[Updated] Proposal to Establish the Arbitrum Research & Development Collective

This is a non-constitutional proposal.

Amendments in light of community feedback:

• Standard 50,000ARB for the DAOAdvocate role due to the important nature of the role re. the ARDC.
• Added detail re. clawback functions on [Multi-Sig] + [Service Provider Streams]
• Created the ArbitrumDAO ARDC [Clawback Capability] Governor via the Zodiac Governor Module: Tally | ArbitrumDAO ARDC [Clawback Capability]

Abstract - This proposal aims to fund the Arbitrum Research & Development Collective to aid in turning Arbitrum DAO members’ ideas into reality for a term of 6 months.

Motivation - The ARDC’s role in reviewing and enhancing governance proposals, conducting code reviews for security, providing quantitative analysis for economic risk, and fostering active delegate engagement will contribute significantly to the growth and success of the Arbitrum ecosystem. It will provide valuable tools and reports for proposal authors, helping them refine their ideas and make better-informed decisions.

Rationale - the ARDC’s primary mandate aligns with the strategic priorities of the ArbitrumDAO, particularly in terms of governance optimization, risk management, research, and security. By funding the ARDC, the ArbitrumDAO can enhance its governance framework and future-proof the ecosystem through specialized verticals dedicated to these critical areas.

Steps to Implement - Steps to Implement - The AIP moved to Snapshot on the 11th of December 2023. Following the conclusion of the Snapshot vote, the AIP will then proceed to the on-chain voting stage so as to ratify the funding & process for the Arbitrum Research & Development Collective. Once the forecited steps are concluded, @Immutablelawyer will be announcing the starting date of the election process.

Link to passed Snapshot proposal: https://snapshot.org/#/arbitrumfoundation.eth/proposal/0xf49d88ec2f4fa7373efc66a7cf9441d916519f48a2d90e7db3ea688357150a44

Specifications & Timeline - Specifications & timeline can be found in the following sections.

Total Cost -

Total: 1,761,000 ARB

665,000 ARB [Security] [Applicable Cap]

665,000 ARB [Research] [Applicable Cap]

335,000 ARB [Risk] [Applicable Cap]

50,000 ARB [DAOAdvocate]

1,000 ARB [per signer - per month for the 6-month term] [Multi-Sig Budget]

USD16,000 payable in ARB - ImmutableLawyer [as retroactive payment for Research, draft and reviews of of the ARDC Proposal + Coordinating individually across stakeholders, community members & delegates] + management & administration of the pre-election application process & the election process itself until all members are appointed & the ARDC is fully operational. as envisaged in this proposal.

[Excess ARB which will not be utilised will be returned to the ArbitrumDAO Treasury]

Arbitrum Research & Development Collective [ARDC]

Non-Constitutional

Defining ‘Arbitrum Research & Development Collective’ or ‘ARDC’: An alliance for combined action used to achieve a common goal in the best interests of the ArbitrumDAO

TL;DR

• This proposal aims to fund the Arbitrum Research & Development Collective to aid in turning Arbitrum DAO members’ ideas into reality for a term of 6 months.
• This proposal intends on forking the Arbitrum Coalition proposal that was submitted & spearheaded by Blockworks Research, Gauntlet & Trail of Bits on the 25th of October 2023 (Proposal: The Arbitrum Coalition 11). The proposal failed the Snapshot temperature check submitted on November 3rd 2023 (Snapshot 7);
• Alignment to the ArbitrumDAO Strategic Priorities:

1. The ARDC’s mandate will naturally aid in ‘Governance Optimization’ through research & development of tooling related to the ArbitrumDAO’s governance framework.
2. The ARDC’s mandate will aid in future-proofing the ArbitrumDAO by virtue of its member-specific verticals re. Risk, Research & Security.

• This proposal intends on improving on the Arbitrum Coalition proposal by implementing an election mechanism to choose the service providers that may participate in the Arbitrum Research & Development Collective;
• This proposal intends on implementing a set of legally enforceable checks & balances to regulate the internal operations of the Arbitrum Research & Development Collective;
• The ARDC will be made up of the following members [Subject to change following forum post feedback]: The DAOAdvocate, Risk Management-Oriented Members, Security-Oriented Members, Research-Oriented Members.
• Fund the ARDC for a 6-month term.

