Arbitrum DAO approves additional funding for STIP proposal
Arbitrum DAO, a layer 2 networking system designed to improve Ethereum blockchain scalability, recently took a significant step in expanding its Short-Term Incentive Program (STIP). The DAO, which is governed by ARB token holders and funded through transaction fees, voted to increase its STIP budget by $23.4 million. This decision was made following a community vote that took place from November 18 to December 2, 2023.
The proposal aimed to provide additional funding to projects that were previously approved but unfunded due to the initial 50 million ARB token limit set in STIP. The recent vote resulted in an additional allocation of 21.1 million ARB tokens, worth approximately $23.4 million, bringing the overall STIP budget to 71.4 million ARB tokens.
This increased funding now extends to a total of 56 projects, highlighting the DAO’s commitment to supporting diverse and emerging builders within the Arbitrum ecosystem. This initiative is part of a broader effort to create a conducive environment for new projects and foster innovation and growth on the platform.
Among the projects receiving additional funding are Wormhole (ARB 1.8 million), Stargate Finance (ARB 2 million), and Gains Network (ARB 4.5 million). However, due to STIP’s Know Your Customer (KYC) requirements, PancakeSwap withdrew its request for 2 million ARB.
The decision to approve the increased funding was not without controversy. Some members of the Arbitrum DAO argued that a full second round of funding would have been a more equitable approach that included additional protocols in the incentive program. This sentiment reflects the ongoing debate within the community about how best to support and integrate new projects into the Arbitrum ecosystem.
Representatives of the MUX protocol have raised concerns about the additional funding resulting in a mix of projects of varying quality. But the majority vote in favor of the proposal, despite differing opinions, highlights the community’s preference for immediate action to support the broader project.
Arbitrum DAO’s decision to expand its STIP budget demonstrates its commitment to fostering a diverse and dynamic project ecosystem. The DAO aims to strengthen innovation and growth by funding additional initiatives, ensuring the platform remains competitive and attractive to both developers and users. This move also highlights the active role of ARB token holders in shaping the future of the Arbitrum ecosystem by participating in governance decisions.
Overall, the approval of the increased funding for the STIP proposal represents an important step in Arbitrum’s journey to create a thriving and inclusive environment for blockchain innovation and development.
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