The Arbitrum DAO has made an announcement regarding the distribution of extra tokens to finance all projects approved in its recent Short-Term Incentive Program (STIP).
The Arbitrum DAO has made an announcement regarding the distribution of extra tokens to finance all projects approved in its recent Short-Term Incentive Program (STIP), resulting in a budget increase of $23.4 million.
The proposal, which underwent voting by the Arbitrum community between November 18 and December 2, aimed to provide additional funds to projects that had received grant approvals but were unable to secure funding due to the STIP's token cap of 50 million ARB. As a result of the successful vote, an additional 26 projects will receive 21.1 million ARB tokens, equivalent to $23.4 million.
With 216.7 million votes in favor and 73.1 million votes against, the supplementary capital was approved, raising the STIP's overall budget to 71.4 million ARB tokens. This funding round will support 56 projects, fostering an inclusive environment for emerging builders and promoting diversity.
Arbitrum serves as a layer-2 network designed to enhance transaction scalability on the Ethereum blockchain, facilitating faster and more cost-effective fund transfers. The protocol operates under the governance of ARB token holders and generates revenue through transaction fees.
The increased budget includes funding allocations for projects such as Gains Network (4.5 million ARB), Wormhole (1.8 million ARB), and Stargate Finance (2 million ARB). PancakeSwap withdrew its proposal for 2 million ARB tokens due to the Know Your Customer (KYC) requirements of the STIP.
However, the decision to provide additional funding was not without controversy. Delegates from the MUX protocol voiced opposition, arguing that it would result in a mixture of projects with varying levels of quality. They advocated for supporting proposals individually, based on strong protocol fundamentals, well-executed incentives, and reasonable grant sizes, rather than bundling them together.
Some members of the Arbitrum DAO suggested that a full second round of funding, instead of a backfund, would have been a fairer approach to including additional protocols in the incentives program.
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