Background - Perspective

The Arbitrum Coalition was an organization initially made up of Blockworks Research, Gauntlet, and Trail of Bits. The Coalition aimed to execute turnkey R&D work on behalf of the Arbitrum DAO. The Coalition’s mandate was to help steer the path from ideation in the forum to the optimal, efficient, and safe execution of proposals. In other words, being a steward in making the DAO’s visions a reality. The coalition would have provided the necessary resources so that the ArbitrumDAO can make informed decisions.

The Arbitrum Coalition proposal received a lot of feedback from delegates, community members and contributors alike. In general, the general consensus was that the Arbitrum Coalition was a great theoretical idea & would have provided a great value-add to the Arbitrum Ecosystem. However, it lacked optimal execution in relation to its structural mechanics, especially mechanics re. the appointment & policing of service providers.

This proposal forks the Arbitrum Coalition proposal by iterating & optimizing on such proposal. Hence, certain parts of the proposal will be similar or identical.

The Arbitrum Research & Development Collective [Why?]

The Arbitrum forum is host to numerous commendable proposals, discussions & ideas. These Forum posts frequently lack the pre-requisite research, coordination, design, and risk evaluation mechanisms necessary for them to result in net-positive progress for the Arbitrum Ecosystem.

For instance, the iterative refinement of proposals, the cultivation of delegate awareness & participation at the Forum & voting stage, and the identification of suitable partners to execute an idea often present formidable challenges for proposers themselves (especially when they are newer entrants to the ArbitrumDAO). The primary mandate of the ARDC will be that of providing objective assessment of governance posts by distilling information and expediting governance decision-making; thereby enabling participants in the ArbitrumDAO to make better-informed choices.

The ARDC aims to possess unparalleled expertise by having an established dedicated team capable of executing this initiative. Ideally, all of the ARDC members would have made significant contributions to the ArbitrumDAO. The subject-matter areas that the ARDC Verticals aim to cater for include, but are not limited to:

• Governance Proposals;
• Research;
• Framework Development;
• Risk Assessment;
• Secure Code Reviews;
• Threat Modeling; and
• Testing Enhancements.
• Retroactive Analysis Of Passed Initiatives

In our opinion, the forecited subject-matter areas would provide the ArbitrumDAO with the necessary resources so as to ensure that ARDC members provide the ArbitrumDAO with a holistic execution of the ARDC mandate.

Mandate of the Arbitrum Research & Development Collective (ARDC):

Forum Proposal Review & Assistance:

• Objective Reporting: The impartial data-driven research conducted by ARDC aids delegates in making well-informed decisions by offering a comprehensive understanding of proposal contexts and competitive landscapes.
• Proposal Improvement Tooling: These reports double as valuable tools for proposal authors, helping them enhance their work by incorporating feedback and addressing shortcomings. In this regard, the ARDC will serve as an assistant to proposers on an on-request basis to optimize & structure proposals that could prove to be a value-add to the Arbitrum Ecosystem.

Review on Chain Proposal Code Updates:

• Enhanced Security: Through manual and automated code reviews, ARDC ensures a rigorous white-box security assessment, identifying design flaws and security issues, thus bolstering the integrity of the ecosystem.
• Audit Executables (eg plutus dao community created staking contracts)

Quantitative Assistance:

• Quantitative Analysis: The ArbitrumDAO needs an element of quantitative rigor added to proposal evaluations, offering insights into economic risk, design optimization, and overall proposal viability.
• Risk Mitigation: This service assists the ArbitrumDAO in identifying and mitigating economic risks associated with proposed initiatives, promoting sound decision-making.

Project Management [On a Request-Basis]:

• Efficient Coordination: The ARDC aims to assist in facilitating effective communication & management of proposals between the ArbitrumDAO, stakeholders, and service providers.

