoff between decentralization. We understand that Entropy is a trusted party in the Arbitrum ecosystem and they appear to have the skills and capabilities to effectively manage the treasury, or at least do a better job than the previously fragmented approach.
But we think it's important to regularly evaluate whether Entropy remains the best entity for this role long-term. Without periodic reassessment the DAO risks capture and excessive centralization. The 3% disbandment threshold is high but necessary as a backstop. Though the burden of proposing alternatives could deter legitimate challenges to underperformance.
Overall FranklinDAO is supportive of the consolidation, but we want to ensure the DAO maintains meaningful oversight mechanisms and doesn't become overly dependent on any single service provider, including Entropy.
First, thank you to everyone who has taken the time to comment/provide feedback on this proposal, and for those who have attended the open governance calls related to treasury management to go over this proposal live. We would like to address some of the comments
First, thank you to everyone who has taken the time to comment/provide feedback on this proposal, and for those who have attended the open governance calls related to treasury management to go over this proposal live. We would like to address some of the comments
While the OAT members are no doubt highly capable, respected contributors to the Arbitrum ecosystem, it’s important to highlight that the OAT was created to guarantee Oversight and Transparency over OpCo. The role description for OAT members did not explicitly include responsibilities related to financial oversight or asset management. Financial qualifications such as Corporate Finance, Capital Allocation, and Financial & Risk Management were listed only as “desired,” not as required. As a result, none of the currently elected OAT members appear to have a professional background in finance or capital allocation.
Given the significance of the DAO’s treasury and the complexity of managing digital assets at scale, I think it’s worth asking:
We have already spoken with all of the OAT members individually prior to posting this proposal to ensure their buy-in on the role described within the proposal.
To clarify: while the proposed structure does position OAT as a final reviewer for decisions made by the Council, this is meant to function more as a governance backstop rather than a body actively driving asset allocation decisions. The day-to-day financial strategy and execution will fall on Entropy and third-party SPs, as well as the AF for operational related tasks.
How many additional hours (weekly/monthly) are expected to be allocated to treasury management across Entropy, OpCo, AF, and OAT under this structure?
Are these teams currently close to capacity under their existing mandates?
What contingency planning exists for scaling headcount or adding budget once bandwidth constraints emerge?
Could resourcing gaps lead to bottlenecks elsewhere (e.g. protocol BD, program execution, or operational oversight)?
This is likely to be a large lift in terms of hours required by Entropy and the OpCo, but very minimal hours required of the OAT, OCL, and to some extent, the AF (whose role will likely shift over to OpCo over time).
The proposal repurposes the budget that was previously approved by the DAO to pay GMC and TMC members to hire third-party SPs that can help execute on tasks that members of the Arbitrum Treasury Management Council do not possess. Additionally, each time the council goes to the DAO with a new proposal seeking funds from the treasury to allocate, it can carve out a portion of the budget for outsourcing certain tasks to SPs, depending upon the goals of the allocation. We are not concerned with resource constraints for these reasons.
Regarding the funds already deployed:
I don’t see any mention of monthly reports like the ones done for STEP I. Who would be in charge of that for the other initiatives and for STEP I after the current funding ends in September?
The DAO voted for specific allocations for STEP II and TMC & GMC. If there is anything that has not already been deployed, will it be changed before the initial allocation? While I like the idea of Entropy eventually optimising the portfolio, I believe this should be done AFTER the initial deployment. Can you clarify this point?
Entropy will be taking on the role of reporting under this proposal. We will have live dashboards (ideally with a custom frontend rather than just living on Dune to increase the DAO’s professionalism) available to anyone for free to track treasury positions, and will also post quarterly reports with insights related to treasury performance/the DAO’s financial health. We also hope to host regularly cadenced calls to go over these dashboards for the community to ask questions/learn how to leverage the insights.
In terms of the STEP II and TMC/GMC funds, nothing will change as it relates to the previously DAO-approved allocations. These are still in the process of being deployed by the AF, and an update will be posted to the forum regarding the status of these assets soon. In short, no allocations here will be changed prior to deployment, although they will be subject to reallocation over time as we collect data on their impact/performance.
1. How Service Providers Are Chosen:
We fully agree with @Tane’s concern around the selection of external service providers.
However, we have important concerns regarding the process by which these service providers will be selected. Since detailed asset allocation and risk management expertise will no longer reside directly within the council, the selection process for external providers becomes even more critical. We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism. Specifically, we recommend implementing procedures that involve the DAO directly, such as comparative evaluations or collective deliberation on multiple provider proposals. This level of transparency and accountability is essential to mitigate potential conflicts of interest, favoritism, or any perception of preferential treatment toward closely associated projects or parties.
Since the council won’t directly handle asset allocation and risk directly, who we bring in to manage those functions becomes even more important. There absolutely needs to be transparency around how service providers are selected but we don’t think it makes sense for Entropy to be the one defining those best practices.
A more neutral and structured approach would be for a group like the ADPC to oversee initial vendor engagement and negotiation. They could help standardize the selection process, run comparisons across providers, and ensure decisions are made in a way that’s fair and open. That kind of separation would go a long way in building trust and avoiding any perception of bias.
2. Defining KPIs and Performance Expectations:
With the creation of this new council, we’re effectively watching one of the first real tests of role separation between AAEs play out. That makes it even more important to clearly define how coordination will work between Entropy and the DAO, and what role OpCo will play in ensuring accountability.
At the moment, there are no concrete KPIs, reporting timelines, or clarity around how performance will be evaluated. We’d like to see a framework that outlines when and how updates are shared, what success looks like, and what mechanisms the DAO has to step in whether that’s through feedback, defunding, or replacing underperforming contributors. Without those checks and balances in place, we risk entrenching roles without recourse if expectations aren’t met.
3. Limited Options for Dispute Resolution:
If a decision turns out to be flawed or controversial, the only way to undo it is through a full council disbandment.
It would be helpful to have some middle-ground options like a review mechanism, lightweight dispute process, or a way for delegates to raise concerns and prompt re-evaluation without needing to burn the whole thing down.
We’re aligned with the general direction of the proposal and appreciate the work that went into it.
