Arbitrum, a layer-2 blockchain for Ethereum, recently announced that it would distribute Ether valued at approximately $6.2 million to its decentralised autonomous organization (DAO).
The DAO will collect base fees and surplus revenue from network transactions, totaling 3,352 ETH. DAOs are owned and managed by members and make decisions through group voting. Arbitrum is a popular scaling network for blockchain developers and decentralised applications, with users paying a fee during transactions.
Big news Arbinauts!
Arbitrum is the only rollup that sends all surplus revenue generated by transaction fees to their respective DAO and it is time for the DAO to collect the funds so far!
Follow along to learn more about it.🧵👇
— Arbitrum (💙,🧡) (@arbitrum) May 10, 2023
Each fee paid on Arbitrum One is divided into two sections, the L1 fee and the L2 fee. A revenue breakdown reveals that the DAO will receive surplus funds from the L1, base, and L2 fees. The proposal will create a mechanism for revenue distribution, with delegated ARB tokens eligible for distribution.
The move will give ARB a purpose beyond a worthless governance token, according to Arbitrum, aligning community incentives. However, some members expressed concern that the revenue distribution could classify the ARB token as a security.
The incentive program was launched after a fund transfer of almost $1 billion that was not approved by ARB holders, leading to a clash with the community.