In addition to the aforementioned services, the ARDC aims to offer the following benefits:

Tooling Creation and Enhancement:

• Security Enhancement: Developing and enhancing tools for security assessment strengthens the integrity of the Arbitrum ecosystem, ensuring proposal code updates meet stringent security standards.

Research New Mechanisms:

• Innovative Contributions: ARDC will objectively analyze and contributes to the development of innovative mechanisms, promoting data-driven decision-making and enhancing the ecosystem’s capabilities.

Delegate Engagement:

• Active Participation: ARDC’s processes incentivize delegates to actively contribute to proposal refinement, fostering a more engaged and collaborative governance community.

Growth Initiatives:

• Community Expansion: Through content creation, including podcasts, Twitter threads, and newsletters, ARDC attracts developers and users to the Arbitrum ecosystem, promoting growth and awareness.

In summary, the services provided by the Arbitrum Research & Development Collective(ARDC) serve to enhance governance decision-making, security, transparency, and community engagement within the Arbitrum ecosystem, ultimately contributing to its continued growth and success.

Arbitrum Research & Development Collective - Specifications of Verticals [Risk, Research, Security, DAOAdvocate]

The DAOAdvocate

The DAOAdvocate will be a single designated person (Legal/Natural) that will represent the ArbitrumDAO & maintains the ability to direct the ARDC’s efforts; Functions as the bridge between the ArbitrumDAO and the ARDC. The DAOAdvocate will be elected via Snapshot. The advocate will receive a stipend per month as per his ask in the application submitted to the DAO pre-election. The advocate’s main responsibility is ensuring that the Arbitrum DAO’s best interests are met by the ARDC & that the ARDC acts in accordance with its mandate & purposes.

If a member of the ARDC is deemed to have acted negligently, in bad faith, or contrary to the mandate/purposes of the ARDC as ratified by the ArbitrumDAO, the DAOAdvocate will have a legal obligation submit a proposal via Snapshot to terminate such a member of the ARDC together with the necessary details that justify such termination. Following this, the DAOAdvocate will have an ancillary legal obligation to submit a call for applications for the vacant ARDC seat. The decision as to who ought to take up the vacant seat will be determined by the ArbitrumDAO via the election mechanism stipulated in this Forum Post.

The Risk Member

The Risk member should ideally possess a range of skills. This includes a strong quantitative background for conducting thorough reviews, research, and modeling or simulations related to economic risk, design, and optimization. The Risk member is to provide the ArbitrumDAO [through the ARDC] with a comprehensive knowledge-base in relation to digital asset-focused risk identification, risk assessment & risk mitigation. The Risk member should ideally have experience re. risk-focused design, research, and modeling to determine how to incentivize usage, maximize economic efficiency, protect systemic protocol health, and plan for the future with rigorously validated insights.

The Security Member

The Security member should ideally possess skills in specific static analysis bug detection targeting code updates and developing fuzzing capabilities to validate upgrade states. They should be proficient in visualizing the state of governance contracts, ensuring correct encoding of values, and providing educational materials and guidelines for reviewing upgrade procedures. Additionally, they should have expertise in whitebox source code reviews, identifying design flaws, and ensuring security and correctness properties in on-chain upgrade proposals. This role is crucial for preventing governance attacks and may involve building tools and educational materials to support proposal reviews when no code review is required.

The Research Member

The Research member should ideally possess a range of skills, including the ability to conduct objective analysis and contribute to the design of various mechanisms such as sequencers, fraud proofs, and data availability solutions, with a strong emphasis on objective data-driven research. They should also be proficient in creating processes that incentivize active delegate participation, such as developing delegate incentives frameworks and hosting regular collaborative calls. Additionally, they should be skilled in content creation to promote the Arbitrum ecosystem’s growth. Moreover, the candidate should have a knack for producing impartial, data-driven research to aid delegates in making informed decisions and improving proposal quality. Excellent communication skills and the ability to manage interactions with DAO stakeholders and service providers are essential, along with the capacity to document ARDC activities and recommend solutions for any issues that arise, maintaining a governance process for continuity.