Entropy will be handling the asset allocation recommendations, which will require OAT approval in order to ensure checks and balances are in place. The risk monitoring component will likely be outsourced on a case-by-case basis to qualified SPs, dependent upon the goals the DAO approves in the treasury allocation proposal. In terms of the process of procuring these SPs, Entropy will be leveraging its network to contract the best talent at the fairest price on behalf of the DAO, and the OpCo will be posting communications/rationale for vender selection on the forum to ensure transparency.
In terms of reporting timelines, this information is in the proposal and answered above.
In terms of KPIs, this will be defined in the proposals to the DAO that seek treasury allocations, which then go through the normal voting process. The DAO will essentially approve each allocation's goals, and the success of the council should be measured based on how well it accomplishes these goals. This is another reason the OAT made sense as the approval body, as it serves as a check on recommendations made by Entropy that the allocations do in fact align with the DAO’s desires.
In terms of disputes, the proposal was recently modified to enable the OAT to make emergency actions, and the DAO has the ability to refute/reverse/clawback any allocation via Snapshot (Defined in the proposal).
The treasury has four objectives IMO:
Generate yield so the DAO is self-sustaining. This is the core of the Entropy plan and matches the focus of previous committees.
Grow the DAO’s real-world-asset exposure and diversify risk.
Support established Arbitrum protocols.
Bootstrap liquidity for new Arbitrum projects. Early liquidity means other users feel confident to deposit funds, and all the DeFi flywheels that protocols enable can actually work.
One million dollars spread across nascent protocols is probably far more valuable than the same sum parked in T-bills.
This is distinct from the DRIP incentives proposal; here I am speaking about direct liquidity provision, for example:
• The DAO provides backstop liquidity to tokenised houses from Estate Protocol at a predefined floor to anchor prices.
• $200k of liquidity is supplied to a new perpetual exchange to compress funding costs.
• $500k is lent to solver pools so intents can settle promptly (RIP Chain Abstraction Proposal :face_exhaling:).
The Treasury Management Council should publish its intended allocation split for the year and retain discretion to redeploy capital quickly into high-impact liquidity pools.
Under the proposed structure, the DAO will approve the goals of each treasury allocation prior to moving funds to the AF and its subsequent deployment in line with recommendations from Entropy that are finally approved by the OAT. The OAT’s primary role is ensuring that the allocation recommendations are in-line with what the DAO approved. We agree with these 4 treasury goals.
In terms of the allocation split, we will attempt to establish a high-level target allocation structure in tandem with our budget creation process.
gm, I am generally aligned and this sums up my view.
gm, I am generally aligned and this sums up my view.
has clearly led to inefficiencies and misalignment among treasury strategies.
Inefficiencies are clear. Could you outline the misalignments you’ve observed so the DAO and the new Treasury Committee can address them?
TMC to maintain a live dashboard or periodic public reporting portal, providing real-time or near-real-time visibility into treasury allocation, deployment status, and performance metrics.
This is a great call and I think it should be added into the requirements. It's much more effective than a static report, and I'm sure Entropy's data team can craft a useful interface.
Camelot believes there is significant margin to create yield strategies for the DAO with well-balanced risk through the utilization of Arbitrum protocols, so that we realize both revenue for the DAO and growth of the ecosystem. We think this point should be of primary importance in the initiative. There is even more merit to this approach because Entropy is positioned to manage the DRIP initiative if that vote passes. While the initiatives are totally different, from a practical standpoint Entropy would then be able to manage both incentive assets and treasury assets.
Would it be possible to describe how the allocation strategy will look? For example, will the AUM be divided into several sub-portfolios (e.g., stablecoins, ETH, RWAs) to diversify risk and align with the previous mandates of STEP, TMC, and GMC, or will you pursue a single, unified portfolio approach?
I want to emphasise the points raised by Camelot, JoJo and TID.
The treasury has four objectives IMO:
Generate yield so the DAO is self-sustaining. This is the core of the Entropy plan and matches the focus of previous committees.
Grow the DAO’s real-world-asset exposure and diversify risk.
Support established Arbitrum protocols.
Bootstrap liquidity for new Arbitrum projects. Early liquidity means other users feel confident to deposit funds, and all the DeFi flywheels that protocols enable can actually work. One million dollars spread across nascent protocols is probably far more valuable than the same sum parked in T-bills.
This is distinct from the DRIP incentives proposal; here I am speaking about direct liquidity provision, for example: • The DAO provides backstop liquidity to tokenised houses from Estate Protocol at a predefined floor to anchor prices. • $200k of liquidity is supplied to a new perpetual exchange to compress funding costs. • $500k is lent to solver pools so intents can settle promptly (RIP Chain Abstraction Proposal :face_exhaling:).
The Treasury Management Council should publish its intended allocation split for the year and retain discretion to redeploy capital quickly into high-impact liquidity pools.
We’re supportive of consolidating the different treasury committees into a single council. The current structure is fragmented and hard to coordinate. Bringing everything under one roof makes sense and should help the DAO operate more efficiently.
That said, there are a few areas we think need more attention:
1. How Service Providers Are Chosen:
We’re supportive of consolidating the different treasury committees into a single council. The current structure is fragmented and hard to coordinate. Bringing everything under one roof makes sense and should help the DAO operate more efficiently.
That said, there are a few areas we think need more attention:
1. How Service Providers Are Chosen:
We fully agree with @Tane’s concern around the selection of external service providers.
However, we have important concerns regarding the process by which these service providers will be selected. Since detailed asset allocation and risk management expertise will no longer reside directly within the council, the selection process for external providers becomes even more critical. We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism. Specifically, we recommend implementing procedures that involve the DAO directly, such as comparative evaluations or collective deliberation on multiple provider proposals. This level of transparency and accountability is essential to mitigate potential conflicts of interest, favoritism, or any perception of preferential treatment toward closely associated projects or parties.
Since the council won’t directly handle asset allocation and risk directly, who we bring in to manage those functions becomes even more important. There absolutely needs to be transparency around how service providers are selected but we don’t think it makes sense for Entropy to be the one defining those best practices.
A more neutral and structured approach would be for a group like the ADPC to oversee initial vendor engagement and negotiation. They could help standardize the selection process, run comparisons across providers, and ensure decisions are made in a way that’s fair and open. That kind of separation would go a long way in building trust and avoiding any perception of bias.
