Arbitrum DAO Passes $23M Backfund Proposal

The Arbitrum community passed a proposal to disburse millions of extra dollars towards projects that have been approved but not funded by its STIP.

The Arbitrum DAO concluded a community vote on Saturday, approving an additional 21.1 million additional tokens to fund projects that were approved for a grant under its Short-Term Incentive Program (STIP).

Some of the projects which received approval based on their proposals earlier this year failed to receive funds because of the STIP’s 50 million token budget.

On Dec. 2, the community voted in favor of the additional funding worth $23.5 million for 26 more projects, including Gains Networks, Stargate Finance, Synapse and Wormhole.

The proposal’s authors explained that a “Backfund” proposal would be a crucial catalyst for future grant structures, specifically to examine the impact that incentives have on the Arbitrum ecosystem. 

However, there was a fair amount of opposition from some members of the community, including those who received funding in the initial round. 

Arbitrum-based decentralized exchange (DEX) Camelot argued that voting on the initial proposal would have been significantly different if delegates had known in advance that their votes could be potentially carried forward into an entirely new situation.

“Votes were made under known parameters, and therefore taking them as valid into an entirely new circumstance sets a worrying precedent,” said Camelot in a comment on the proposal draft. 

MUX, a decentralized leveraged trading protocol built on Arbitrum, said that the 25-plus proposals in the backfund bundle were of “mixed quality,” and while some were worthy of support, others were questionable given their protocol fundamentals and incentive execution strategies.