Arbitrum Research & Development Collective [Elections]

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We propose adapting section 4 of the ArbitrumDAO Constitution & optimizing it to apply to the election for ARDC Members [REF: The Amended Constitution of the Arbitrum DAO | Arbitrum DAO - Governance docs 3]. Hereunder, we propose an adapted model of Section 4 of the ArbitrumDAO Constitution to implement to the ARDC Elections.

The ARDC election process is scheduled to begin 3 business days from the ratification of the on-chain proposal.

The date chosen for the first election will form the basis for all future elections. Every election should begin 6 months after the previous election has been finalized.

All ARDC members are expected to serve their term unless terminated by the ArbitrumDAO through Snapshot as stipulated in the Agreement regulating the ARDC [Further details below re. the Agreement & Defining provisions].

There will be four separate elections per vertical based on the intellectual need of the ARDC:

1. The DAOAdvocate;
2. Risk Management-Oriented Member;
3. Security-Oriented Member;
4. Research-Oriented Member.

The following timeline governs an election process that starts at time T [‘T’ means the date that the on-chain vote passes +3 days]:

Governing Rules

• Applicants may only apply for 1 Role during the election process;
• Joint applications are permissible under the following conditions:

1. Joint applications must abide by the applicable cap to the corresponding seat to be applied for as voted by the ArbitrumDAO;
2. An applicant may not apply as part of a joint application with other applicants & then proceed to apply individually for another seat.

• The Fee Structure/Ask must not exceed the applicable cap as voted by the ArbitrumDAO.

Election Process

1. Application Submission (T+7 business days):

Anyone may submit an application on a dedicated page on the ArbitrumDAO Forums in conformity with the application template;

2. KYB/KYC + Delegate Review Period (7 business day period following end of Application Submission Period):

Applicants who would have validly submitted their applications in conformity with the application template will then be required to undergo KYC/KYB processes. All candidates will cooperate with the Arbitrum Foundation and complete the compliance process. The Arbitrum Foundation is responsible for removing any candidates that fail the compliance process. Only applicants that pass KYB/KYC will be eligible for election.

3. Amendment Period (3 business day period following the end of the KYB/KYC + Delegate Review period whereby applicants may amend their application):

Applicants may amend their applications in light of community feedback during this time period.

4. Member election (7 business day period following end of Amendment Period):

A Snapshot with rank-choice voting will be put up per vertical including the list of all eligible candidates:

1. Snapshot for DAOAdvocate election;
2. Snapshot for Risk Management-Oriented Member election;
3. Snapshot for Security-Oriented Member election;
4. Snapshot for Research-Oriented Member election.

The ArbitrumDAO may approve and implement a Non-Constitutional AIP to change the rules governing future ARDC elections, but the AIP process may not be used to intervene in an ongoing election.

Election Application Template

For the fee-cap applicable to the role being applied for, please refer to the Funding section. Applicants requesting asks exceeding the corresponding cap will be contacted to amend accordingly.

Applicant Information

Name of Applicant & Applicant’s Representative [If Applicable]:

Email Address:

Telegram Handle (if applicable):

LinkedIn Profile (if applicable):

Role being applied for [1 Max] [DAOAdvocate, Risk Management-Oriented Member, Security-Oriented Member, Research-Oriented Member]:

Background Information [Applicable to all]

Please provide a brief overview of your experience in the digital asset industry and, more specifically, Ethereum & Arbitrum Ecosystems. Include any relevant projects, contributions, or roles within the ArbitrumDAO, if applicable. (400 words max)

Specify the subject-matter area(s) you are interested in contributing to within ARDC (e.g., Research, Framework Development, Risk Assessment, etc.). Explain why you believe your skills align with the chosen area(s). (500 words max)

Objectives & Motivation [Applicable to all]

What motivates you to join ARDC, and what do you hope to achieve as a member? (300 words max)

Explain how you envision contributing to the primary mandate of ARDC, which is to provide objective assessment of ArbitrumDAO Forum proposals & discussions and expedite governance decision-making within the Arbitrum ecosystem. (300 words max)

Skills and Experience [Applicable to all]

