On the morning of January 17, the voting on the proposal for the Arbitrum Long-term Incentive Pilot Program (hereinafter referred to as the Pilot Program) on Snapshot ended. Among the several voting options, the votes for allocating 45.815 million ARB (45 million for incentives and 815,000 for subsidies to people involved in various tasks) accounted for 57.49%, the votes for allocating 25.815 million ARB accounted for 39.23%, and the votes for allocating 35.815 million ARB accounted for 0.81%.
In the end, the vote to allocate 45.815 million ARB won, and the vote to allocate no funds at all accounted for only 2.47%.
Short-term incentive plan leads to overall growth
According to OpenBlock statistics, Arbitrum's short-term incentive plan (STIP), which has been running for several months, is considered successful, and various protocols have achieved comprehensive growth in the number of daily active users (DAU), TVL, and trading volume. For example, DEX has increased DAU by 118.72%, TVL by 49.24%, and trading volume by 333.28%.
STIP was originally planned to have two rounds, but the budget of 50 million ARB was used up in the first round. There are many new projects on Arbitrum, and some projects that intended to apply in the second round missed the opportunity. Therefore, the current pilot program can replace the second round of STIP, and projects that have not received STIP and Backfund incentives can apply for the current pilot program.
At the same time, the initial STIP had some shortcomings, and the pilot program will be improved during implementation, and the experience learned will also be beneficial to future long-term incentive programs.
Improvements to the pilot program
The pilot program will be more flexible in the use of ARB incentives. STIP has imposed strict restrictions on the incentive mechanism for factors such as limiting the sale of ARB, resulting in most protocols issuing ARB incentives in a conventional liquidity incentive model. The pilot program will provide greater flexibility and encourage protocols to explore and experiment with diverse incentive schemes to better serve the Arbitrum ecosystem.
The pilot program also introduces roles such as committees and application advisors. In the STIP vote, each representative needs to vote on hundreds of projects that apply, and in fact, it is impossible for representatives to be familiar with every project, which leads to a huge workload for each representative. This pilot program will set up a committee of 5 people approved by the DAO to conduct a preliminary evaluation of the application projects to ensure that only worthy projects will enter the Snapshot vote.
In response to the problem of insufficient feedback received by STIP response proposals, the pilot program introduced the role of application consultant to provide detailed feedback and guidance to each applicant, ensuring that each applicant can make improvements based on the feedback and thus propose a more attractive plan.
5 stages of the application process
The protocol applying for the pilot program will go through five stages: reward application, feedback, screening, voting, and incentives:
Application Period (2 weeks): Protocols use the Pilot Program Application Template to submit their proposals, ensuring that all applicants apply to the same criteria and objectives.
Feedback period (2 weeks): Application consultants provide feedback and guidance for each proposal, and the protocols revise their proposals within two weeks based on the feedback received.
Screening period (1 week): The committee will evaluate each agreement using a predetermined scoring criteria to determine which agreements will proceed to the voting phase.
Voting period (1 week): DAO members vote on each proposal that passes the initial screening to decide whether to allocate funds to it.
Incentive Period (12 Weeks): Approved protocols will receive biweekly allocations of ARBs through the Hedgey Stream for 12 weeks.
During the upcoming Tally voting period, the committee and application consultants will begin to create specific scoring criteria. So it is expected that it will take more than one and a half months to confirm which protocols will be incentivized and how to incentivize them.
Additional rewards for participants
In the proposal, 45 million ARB is allocated for incentives, and the unused portion will be returned. In addition, 815,000 ARB is allocated for members who participate in the work.
Committee members were allocated 125,000 ARBs, 25,000 each;
Application consultants: 105,000 ARB, 35,000 ARB each;
Research bounties total 200,000 ARB;
Data and analytics providers 150,000 ARB;
Project Manager 100,000 ARB;
Members who helped create proposals will be allocated 15,000 ARBs;
Retroactive community funding of ARB 100,000;
Multi-signature distribution 20,000 ARB, 2,500 ARB per person.
For researchers, you can try to apply for research bounties. You need to help DAO draw meaningful conclusions from incentive programs, such as which protocol incentive designs are most effective, what is the appropriate budget for long-term incentive programs, and which types of protocols receive the most funding.
Regarding retroactive community funding, Stablelab (an organization that provides professional representation, governance framework design, and product development to DAOs) said in its proposal that it would only be used to fund community members who contributed during the pilot program, and that there may be additional benefits to actively participating in the pilot program.
It should be noted that although the Snapshot vote has passed, an on-chain vote on Tally will be required to confirm the allocation of funds. PANews will continue to explain to you after the allocation of 45 million ARB is confirmed.
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