2. Defining KPIs and Performance Expectations:
With the creation of this new council, we’re effectively watching one of the first real tests of role separation between AAEs play out. That makes it even more important to clearly define how coordination will work between Entropy and the DAO, and what role OpCo will play in ensuring accountability.
At the moment, there are no concrete KPIs, reporting timelines, or clarity around how performance will be evaluated. We’d like to see a framework that outlines when and how updates are shared, what success looks like, and what mechanisms the DAO has to step in whether that’s through feedback, defunding, or replacing underperforming contributors. Without those checks and balances in place, we risk entrenching roles without recourse if expectations aren’t met.
3. Limited Options for Dispute Resolution:
If a decision turns out to be flawed or controversial, the only way to undo it is through a full council disbandment.
It would be helpful to have some middle-ground options like a review mechanism, lightweight dispute process, or a way for delegates to raise concerns and prompt re-evaluation without needing to burn the whole thing down.
We’re aligned with the general direction of the proposal and appreciate the work that went into it.
I'm voting yes because this proposal makes things more organized. Right now, there are too many separate groups handling the treasury, and it's confusing and costly. This new setup brings everything under one council, which should make it easier to manage funds and make smarter decisions for the DAO.
On June 16th, we made the following changes to this proposal before we hopefully proceed to Snapshot on June 19th:
On June 16th, we made the following changes to this proposal before we hopefully proceed to Snapshot on June 19th:
We will be covering these changes on the DAO's Open Discussions of Proposals call tomorrow, June 17th at 12pm ET.
AranaDigital supports the creation of the unified Arbitrum Treasury Management Council because merging the TMC, GMC and STEP programs into a single council removes the calendar clashes and fragmented mandates that have hampered coherent strategy, giving delegates one clear decision funnel and retiring the ≈ $581 k overhead tied to three separate groups. Entropy’s three open calls and the text revisions that followed show an iterative, collaborative design process that already aligns stakeholders around this structure. By re-using the 1 M ARB already budgeted for the legacy committees and adding no new salaries, the overhaul curbs administrative spend while still leaving room to hire specialist service providers when needed. Moving the DAO “checking account” under the Foundation lets invoices be settled in stables instead of liquidating ARB, which shields operations from price swings and smooths budgeting. Could the authors publish a concrete staffing and reporting plan, including expected monthly hours, live dashboards and an external-audit cadence, to demonstrate that the council has sufficient capacity and professional capital-allocation skill before the chance fully gets executed?
Thanks for the proposal!
IMO this is long overdue, and it is great that the DAO is seemingly willing to move towards this direction.
I have a few questions:
Thanks for the proposal!
IMO this is long overdue, and it is great that the DAO is seemingly willing to move towards this direction.
I have a few questions:
Entropy Advisors will have the autonomy to make decisions with funds pre-approved by the DAO, but all decisions must be passed by the OAT with ⅗ approval. Any decision that does not receive ⅗ approval from the OAT will be considered denied and no funds will be allocated. This includes reallocating from one asset/strategy to another, thus giving the DAO the ability to respond to changing market conditions and to hold vendors accountable. Any/All fund movements will be accompanied with an update on the forum in order to keep the wider community informed. Again, this process only pertains to funds that have already been approved for allocation by the DAO, but the standard governance process will always be required to earmark funds for deployment.
Regarding the funds already deployed:
Consolidating the treasury's management efforts into a single body will help avoid further fragmenting the DAO's organization.
We therefore agree with the change.
First, we’d like to thank Entropy to consolidate fragmented treasury management processes into a cohesive, accountable council structure which is both timely and directionally sound.
Below are our key recommendations and feedback:
I’m supportive of this proposal and appreciate the effort to reduce fragmentation across the DAO’s various treasury management initiatives. It’s encouraging to see a shift from experimentation toward a more strategic and unified approach to asset management. This is a meaningful step forward for the DAO and one that can lead to more effective and responsible stewardship of the treasury.
That said, I would like to raise a concern regarding the proposed future structure of the Treasury Management Council, specifically the role of the OAT as the ultimate decision-maker in the allocation of funds.
I’m supportive of this proposal and appreciate the effort to reduce fragmentation across the DAO’s various treasury management initiatives. It’s encouraging to see a shift from experimentation toward a more strategic and unified approach to asset management. This is a meaningful step forward for the DAO and one that can lead to more effective and responsible stewardship of the treasury.
That said, I would like to raise a concern regarding the proposed future structure of the Treasury Management Council, specifically the role of the OAT as the ultimate decision-maker in the allocation of funds.
While the OAT members are no doubt highly capable, respected contributors to the Arbitrum ecosystem, it's important to highlight that the OAT was created to guarantee Oversight and Transparency over OpCo. The role description for OAT members did not explicitly include responsibilities related to financial oversight or asset management. Financial qualifications such as Corporate Finance, Capital Allocation, and Financial & Risk Management were listed only as “desired,” not as required. As a result, none of the currently elected OAT members appear to have a professional background in finance or capital allocation.
Given the significance of the DAO’s treasury and the complexity of managing digital assets at scale, I think it’s worth asking:
Perhaps there is room to consider a structure where specialized financial expertise is more formally embedded in the decision-making process, or where checks and balances can ensure that asset management is guided by appropriate domain knowledge.
Overall, I support this proposal and view it as a much-needed evolution—but I believe it’s important we also think carefully about aligning roles and responsibilities with the skill sets required for sound financial governance.
Hi this is Brook from TiD Research. Thank you for this proposal to streamline Arbitrum’s treasury management. I strongly support consolidating STEP, TMC, and GMC into a unified Arbitrum Treasury Management Council. This restructuring will enhance efficiency and enable more informed, cohesive decisions, preventing issues like those in the Reallocate Redeemed USDM Funds to STEP 2 Budget, where millions in funds sat idle for months.
https://forum.arbitrum.foundation/t/reallocate-redeemed-usdm-funds-to-step-2-budget/29335
On June 10th, we made the following (minor) edits to this proposal before we hopefully proceed to Snapshot on June 12th:
Camelot supports this proposal as we believe in consolidation principles and avoiding waste of resources to streamline organizational efficiency. The current fragmented approach across TMC, GMC, and STEP committees has proven, at least on the side of cost, inefficient so far, and likely will show limitation in coordinating effort over time. We understand that Entropy is stewarding this initiative and that Entropy responds to the DAO, so it is natural that they lean toward acting in the best interest of the DAO and, specifically, in making the DAO independent and positive revenue generating ofr itself. However, we want to avoid the same situation as previous GMC and TMC rounds in which inclusion of protocols, and especially Arbitrum native protocols, was extremely low.
