Abstract
This proposal introduces the STIP Bridge, aiming to sustain and enhance Arbitrum's market leadership by extending support to key protocols amidst intense competition from other Layer 2 solutions.
It serves as a strategic interim solution, maintaining incentive alignment and ensuring continuous engagement of vital projects within the Arbitrum ecosystem until the Perpetual Incentives Program is initiated.
Motivation
The Arbitrum ecosystem is currently facing unprecedented competitive pressures, with significant incentive programs launched by rival Layer 2 networks threatening to attract our established protocols away.
The STIP Bridge is crucial for retaining these integral projects, ensuring they remain committed to Arbitrum by providing timely, targeted incentives. This initiative is essential to preserve network growth, user engagement, and overall ecosystem stability in a highly dynamic market environment.
Rationale
Aligning with Arbitrum's mission to support and nurture its development community, the STIP Bridge embodies our commitment to our builders and their contributions. It strategically addresses the imminent risk of losing key ecosystem participants to competitors by offering a seamless transition in incentive support. This approach not only retains critical projects and liquidity within Arbitrum but also sets a solid foundation for the impending comprehensive Perpetual Incentives Program, reinforcing our long-term vision of innovation and community empowerment.
Specifications
Eligibility
- Any protocol funded under STIP is eligible to apply for a bridge grant coinciding with the LTIPP distribution window.
- This will allow Arbitrum to ensure protocols that had success during the STIP campaign can retain their users and continue to focus on building on Arbitrum.
Maximum Funding Size:
Maximum funding requests under this bridge grant are capped based on a percentage of the prior funding received under STIP:
- Greater than 500k ARB: may make a funding request of up to 50% of their prior funding.
- Less than or equal to 500k ARB: may make funding requests up to 100% of their prior funding, capped at 250k ARB.
Addendum on STIP Forum post:
After applying with an addendum on the respective project’s original STIP forum post, projects will be included in a list of all extension applicants. Specifically, a project should add the tag “STIP Bridge” to the end of their forum post. The addendum is intended to be relatively lightweight, not requiring a full STIP type proposal but should still include:
- Requested amount (protocols have the option to size down their asks if they deem it more appropriate, including to help secure the support of delegates).
- Data on the performance of their activities during STIP.
- If the intended use of incentives is different than STIP, then details of the updated usage.
- Links to bi-weekly STIP performance reports and Openblocks Dashboard.
Voting and Approval Mechanism:
Optimistic Approach
An optimistic voting mechanism will be used to mitigate the potential for delegate fatigue from voting on 50+ proposals while still holding projects accountable for their overall performance within STIP and in general.
This optimistic model hopes to reduce the load on all delegates but ensure that the DAO's full attention is placed on the more contentious proposals.
Voting Mechanism
The current snapshot and the immediately subsequent Tally vote will earmark funds to allow the DAO to distribute up to the maximum permissible grants.
After applying with an addendum on the respective project's original STIP forum post, all properly submitted projects will be included in a list of extension applicants for consideration to be funded.
During the challenge review period, any delegate with at least 500K ARB delegated can put up a forum post and an associated snapshot proposal that will result in a full DAO vote for the individual grant streams for it to be approved.
Delegates may seek a full DAO vote at their own discretion if they believe that a project did (a) not fulfill their STIP requirements, (b) failed to deliver tangible results during the STIP period or (c) the amount sought in the bridge application would not result in an effective utilization of the DAO’s funds.
This will allow the DAO delegates to focus their available attention to more closely examine contested applications. To be accepted into the bridge program alongside the unchallenged proposals, the proposal to fund must receive a supermajority (66%) of votes in favor.
Steps to Implement
- Send funds to STIP multisig
- Create an addendum template for applicants
- Have applicants post addendums
- Conduct DAO challenge vote on Snapshot
- Conduct individual Snapshot votes for any challenged application
- Have successful applicants complete compliance
- Start streams at the same time as LTIPP protocols
- Monitored incentives throughout the program as done in STIP
Timeline
This is a rough timeline. We aim to start the STIP Bridge at the same time as LTIPP.
- Week 1 (March 11 - 17)
- Posted to Governance Forum
- If requested, Community Call including discussion of Voting Mechanism
- Week 2 (March 22 - 29)
- Snapshot Vote for the creation of Bridge Program
- Week 3
- Tally Vote for establishing funding to LTIPP or community multisig (17 days)
- Start of 2-week window for protocols to submit addendums, protocols are encouraged but not obligated to submit early to allow delegates time to review
- Week 4
- Continue addendum submissions
- Week 5
- One week Optimistic Approval / Challenge Vote Period
- Week 6
- Tally vote ends (17 days)
- Review and discussion period of remaining protocols not cleared in Optimistic / Challenge voting
- Vote on remaining contested applicants
- Week 6
- STIP.b & LTIPP incentives start at the same time
Overall Cost
Incentives Budget:
37,025,522 ARB
See estimated amounts here
The incentives budget above is the maximum allocation earmarked, any extra funds not used due to ineligible asks, projects not applying, or other reasons returned to the multisig.
Overhead: 0M ARB
- Assumed to be the same data provider and multisig as STIP without added cost.
- Analytics: This proposal should result in no material increase in work for the analytics vendor, given that the same team already covers STIP protocols, was mandated for making dashboards for the same, and is mandated for the entire time of LTIPP. Additionally, the multisig signing can be done at the same time as other disbursements or will use oSnap reducing the need for multi-sig signing.
- If there is an objection, a volunteer multisig from the DAO will be assembled and community grants can be allocated by the LTIPP special grants for taking over the existing dashboards from STIP, as they are open source and IP rights if any already resides with the DAO.
Proposers:
Includes some proposers and developers of both STIP round 1, Backfund, LTIP and an LTIP Council member.
Alex Lumley of SavvyDao, Dan Peng of Vela Exchange, CoinflipCanada of GMX
