After receiving the airdrop, how to participate in Arbitrum DAO governance?
This article will outline the governance of Arbitrum, the Arbitrum DAO, and the process of initiating proposals and voting.Written by: Heimi, Baize Research Institute
With the first improvement proposal of Arbitrum published on the community forum, the governance process of Arbitrum DAO is gradually being refined. This article will outline the governance of Arbitrum, Arbitrum DAO, and the process of initiating proposals and voting.
Before we begin, here are some relevant concepts:
AIP: Arbitrum Improvement Proposal
AIP-1 (Arbitrum Improvement Proposal 1): Arbitrum proposal framework
Chains managed by Arbitrum DAO: Arbitrum One and Arbitrum Nova chains, as well as any other chains authorized by Arbitrum DAO
DAO Treasury: 42.78% of $ARB is held in smart contracts directly managed by Arbitrum DAO and the Arbitrum Foundation through on-chain voting mechanisms.
Governance Chain: Chains approved by Arbitrum DAO, managed by $ARB tokens
Non-Governance Chain: Any chain approved by Arbitrum DAO that is not managed by $ARB tokens
What is Arbitrum DAO?
Chains like Arbitrum One have a concept of a "chain owner." The "chain owner" acts as the administrator of the chain, responsible for making changes to the system. More specifically, the "chain owner" can modify core system parameters, pause transactions, and most importantly, update any contracts that define and execute the core protocol.
Clearly, the ability to arbitrarily change Arbitrum chain parameters gives the "chain owner" significant power. Therefore, it is necessary for Arbitrum to decentralize this role further.
Arbitrum distributes ownership to various parties in the Arbitrum ecosystem, including development teams, investors, protocols, and users, by airdropping governance tokens $ARB. All holders of $ARB form the Arbitrum DAO, which manages all chains of Arbitrum and their corresponding chain owners.
Arbitrum DAO will be able to initiate Arbitrum Improvement Proposals (AIPs), which members can vote on. If a proposal passes, the "chain manager" will bring it to reality.
Arbitrum DAO consists of three parts:
The Arbitrum DAO governance contract is implemented on-chain, allowing DAO members to vote on AIPs using $ARB.
Arbitrum DAO has a built-in funding contract, known as the "treasury," for the ongoing development and maintenance of the protocol. DAO members can propose and vote on how to use treasury funds.
Arbitrum DAO also has a built-in security mechanism, the "Security Council." The Security Council is an entity responsible for ensuring the safety and integrity of the DAO and the Arbitrum chain, capable of taking swift action in emergencies, bypassing the slow voting process. Members of the Security Council are elected by the DAO every six months.
Values behind Arbitrum DAO:
Alignment with Ethereum: Arbitrum sees itself as a participant and builder within the Ethereum community;
Sustainability: Ensuring the sustainability of the protocol, always driving decisions regarding technology, economics, and resource allocation rather than short-term gains;
Security: When considering any protocol changes, the security of the system should be a primary consideration;
Inclusivity: The community should be open and welcoming to everyone;
User-Centric: For the common benefit of all users;
Neutral and Open: Voting governance is not about "winning or losing," but rather promoting openness, innovation, interoperability, user choice, and healthy competition on the Arbitrum chain.
In the governance process of Arbitrum, there are four main participants:
$ARB token holders: Individuals who have the ability to propose, vote, and implement actions regarding chains approved by Arbitrum DAO.
Directors: Since the Arbitrum Foundation is located in the Cayman Islands, at least one director is needed to manage and operate (especially related to contractual arrangements, such as representing the foundation and signing contracts).
Security Council: 12 members of a multi-signature wallet (9-12) capable of executing the voting results of Arbitrum DAO and taking emergency actions, responsible for maintaining the Arbitrum chain.
Special Grants: Distributed by the Arbitrum Foundation.
There are two types of AIPs: Constitutional AIPs and Non-Constitutional AIPs.
Constitutional AIPs include:
• Modifying DAO rules
• Software updates: Installing or modifying any software on the chain;
• Core: Taking any actions that require the "chain owner";
• New chain approval: Approving a new chain. (Governance chains and non-governance chains)
Non-Constitutional AIPs include:
• Funding: Proposing how to spend or allocate funds from the DAO treasury;
• Information: Providing guidance or information to the community.
Like Internet Computer, Arbitrum's governance is conducted entirely on-chain and is binding. In contrast, some other protocols typically allow users to vote on Snapshot and then delegate the implementation of changes to multi-signature developers.
However, this method does not always ensure that all improvement proposals are ultimately implemented, resulting in lower efficiency compared to centralized implementation.
The proposal and voting process for AIPs consists of seven steps:
Phase 1------Temporary Check (1 week):
Propose suggestions on the community forum and discuss/debate for 1 week.
Proposers can create a vote on Snapshot to gauge community interest in the proposal.
Phase 2------Formal Submission of AIP (3 days):
After the temporary check, proposers submit the AIP through the governance contract on Arbitrum.
Proposers must have an address that has delegated at least 5 million $ARB.
Phase 3------DAO Votes on AIP (14-16 days):
Arbitrum DAO will be able to vote directly on-chain on the submitted AIP.
The AIP will pass if the following conditions are met:
• "Yes" votes are the majority (threshold 1);
• For Constitutional AIPs, at least 5% of $ARB must vote "Yes"; for Non-Constitutional AIPs, at least 3%.
If the AIP passes, it moves to phases 4-7; otherwise, the AIP will move to phase 4 and then to phase 7.
Phase 4------L2 Waiting Period (3 days):
After phase 3, there is a 3-day waiting period during which unpassed AIPs can withdraw funds;
Phase 5------Initiate and Complete L2→L1 Message (at least 7 days):
Send L2-to-L1 messages on Ethereum indicating that the AIP has passed.
Phase 6------Waiting Period (3 days):
Ensure that voting users have time to withdraw before the AIP takes effect.
Phase 7------Execute and Implement AIP
On average, the process for Constitutional AIPs takes about 37 days from temporary check to final execution, while Non-Constitutional AIPs typically take 27 days.
No time to participate, how to delegate voting?
If you do not have the time or resources to participate in the governance of the DAO, you can express your opinion by delegating your voting rights to others.
It is crucial to choose someone who aligns with your values and whom you trust.
To delegate voting rights, you need an Ethereum wallet holding $ARB. Once your wallet is set up, you can follow these steps:
Go to the Arbitrum DAO page on Tally, which is the decentralized governance tool used by Arbitrum DAO.
Click "Connect Wallet" to connect your wallet to Tally.
Click the "Delegate" button in the top menu.
Search for the delegate you want to assign by entering their Ethereum address or name in the search bar.
Click the "Delegate" button next to your chosen delegate.
Click the "Delegate" button in the pop-up window to confirm the delegation.
Wait for the transaction to be confirmed on the Arbitrum One network.
Overall, Arbitrum DAO is a powerful tool that facilitates decentralized governance and community management within the Arbitrum ecosystem. By holding $ARB tokens and participating in the governance process, individuals can have a direct impact on the future of Arbitrum and even Ethereum.
With the $ARB airdrop taking place, the governance of Arbitrum will officially transition to the Arbitrum DAO, marking a formal step towards decentralized governance.