Camelot believes there is significant margin to create yield strategies for the DAO with well-balanced risk through the utilization of Arbitrum protocols, so that we realize both revenue for the DAO and growth of the ecosystem. We think this point should be of primary importance in the initiative. There is even more merit to this approach because Entropy is positioned to manage the DRIP initiative if that vote passes. While the initiatives are totally different, from a practical standpoint Entropy would then be able to manage both incentive assets and treasury assets. This creates even more reason for accountability and for also being sensitive toward growth goals for the whole ecosystem rather than focusing solely on traditional yield optimization. We sincerely think there is room for both.
On behalf of the UADP, we think this proposal to consolidate the Arbitrum Treasury Management Council is a strong step toward better coordination and clarity across treasury initiatives. The revised language from the Foundation and the open dialogue here show encouraging signs that stakeholders are aligned in principle and willing to refine implementation details together. Consolidation should reduce redundancy and improve accountability — especially important as treasury oversight matures and external scrutiny grows.
One area that hasn’t been explicitly discussed enough we think is the opportunity for the TMC to maintain a live dashboard or periodic public reporting portal, providing real-time or near-real-time visibility into treasury allocation, deployment status, and performance metrics. While high-level reports are valuable, a standardized interface for community members to track movement of funds, manager performance, and market exposure would significantly enhance transparency. It would also align with the ethos of on-chain finance and reduce informational asymmetry between the council and delegates or token holders.
First, we’d like to thank Entropy to consolidate fragmented treasury management processes into a cohesive, accountable council structure which is both timely and directionally sound.
Below are our key recommendations and feedback:
The proposal currently moves to sunset the TMC, GMC, and STEP committees, all of which were deliberately created by the DAO as decentralized treasury management experiments. This is not simply a technical consolidation but a significant governance decision that retires three separate DAO-designed mechanisms. Given the scale of this structural change, we believe it is critical that a formal post-mortem is conducted upon finalising the transition.
Beyond identifying operational shortcomings, this post-mortem should also capture what worked well under these decentralized structures: instances of effective vendor coordination, committee diversity benefits or vendor accountability achieved through distributed oversight. Understanding both the successes and failures of these decentralized committees will help prevent importing any systemic risks into the new, more centralized structure while preserving elements that added real value. We believe this institutional learning process is critical DAO information, especially for a DAO that may need to iterate on future governance experiments.
We strongly recommend publishing a formal Lessons Learned document as part of the final governance process.
The proposal correctly highlights that Entropy, the Arbitrum Foundation, OpCo, and OAT are DAO-funded and thus no new salaries are required for this consolidation. However, this significantly underestimates the resource implications of centralizing treasury management into these entities. Treasury management is resource-intensive: requiring constant market monitoring, complex risk modeling, vendor oversight, compliance work, data transparency infrastructure, and high-touch coordination with BD, AAEs, service providers, and third-party vendors. Simply assuming that these new tasks can be absorbed without additional budget ignores the fact that human capital within these entities is finite. Time dedicated to treasury management will be time diverted from other mission-critical workstreams within these AAEs. Once current capacity is maxed, new hires or expanded operational budgets may be required. It is better to anticipate this now than defer inevitable resourcing issues.
We request further clarification on:
Without clarity on resourcing, we risk creating invisible operational debt that may impair both treasury management and other DAO functions long-term.
Hi this is Brook from TiD Research. Thank you for this proposal to streamline Arbitrum’s treasury management. I strongly support consolidating STEP, TMC, and GMC into a unified Arbitrum Treasury Management Council. This restructuring will enhance efficiency and enable more informed, cohesive decisions, preventing issues like those in the Reallocate Redeemed USDM Funds to STEP 2 Budget, where millions in funds sat idle for months.
https://forum.arbitrum.foundation/t/reallocate-redeemed-usdm-funds-to-step-2-budget/29335
I have questions for Entropy as the Execution Body regarding the investment mandate for the ~$50M AUM.
I also strongly support the “DAO’s Checking Account” under the Arbitrum Foundation’s management, which addresses stablecoin shortfall issues caused by ARB price volatility, as highlighted in the TMC Stablecoin Withdrawal Process and HCP Top-Up.
On June 10th, we made the following (minor) edits to this proposal before we hopefully proceed to Snapshot on June 12th:
As a PSA, there will be a fourth open discussion call related to this proposal tomorrow (Wednesday, June 11th). This call link can be found on the DAO's open calendar, or alternatively, here.
Camelot supports this proposal as we believe in consolidation principles and avoiding waste of resources to streamline organizational efficiency. The current fragmented approach across TMC, GMC, and STEP committees has proven, at least on the side of cost, inefficient so far, and likely will show limitation in coordinating effort over time. We understand that Entropy is stewarding this initiative and that Entropy responds to the DAO, so it is natural that they lean toward acting in the best interest of the DAO and, specifically, in making the DAO independent and positive revenue generating ofr itself. However, we want to avoid the same situation as previous GMC and TMC rounds in which inclusion of protocols, and especially Arbitrum native protocols, was extremely low.
Camelot believes there is significant margin to create yield strategies for the DAO with well-balanced risk through the utilization of Arbitrum protocols, so that we realize both revenue for the DAO and growth of the ecosystem. We think this point should be of primary importance in the initiative. There is even more merit to this approach because Entropy is positioned to manage the DRIP initiative if that vote passes. While the initiatives are totally different, from a practical standpoint Entropy would then be able to manage both incentive assets and treasury assets. This creates even more reason for accountability and for also being sensitive toward growth goals for the whole ecosystem rather than focusing solely on traditional yield optimization. We sincerely think there is room for both.
We also want to be mindful about how this initiative represents another key one in which AF/OCL/Entropy have the lead. While it makes sense for AAEs to have this lead, since they are best positioned from a business, technological and ecosystem standpoint, we also need to remind ourself how these are just more reasons to keep the AAEs accountable since, at this point, all leverages are there for them to operate effectively. As expected from the Vision post, all strategic initiatives are now slowly transitioning in the hands or will be in the hands of AAEs. We won’t be able to have proper accountability without spelling out clearly what success looks like, and if something doesn’t play out as expected, the AAEs will have to properly analyze what happened, why, and find countermeasures that the DAO will have to agree upon.
