In a surprising turn of events, Arbitrum DAO Growth Management Committee (GMC) has faced a lot of criticism from market participants.
According to The Block report, the community reacted negatively to the Arbitrum DAO Growth Management Committee’s (GMC) recent proposal to invest 7,500 ETH in three non-Arbitrum native protocols: Lido, Aave, and Fluid.
The main bone of contention for the market and DAO representatives remained that the idea neglected native initiatives in the Arbitrum ecosystem.
In order to investigate yield-bearing prospects for the Ethereum Layer 2 network’s ETH assets, Arbitrum’s DAO last year formed the GMC and a distinct three-member Treasury Management Committee (TMC).
Arbitrum Growth Proposal to Invest in Non-Native Projects Draws Strong Criticism
Recently, the Arbitrum DAO Growth Management Committee (GMC) suggested allocating 7,500 ETH to the Lido, Aave, and Fluid protocols—three non-Arbitrum natives.
The Arbitrum community has strongly opposed this plan, with a number of DAO representatives voicing their disapproval of the ruling. The investment plan’s detractors contend that it ignores the potential of native Arbitrum ecosystem projects, which stand to gain more from such a large investment.
The plan has sparked debate over whether it makes sense to prioritize external expansion over bolstering Arbitrum’s internal ecosystem by concentrating on well-established non-native platforms. Advocates of Arbitrum-native initiatives worry that this action could hinder ecosystem innovation and jeopardize the larger objective of promoting Arbitrum-based solutions.
The dispute draws attention to an increasing conflict between fostering Arbitrum’s internal growth and increasing its visibility in the larger DeFi space. The Arbitrum DAO must strike a balance between ecosystem sustainability and outside investment as the discussion goes on.
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DAO Representatives Voice Against Growth Proposal
The Block via its report highlights that some Arbitrum DAO members criticized the GMC’s proposals, pointing out at least 10% of the cash should go to local protocols. Next Thursday, the idea will be put to a vote, making many curious about the stability of the proposal.
The Block quoted Delegate ‘JoJo’ who responded to the proposal by saying, “It is quite strange that out of 7,500 ETH, we couldn’t even allocate 10% spread in other protocols, even to give outside a signal that the DAO is here to support you, builder that decides to come to Arbitrum instead of going to Base to enjoy the support of Coinbase or to Solana to be part of the biggest casino in the world.”
Additionally, in an X post, ‘ultra’—another Arbitrum delegate—expressed his dissatisfaction with the plan, claiming that the choices “signaled that none of the Arbitrum native projects are good enough.”
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