Provide details about your relevant skills and experience, including any previous work or contributions related to the subject-matter area(s) you are interested in within ARDC. (300 words max)

Proposal Review & Assistance [Applicable to all]

Share what approach you would implement to conducting objective research and providing assistance to proposers to enhance their proposals. (300 words max)

Review on Chain Proposal Code Updates [Only applicable to Security]

Describe your experience in conducting code reviews and assessing security risks. How can you contribute to enhancing the security and integrity of the Arbitrum ecosystem? (500 words max)

Quantitative Assistance [Only applicable to Risk]

Explain how you can bring quantitative analysis skills to proposal evaluations and contribute to identifying and mitigating economic risks associated with proposed initiatives. (500 words max)

Research Initiatives [Only applicable to Research]

Describe your experience conducting research-oriented initiatives within the digital asset industry, more specifically, research re. the Arbitrum-specific tech-stack. Explain how your previous experience can translate to an added value contribution to the ARDC & the ArbitrumDAO. (500 words max)

Project Management [Applicable to all]

Describe your project management experience. (250 words max)

Purpose/Mandate of the ARDC [Applicable to all]

How do you intend to objectively contribute to achieving the purposes/mandate of the ARDC? (500 words max)

Additional Contributions [Applicable to all]

How can you contribute to the creation and enhancement of tools for security assessment, the development of educational materials, research into new mechanisms, delegate engagement, and growth initiatives, as outlined in ARDC’s objectives? (500 words max)

Scope of Services & Applicable Fees [Detailed breakdown of fees including pricing model for the 6-month term] [Applicable to all] [Must not exceed applicable cap]

Please provide a detailed breakdown of the scope of services through which you will be contributing. Include the pricing model implemented & a description of expected hours + hourly rate (if applicable) & manpower dedicated to the ARDC.

Summary [Applicable to all]

In summary, please highlight your key qualifications and what you believe you can bring to ARDC. (400 words max)

Feel free to attach any relevant documents, portfolios, or links to previous work or contributions.

Checks & Balances

The ARDC will be regulated via an Agreement entered into by all elected ARDC Members with the Arbitrum Foundation serving as a counterparty to the Agreement.

The Agreement will be made public & include, but will not be limited to the following provisions:

Appointment & Termination: ARDC Members will be appointed via the forecited election process in accordance with ArbitrumDAO Consent by the Arbitrum Community.

• Arbitrum Community will be defined as follows:

“Arbitrum Community” means those persons who have the right to propose and vote on proposals ergo, the token holders of the ARB token with the following contract address [0x912CE59144191C1204E64559FE8253a0e49E6548] from time to time visible at [$2.03 | Arbitrum (ARB) Token Tracker | Arbiscan 1].

• ArbitrumDAO Consent will be defined as follows:

““ArbitrumDAO Consent” means a vote of the ArbitrumDAO Community in favour of a proposal satisfying the minimum requirements set forth at The Amended Constitution of the Arbitrum DAO | Arbitrum DAO - Governance docs 3 (as such minimum requirements set forth therein on the date hereof may be revised from time to time with ArbitrumDAO Consent) taken by any of the following means:

1. Snapshot (or any successor thereto); or

2. another mechanism, whether on or off a blockchain, that ensures only and all people voting hold or have been delegated blockchain-based tokens known as ARB."

Conflict of Interest Provision: ARDC Members will be bound to act in absolute good faith, utmost honesty, refraining from deriving unauthorized profits from their position & disclose conflicts of interest. ARDC members should always disclose any potential or actual conflicts of interests to the DAOAdvocate who will then proceed to mitigate the respective ARDC Member’s involvement in the task in relation to which such ARDC Member is conflicted.

To sum up, all ARDC Members must declare the nature and extent of any interest, direct or indirect, which the ARDC Member is aware that she, he or it has in a proposed task at hand.

Mandate & Purpose of the ARDC: The ARDC members are pivotal in executing the purposes of the ARDC, ensuring that the activities thereof align with the ARDC’s objectives and the stipulations of ratified proposal. Here, it is also a role of the DAOAdvocate, to see that this is actually being done and that activities within the ARDC will actually further or are in conformity with the purposes outlined in the ratified proposal.