On behalf of the UADP, we think this proposal to consolidate the Arbitrum Treasury Management Council is a strong step toward better coordination and clarity across treasury initiatives. The revised language from the Foundation and the open dialogue here show encouraging signs that stakeholders are aligned in principle and willing to refine implementation details together. Consolidation should reduce redundancy and improve accountability — especially important as treasury oversight matures and external scrutiny grows.
One area that hasn’t been explicitly discussed enough we think is the opportunity for the TMC to maintain a live dashboard or periodic public reporting portal, providing real-time or near-real-time visibility into treasury allocation, deployment status, and performance metrics. While high-level reports are valuable, a standardized interface for community members to track movement of funds, manager performance, and market exposure would significantly enhance transparency. It would also align with the ethos of on-chain finance and reduce informational asymmetry between the council and delegates or token holders.
As this Council structure comes together, it may also be helpful to predefine an annual or biannual external audit requirement, conducted by a third-party DAO-native treasury auditor. While this could be lightweight in scope, it would ensure continuous alignment with best practices and create pressure for high standards.
Overall, we support the proposed direction, and we would like @Entropy to further clarify two crucial elements within this proposal: first, the transparency and accountability of the service provider selection process, and second, the explicit governance process surrounding medium- to long-term financial planning. By clearly addressing these points and adjusting the proposal, we believe that the proposed Arbitrum Treasury Management Council can become an exemplary governance structure, providing Arbitrum DAO with distinct strategic advantages and fostering greater trust and clarity among all stakeholders.
Overall, we support the proposed direction, and we would like @Entropy to further clarify two crucial elements within this proposal: first, the transparency and accountability of the service provider selection process, and second, the explicit governance process surrounding medium- to long-term financial planning. By clearly addressing these points and adjusting the proposal, we believe that the proposed Arbitrum Treasury Management Council can become an exemplary governance structure, providing Arbitrum DAO with distinct strategic advantages and fostering greater trust and clarity among all stakeholders.
We support the proposed direction of simplifying Arbitrum DAO’s treasury management structure. The current environment, characterized by multiple committees operating independently, has clearly led to inefficiencies and misalignment among treasury strategies. Consolidating these structures into a unified council will undoubtedly improve coordination and overall strategic alignment within the DAO.
In particular, we recognize significant value in Entropy taking responsibility for the creation of medium- to long-term financial planning and forecasting. This is critical because many DAOs struggle with effectively aligning their strategic business objectives with clear financial constraints and goals. By having Entropy model these financial plans, Arbitrum DAO can benefit from increased clarity regarding budget constraints and individual objectives, enhancing strategic coherence across the ecosystem, which is far beyond doing asset management for DAOs.
We also broadly agree with the proposed three-part governance structure comprising the Voting Body, Execution Body, and Communications Body. Given Entropy’s strengths and past experiences, we find it appropriate and beneficial that they assume responsibility for strategic financial planning, as this has been an area of need and aligns well with Entropy’s competencies.
At the same time, we recognize the importance of having specialized external service providers involved in detailed treasury management operations, such as risk management and asset allocation execution. While Entropy plays a critical strategic role, external service providers will specialists are essential for robust, effective, and transparent treasury management. We appreciate that the proposal explicitly highlights the outsourcing of these responsibilities to dedicated experts and consider this approach both appropriate and necessary.
However, we have important concerns regarding the process by which these service providers will be selected. Since detailed asset allocation and risk management expertise will no longer reside directly within the council, the selection process for external providers becomes even more critical. We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism. Specifically, we recommend implementing procedures that involve the DAO directly, such as comparative evaluations or collective deliberation on multiple provider proposals. This level of transparency and accountability is essential to mitigate potential conflicts of interest, favoritism, or any perception of preferential treatment toward closely associated projects or parties.
Our primary reason for supporting the inclusion of Entropy in this proposed treasury management structure is not merely to optimize asset management, but rather to significantly elevate strategic alignment and strengthen the DAO’s medium- and long-term governance capabilities. We believe that having Entropy facilitate comprehensive financial planning tied directly to Arbitrum DAO’s overall strategic and operational goals will enable higher-level decision-making within the DAO. Without this strategic alignment, we see limited value in inserting an intermediary between the DAO and external service providers.
Thus, it is crucial to clearly define how medium- and long-term financial plans will be developed, managed, and revised. These financial strategies must be explicitly aligned with Strategic Objective Setting (SOS) and receive formal DAO approval. This approval might not need to involve strict commitment to specific budgetary line items for some part, given market volatility, but should establish a broadly supported consensus on strategic objectives, budgetary guidelines, and financial constraints. Regular cycles of planning, evaluation, and adjustment should be clearly established, with periodic reviews to ensure alignment remains robust and responsive to changing conditions.
We love the idea of consolidating treasury management. While centralizing responsibilities within a DAO warrants scrutiny, the current treasury management structure suffers from a lack of accountability due to excessive fragmentation. Implementing this proposal would increase accountability over treasury management, and provide the DAO with a clear point of contact (Communications Body).
On that note, we are curious about how the Council will measure and report on its performance. Will there be written reports released periodically, or will there be a dashboard for DAO participants to view real-time treasury information, similar to the one Entropy has?
We love the idea of consolidating treasury management. While centralizing responsibilities within a DAO warrants scrutiny, the current treasury management structure suffers from a lack of accountability due to excessive fragmentation. Implementing this proposal would increase accountability over treasury management, and provide the DAO with a clear point of contact (Communications Body).
On that note, we are curious about how the Council will measure and report on its performance. Will there be written reports released periodically, or will there be a dashboard for DAO participants to view real-time treasury information, similar to the one Entropy has?
We are super excited to see the development of this proposal
Michigan Blockchain | Jack Verrill | TG @JackVerrill
We wanted to point out that the last quote in your comment has been changed after conferring further with the Arbitrum Foundation on the best path forward.
Understood and feels more streamlined now, thank you i would have not noticed the change.
Thank you for your comments, JoJo.
