A large majority of the Arbitrum community has voted against a proposal to return 700 million ARB tokens to the DAO treasury.
The controversial AIP-1.05 closed with 84% of voters using 118 million ARB tokens to vote against the proposal. Only 14.57% voted in favour of the proposal with 21 million ARB, while 1.42% abstained from voting altogether.
The results of the proposal have turned around quite significantly since it was first put forward on April 8. At the time, crypto researcher Eric Wall noted that more than 90% of voters appeared to be in favour of the proposal, which he believed was creating unnecessary turmoil in response to the Arbitrum Foundation’s use of unfortunate language in the first governance proposal – AIP-1.
AIP-1 became the subject of scrutiny when it was revealed that the proposal was intended to merely notify the community that 750 million ARB tokens would be in the control of the Arbitrum Foundation. After considerable backlash from the community, the Arbitrum Foundation released two subsequent proposals on how funds should be dispersed and pledged not to move the remaining 700 million ARB without the consent of DAO members.
AIP-1.05 called for the Arbitrum Foundation to return the 700 million ARB tokens to the DAO Treasury as a show of good faith – something that several members on Arbitrum’s governance forum described as an unnecessary “power play.”
“The proposal appears to be a symbolic gesture (as acknowledged by the proposer) that serves primarily as a power play. It does not outline subsequent steps, potentially jeopardizing the Foundation’s future if the DAO faces challenges in approving additional funding for any reason (such as lack of coordination or consensus),” said Krzysztof Urbański of L2Beat.
Several users also disagreed with another call to action proposed by AIP-1.05, which was for the Foundation to disclose the terms of a $10 million OTC deal with market maker Wintermute. Castle Capital founder “Atomist” said the firm disagrees with this action because it was likely to discourage private entities from doing business with Arbitrum in the future.