The #Arbitrum Foundation faces community backlash over the retention of 700 million ARB tokens, prompting a proposal for their return. The proposal is currently up for voting until April 14th.
In March, the Arbitrum Foundation transferred 700 million ARB tokens without the community's consent, leading to community members initiating a new proposal. The proposal urges the foundation to return the tokens to its #DAO Treasury before proceeding with its budget plan.
The community believes that returning the tokens would demonstrate that the governance holders are ultimately in control of the DAO, rather than the service provider or the foundation. Voting on the proposal will end on April 14th, and as of now, 55% of voters support the proposal, while 42% are opposed, and 2% abstained.
In late March, a conflict between Arbitrum's foundation and its community began after the foundation proposed its first governance plan (AIP-1). The proposal suggested financing its operations with 750 million ARB tokens, valued at almost $1 billion.
After facing criticism from members of the community, the Arbitrum Foundation claimed in an April 2 forum post that its first governance proposal (AIP-1) was not a proposal but rather a ratification. The foundation also admitted to selling some of the tokens for stablecoins, and acknowledged that its initial attempt at governance failed due to communication issues and poor articulation of decisions.
In an attempt to improve community relations, the foundation later released two new improvement proposals: AIP-1.1, which outlines a smart contract lockup schedule, spending, budget, and transparency, and AIP-1.2, which suggests changes to the current founding documents and lowers the proposal threshold from 5 million ARB tokens to 1 million ARB tokens to increase accessibility to governance.
Despite these efforts, the issues with ARB holders persisted. According to the proposal, "The foundation has unilaterally been allocated $750M tokens from the DAO that was not approved by the governance tokenholders. Any funds must be returned until it has been properly allocated by the DAO and the DAO only." Voting on the proposal will end on April 14th.
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Source: cointelegraph