We wanted to point out that the last quote in your comment has been changed after conferring further with the Arbitrum Foundation on the best path forward.
Thank you for your comments, JoJo.
We wanted to point out that the last quote in your comment has been changed after conferring further with the Arbitrum Foundation on the best path forward.
On the point of sacrificing a bit of yield to support our most important protocols - the goals of funding requests will be very clearly outlined in the proposals the DAO votes on. In TMv1.2, we made the mistake of conflating the goals of the funding request with growth and passive yield, which we intend to make much more clear moving forward when submitting requests for funds (which eventually, the OpCo will actually do). Ultimately, the DAO will determine via vote what the goal of each funding allotment will be, which will steer allocation decisions.
Additionally, given the diversity of the OAT, we feel confident the goals set out by the DAO will be strictly enforced. We definitely agree that supporting our most important protocols is of utmost importance. Whether that is achieved through treasury management or other programs will ultimately be up to the DAO.
Thanks for the proposal, and for the lenghtly discussion in calls.
A first feedback on the overarching scope, having a single body managing the treasury of the DAO. We need this. We have a lot of assets deployed in RWA, we are now starting to utilise the Ethereum of the treasury as productive assets, and we have a cash account. It does only make sense, from both a cost and management perspective, to have a unified approach to all of this. Would still like to explore a few points mentioned, both here and also in the calls that we had.
Thanks for the proposal, and for the lenghtly discussion in calls.
A first feedback on the overarching scope, having a single body managing the treasury of the DAO. We need this. We have a lot of assets deployed in RWA, we are now starting to utilise the Ethereum of the treasury as productive assets, and we have a cash account. It does only make sense, from both a cost and management perspective, to have a unified approach to all of this. Would still like to explore a few points mentioned, both here and also in the calls that we had.
We want, and need, AF/OCL to be perfectly aware of what we are doing and eventually inform us of potential opportunities.
While there are several entities in the DAO that have treasury expertise (thinking KPK, Avantgarde to name a couple) there is for now only one entity that is exclusive to our DAO and so has the most aligned nature. So it makes sense to have if any external SPs as executor/risk consultant, with strategic planning coming from Entropy. We have also seen how Entropy does have financial capacities, so I think this choice is the right one. One hope, not necessarily a request, is that Entropy, in evaluating over time how to deploy assets, will also take in consideration the secondary goal of using these assets also for growth. As long as we are in proper risk parameters, allocating for example for a slightly lower APR but utilsing a protocol deemed key in our ecosystem would be, to me, the optimal outcome. To reiterate: this can be a secondary goal not a primary one. But I am pretty sure that this will be taken in consideration, knowing that also OCL and AF are involved.
Moving forward, we propose giving the entity tasked with custody (in this case, the AF) full discretion over covering service provider shortfalls or spending treasury assets instead of using issued ARB to cover dollar-denominated expenses in proposals that pass through Tally. The AF will be required to adhere to any future structures that arise, including but not limited to a DAO budget or Net Working Capital requirements. It’ll be of great importance that the AF, through OpCo, informs a proposer whether or not the proposal’s expenses should be covered through the DAO’s non-native assets instead of issuing more ARB well before the proposal is moved to the voting stage. This way, delegates know whether or not the proposal is asking to dilute ARB when casting their votes or to spend down cash positions from the treasury. However, if this communication does not occur and the language is not included in the original Tally proposal, but the AF still wishes to spend treasury assets, it may do so with the requirement that the ARB moved from the Tally proposal is converted over the subsequent 30-day period for cash-like assets (or the same asset that was spent) and redeployed to the strategy in which the original position was drawn from. Note that such an occurrence should be considered a failure in operations, and this clause is only put in place such that the existing portfolio composition isn’t unexpectedly changed in cases where there has been a breakdown in communications.
This point can likely be considered controversial at first glance by some. But I think is a somehow pragmatic approach to the reality that we have, which is
Going back to the initial point, this solution seems pragmatic with a reality that has seen several proposals not being funded in a timely fashion due to these externalities.
First, we’d like to thank Entropy to consolidate fragmented treasury management processes into a cohesive, accountable council structure which is both timely and directionally sound.
Below are our key recommendations and feedback:
The proposal currently moves to sunset the TMC, GMC, and STEP committees, all of which were deliberately created by the DAO as decentralized treasury management experiments. This is not simply a technical consolidation but a significant governance decision that retires three separate DAO-designed mechanisms. Given the scale of this structural change, we believe it is critical that a formal post-mortem is conducted upon finalising the transition.
Beyond identifying operational shortcomings, this post-mortem should also capture what worked well under these decentralized structures: instances of effective vendor coordination, committee diversity benefits or vendor accountability achieved through distributed oversight. Understanding both the successes and failures of these decentralized committees will help prevent importing any systemic risks into the new, more centralized structure while preserving elements that added real value. We believe this institutional learning process is critical DAO information, especially for a DAO that may need to iterate on future governance experiments.
We strongly recommend publishing a formal Lessons Learned document as part of the final governance process.
The proposal correctly highlights that Entropy, the Arbitrum Foundation, OpCo, and OAT are DAO-funded and thus no new salaries are required for this consolidation. However, this significantly underestimates the resource implications of centralizing treasury management into these entities. Treasury management is resource-intensive: requiring constant market monitoring, complex risk modeling, vendor oversight, compliance work, data transparency infrastructure, and high-touch coordination with BD, AAEs, service providers, and third-party vendors. Simply assuming that these new tasks can be absorbed without additional budget ignores the fact that human capital within these entities is finite. Time dedicated to treasury management will be time diverted from other mission-critical workstreams within these AAEs. Once current capacity is maxed, new hires or expanded operational budgets may be required. It is better to anticipate this now than defer inevitable resourcing issues.
We request further clarification on:
Without clarity on resourcing, we risk creating invisible operational debt that may impair both treasury management and other DAO functions long-term.
Hi this is Brook from TiD Research. Thank you for this proposal to streamline Arbitrum’s treasury management. I strongly support consolidating STEP, TMC, and GMC into a unified Arbitrum Treasury Management Council. This restructuring will enhance efficiency and enable more informed, cohesive decisions, preventing issues like those in the Reallocate Redeemed USDM Funds to STEP 2 Budget, where millions in funds sat idle for months.
https://forum.arbitrum.foundation/t/reallocate-redeemed-usdm-funds-to-step-2-budget/29335
I have questions for Entropy as the Execution Body regarding the investment mandate for the ~$50M AUM.