Record-keeping and Reporting: Comprehensive and precise record-keeping is imperative. ARDC Members will be required to maintain detailed accounts and documentation of the ARDC’S internal operational workflow together with meeting minutes taken by the DAOAdvocate. Furthermore, periodic reporting is essential so as to keep the ArbitrumDAO updated re. Task-specific progress & internal ARDC Administration (such as which ARDC Member is working on which task & deadlines for the expected publication of tasks that fall in line with the purposes of the ARDC).

Duty of Impartiality: ARDC Members will have an obligation to act in an impartial manner in relation to their tasks & workflow, ensuring that the ARDC is not compromised by personal interests or external influences.

Obligation of Recusal: ARDC Members with a conflict of interest involving a project being reviewed by the ARDC should recuse themselves from participating in the evaluation and should vote Abstain if a proposal directly related to the ARDC is submitted. Additionally, ARDC members will abstain from commenting or voting on proposals made by any company that can be deemed a direct competitor.

Prohibition of Self-Dealing: Participants should refrain from voting on sending funds to themselves or organizations where any portion of those funds is expected to flow to them, their other projects, or anyone they have a close personal or economic relationship with.

Ethical Trading: Members are required to follow ethical trading standards in regard to ARB and any other relevant digital assets.

Operational parameters to be implemented

• Meeting minutes will be taken for every meeting and published on a public Notion site for review by the ArbitrumDAO;
• Monthly report detailing performance of the ARDC;
• Bi-weekly calls with the community in relation to the ARDC;
• Public Asana/Airtable dashboard to be utilized by ARDC members to submit updates on specific tasks and sub-tasks and thus, keeping the ArbitrumDAO in the loop.

We believe this eliminates information asymmetry while allowing ARDC members to conduct their work in the most efficient possible manner. For token holders and the community, they can quickly go to these operational dashboards and see ARDC progress. When research is released, it’s clearly defined who worked on it, amount of hours, and total project time.

Arbitrum Research & Development Collective [Multi-Sig]

The ARDC’s 3/5 multisig is being created. The funds in the multisig belong to the ArbitrumDAO and the signers act as Multi-Sig administrators on behalf of the ArbitrumDAO in coordination with the Arbitrum Foundation. Signers will receive 1,000 ARB per month for their contribution. Funds held in the multisig are explicitly banned from usage in ArbitrumDAO governance including delegation. The multisig includes:

• Sam [Gains Network]
• Matt [StableLab]
• ImmutableLawyer [Axis Advisory]
• Max [Connext]
• Brian [Gamma Strategies]

The ARDC multisig includes two features to ensure accountability of signers and members elected:

• Streaming of funds to elected members through Hedgey on a monthly basis. The ArbitrumDAO will maintain control over this stream and have the ability to cut it off with an on-chain vote as the ArbitrumDAO will be made the Grant Admin on the Hedgey module.
• Clawback capability as explained hereunder.

The Multi-Sig will grant the ArbitrumDAO the function to clawback funds from the ARDC Multi-Sig via the Zodiac Governor Module via the created ArbitrumDAO ARDC [Clawback Capability]: Tally | ArbitrumDAO ARDC [Clawback Capability] 1

In addition, after the ARDC Elections & thus, member appointment, the ARDC Multi-Sig members will utilise Hedgey to stream the respective funds to the elected members with the ArbitrumDAO being the Grant Admin thereof. The ArbitrumDAO’s Grant Admin role thus gives the DAO the ability to halt any streaming of funds to any member via governance.

Arbitrum Research & Development Collective [Term]

The duration of the ARDC’s mandate will be of 182 days [6 months] from the moment the on-chain proposal is approved. The ARDC may seek to identify and complete other initiatives for the ArbitrumDAO & the wider Arbitrum Ecosystem, depending on the changing needs of such ecosystem, at the discretion of the DAOAdvocate following consultation with the ArbitrumDAO via the ArbitrumDAO Forums.