I also strongly support the “DAO’s Checking Account” under the Arbitrum Foundation’s management, which addresses stablecoin shortfall issues caused by ARB price volatility, as highlighted in the TMC Stablecoin Withdrawal Process and HCP Top-Up.
On June 10th, we made the following (minor) edits to this proposal before we hopefully proceed to Snapshot on June 12th:
As a PSA, there will be a fourth open discussion call related to this proposal tomorrow (Wednesday, June 11th). This call link can be found on the DAO's open calendar, or alternatively, here.
Camelot supports this proposal as we believe in consolidation principles and avoiding waste of resources to streamline organizational efficiency. The current fragmented approach across TMC, GMC, and STEP committees has proven, at least on the side of cost, inefficient so far, and likely will show limitation in coordinating effort over time. We understand that Entropy is stewarding this initiative and that Entropy responds to the DAO, so it is natural that they lean toward acting in the best interest of the DAO and, specifically, in making the DAO independent and positive revenue generating ofr itself. However, we want to avoid the same situation as previous GMC and TMC rounds in which inclusion of protocols, and especially Arbitrum native protocols, was extremely low.
Camelot believes there is significant margin to create yield strategies for the DAO with well-balanced risk through the utilization of Arbitrum protocols, so that we realize both revenue for the DAO and growth of the ecosystem. We think this point should be of primary importance in the initiative. There is even more merit to this approach because Entropy is positioned to manage the DRIP initiative if that vote passes. While the initiatives are totally different, from a practical standpoint Entropy would then be able to manage both incentive assets and treasury assets. This creates even more reason for accountability and for also being sensitive toward growth goals for the whole ecosystem rather than focusing solely on traditional yield optimization. We sincerely think there is room for both.
We also want to be mindful about how this initiative represents another key one in which AF/OCL/Entropy have the lead. While it makes sense for AAEs to have this lead, since they are best positioned from a business, technological and ecosystem standpoint, we also need to remind ourself how these are just more reasons to keep the AAEs accountable since, at this point, all leverages are there for them to operate effectively. As expected from the Vision post, all strategic initiatives are now slowly transitioning in the hands or will be in the hands of AAEs. We won’t be able to have proper accountability without spelling out clearly what success looks like, and if something doesn’t play out as expected, the AAEs will have to properly analyze what happened, why, and find countermeasures that the DAO will have to agree upon.
On behalf of the UADP, we think this proposal to consolidate the Arbitrum Treasury Management Council is a strong step toward better coordination and clarity across treasury initiatives. The revised language from the Foundation and the open dialogue here show encouraging signs that stakeholders are aligned in principle and willing to refine implementation details together. Consolidation should reduce redundancy and improve accountability — especially important as treasury oversight matures and external scrutiny grows.
One area that hasn’t been explicitly discussed enough we think is the opportunity for the TMC to maintain a live dashboard or periodic public reporting portal, providing real-time or near-real-time visibility into treasury allocation, deployment status, and performance metrics. While high-level reports are valuable, a standardized interface for community members to track movement of funds, manager performance, and market exposure would significantly enhance transparency. It would also align with the ethos of on-chain finance and reduce informational asymmetry between the council and delegates or token holders.
As this Council structure comes together, it may also be helpful to predefine an annual or biannual external audit requirement, conducted by a third-party DAO-native treasury auditor. While this could be lightweight in scope, it would ensure continuous alignment with best practices and create pressure for high standards.
Overall, we support the proposed direction, and we would like @Entropy to further clarify two crucial elements within this proposal: first, the transparency and accountability of the service provider selection process, and second, the explicit governance process surrounding medium- to long-term financial planning. By clearly addressing these points and adjusting the proposal, we believe that the proposed Arbitrum Treasury Management Council can become an exemplary governance structure, providing Arbitrum DAO with distinct strategic advantages and fostering greater trust and clarity among all stakeholders.
Overall, we support the proposed direction, and we would like @Entropy to further clarify two crucial elements within this proposal: first, the transparency and accountability of the service provider selection process, and second, the explicit governance process surrounding medium- to long-term financial planning. By clearly addressing these points and adjusting the proposal, we believe that the proposed Arbitrum Treasury Management Council can become an exemplary governance structure, providing Arbitrum DAO with distinct strategic advantages and fostering greater trust and clarity among all stakeholders.
We support the proposed direction of simplifying Arbitrum DAO’s treasury management structure. The current environment, characterized by multiple committees operating independently, has clearly led to inefficiencies and misalignment among treasury strategies. Consolidating these structures into a unified council will undoubtedly improve coordination and overall strategic alignment within the DAO.
In particular, we recognize significant value in Entropy taking responsibility for the creation of medium- to long-term financial planning and forecasting. This is critical because many DAOs struggle with effectively aligning their strategic business objectives with clear financial constraints and goals. By having Entropy model these financial plans, Arbitrum DAO can benefit from increased clarity regarding budget constraints and individual objectives, enhancing strategic coherence across the ecosystem, which is far beyond doing asset management for DAOs.
We also broadly agree with the proposed three-part governance structure comprising the Voting Body, Execution Body, and Communications Body. Given Entropy’s strengths and past experiences, we find it appropriate and beneficial that they assume responsibility for strategic financial planning, as this has been an area of need and aligns well with Entropy’s competencies.
At the same time, we recognize the importance of having specialized external service providers involved in detailed treasury management operations, such as risk management and asset allocation execution. While Entropy plays a critical strategic role, external service providers will specialists are essential for robust, effective, and transparent treasury management. We appreciate that the proposal explicitly highlights the outsourcing of these responsibilities to dedicated experts and consider this approach both appropriate and necessary.
However, we have important concerns regarding the process by which these service providers will be selected. Since detailed asset allocation and risk management expertise will no longer reside directly within the council, the selection process for external providers becomes even more critical. We strongly advocate for a clearly articulated, transparent, and accountable selection mechanism. Specifically, we recommend implementing procedures that involve the DAO directly, such as comparative evaluations or collective deliberation on multiple provider proposals. This level of transparency and accountability is essential to mitigate potential conflicts of interest, favoritism, or any perception of preferential treatment toward closely associated projects or parties.
Our primary reason for supporting the inclusion of Entropy in this proposed treasury management structure is not merely to optimize asset management, but rather to significantly elevate strategic alignment and strengthen the DAO’s medium- and long-term governance capabilities. We believe that having Entropy facilitate comprehensive financial planning tied directly to Arbitrum DAO’s overall strategic and operational goals will enable higher-level decision-making within the DAO. Without this strategic alignment, we see limited value in inserting an intermediary between the DAO and external service providers.
Thus, it is crucial to clearly define how medium- and long-term financial plans will be developed, managed, and revised. These financial strategies must be explicitly aligned with Strategic Objective Setting (SOS) and receive formal DAO approval. This approval might not need to involve strict commitment to specific budgetary line items for some part, given market volatility, but should establish a broadly supported consensus on strategic objectives, budgetary guidelines, and financial constraints. Regular cycles of planning, evaluation, and adjustment should be clearly established, with periodic reviews to ensure alignment remains robust and responsive to changing conditions.
We love the idea of consolidating treasury management. While centralizing responsibilities within a DAO warrants scrutiny, the current treasury management structure suffers from a lack of accountability due to excessive fragmentation. Implementing this proposal would increase accountability over treasury management, and provide the DAO with a clear point of contact (Communications Body).
On that note, we are curious about how the Council will measure and report on its performance. Will there be written reports released periodically, or will there be a dashboard for DAO participants to view real-time treasury information, similar to the one Entropy has?
We love the idea of consolidating treasury management. While centralizing responsibilities within a DAO warrants scrutiny, the current treasury management structure suffers from a lack of accountability due to excessive fragmentation. Implementing this proposal would increase accountability over treasury management, and provide the DAO with a clear point of contact (Communications Body).
On that note, we are curious about how the Council will measure and report on its performance. Will there be written reports released periodically, or will there be a dashboard for DAO participants to view real-time treasury information, similar to the one Entropy has?
We are super excited to see the development of this proposal
Michigan Blockchain | Jack Verrill | TG @JackVerrill
We wanted to point out that the last quote in your comment has been changed after conferring further with the Arbitrum Foundation on the best path forward.
Understood and feels more streamlined now, thank you i would have not noticed the change.
Thank you for your comments, JoJo.
We wanted to point out that the last quote in your comment has been changed after conferring further with the Arbitrum Foundation on the best path forward.
Thank you for your comments, JoJo.
We wanted to point out that the last quote in your comment has been changed after conferring further with the Arbitrum Foundation on the best path forward.
On the point of sacrificing a bit of yield to support our most important protocols - the goals of funding requests will be very clearly outlined in the proposals the DAO votes on. In TMv1.2, we made the mistake of conflating the goals of the funding request with growth and passive yield, which we intend to make much more clear moving forward when submitting requests for funds (which eventually, the OpCo will actually do). Ultimately, the DAO will determine via vote what the goal of each funding allotment will be, which will steer allocation decisions.
Additionally, given the diversity of the OAT, we feel confident the goals set out by the DAO will be strictly enforced. We definitely agree that supporting our most important protocols is of utmost importance. Whether that is achieved through treasury management or other programs will ultimately be up to the DAO.
Thanks for the proposal, and for the lenghtly discussion in calls.
A first feedback on the overarching scope, having a single body managing the treasury of the DAO. We need this. We have a lot of assets deployed in RWA, we are now starting to utilise the Ethereum of the treasury as productive assets, and we have a cash account. It does only make sense, from both a cost and management perspective, to have a unified approach to all of this. Would still like to explore a few points mentioned, both here and also in the calls that we had.
Thanks for the proposal, and for the lenghtly discussion in calls.
A first feedback on the overarching scope, having a single body managing the treasury of the DAO. We need this. We have a lot of assets deployed in RWA, we are now starting to utilise the Ethereum of the treasury as productive assets, and we have a cash account. It does only make sense, from both a cost and management perspective, to have a unified approach to all of this. Would still like to explore a few points mentioned, both here and also in the calls that we had.
We want, and need, AF/OCL to be perfectly aware of what we are doing and eventually inform us of potential opportunities.
While there are several entities in the DAO that have treasury expertise (thinking KPK, Avantgarde to name a couple) there is for now only one entity that is exclusive to our DAO and so has the most aligned nature. So it makes sense to have if any external SPs as executor/risk consultant, with strategic planning coming from Entropy. We have also seen how Entropy does have financial capacities, so I think this choice is the right one. One hope, not necessarily a request, is that Entropy, in evaluating over time how to deploy assets, will also take in consideration the secondary goal of using these assets also for growth. As long as we are in proper risk parameters, allocating for example for a slightly lower APR but utilsing a protocol deemed key in our ecosystem would be, to me, the optimal outcome. To reiterate: this can be a secondary goal not a primary one. But I am pretty sure that this will be taken in consideration, knowing that also OCL and AF are involved.
Moving forward, we propose giving the entity tasked with custody (in this case, the AF) full discretion over covering service provider shortfalls or spending treasury assets instead of using issued ARB to cover dollar-denominated expenses in proposals that pass through Tally. The AF will be required to adhere to any future structures that arise, including but not limited to a DAO budget or Net Working Capital requirements. It’ll be of great importance that the AF, through OpCo, informs a proposer whether or not the proposal’s expenses should be covered through the DAO’s non-native assets instead of issuing more ARB well before the proposal is moved to the voting stage. This way, delegates know whether or not the proposal is asking to dilute ARB when casting their votes or to spend down cash positions from the treasury. However, if this communication does not occur and the language is not included in the original Tally proposal, but the AF still wishes to spend treasury assets, it may do so with the requirement that the ARB moved from the Tally proposal is converted over the subsequent 30-day period for cash-like assets (or the same asset that was spent) and redeployed to the strategy in which the original position was drawn from. Note that such an occurrence should be considered a failure in operations, and this clause is only put in place such that the existing portfolio composition isn’t unexpectedly changed in cases where there has been a breakdown in communications.
This point can likely be considered controversial at first glance by some. But I think is a somehow pragmatic approach to the reality that we have, which is
Going back to the initial point, this solution seems pragmatic with a reality that has seen several proposals not being funded in a timely fashion due to these externalities.
