Summary

• We propose Arbitrum foundation launch Arbitrum grants program with a budget of $1M spread across 2 quarters to fund a wide variety of teams building apps on top of Arbitrum in a transparent manner. Questbook is leading Compound  grants program through delegated domain capital allocation model, a community-run grants program
• We additionally propose that this budget be managed by 4 individuals called Domain Allocators - chosen from the community and by the community. These domain allocators would manage grants for a domain. These domains are strategic areas of focus for which Arbitrum wants to disburse grants
• The performance of each of these domain allocators will be publicly viewable and auditable using rich dashboards. At the end of the quarter, the Arbitrum community can vote to replace, continue domain allocators or increase budgets for each domain allocator.
• We (Questbook.xyz) will help facilitate setting up these domain allocators and provide the tooling to run the grants program in an efficient and transparent way. We have previously set up or currently setting up the grants process for Compound, Polygon, Solana, Celo, and Aave

Motivation

As we continue to experience the depth of the bear market, it is increasingly important for Arbitrum to retain the mindshare of key ecosystem contributors and incentivize builders to build on top of it. Grants program is a great way to attract high-quality builders and grow the ecosystem more quickly. This proposal details the benefit to all the stakeholders involved - token holders, builders and DAO members.

Benefits to Arbitrum

Giving the selected domain allocators the capital and decision-making powers can increase the efficiency of the grants program, without compromising on accountability:

• Individual expertise instead of collective blindspots
• Distributed load instead of committee backlogs
• Accountability instead of diffusion of responsibility

The proposed structure will lead to the following outcomes:

1. Aligned allocation of funds: By leveraging the Delegated Domain Allocator (DDA) model, Arbitrum foundation can ensure that funds are allocated to projects that align with the domain (selected by the Arbitrum community), promoting efficient and effective use of resources. This approach aligns with Arbitrum’s goal of enabling the distribution of grants and empower the community to build and participate in the future of the Arbitrum.

2. Increased transparency: The Delegated Domain Allocator approach provides a clear and transparent process for allocating funds, ensuring stakeholders understand the decision-making process and building community confidence. Questbook, a decentralized grant management platform, provides a transparent space for teams to showcase their backgrounds and experience. In addition, Questbook's reporting features will allow Arbitrum to quickly generate monthly reports on the allocation of funds, with the details for each grant proposal.

3. Increased accountability: With a dedicated group of stakeholders responsible for allocating funds, the Delegated Domain Allocator approach promotes increased accountability, ensuring that the funds are used effectively and efficiently. Domain allocators can be replaced through a community vote if their performance is not up to the standards accepted by the community.

4. Lower Turnaround Time (TAT): The Delegated Domain Capital Allocation model will help improve proposals' turnaround time and overall outcomes for the ecosystem. An example of this is Compound who's already leveraging the DDA model and has a communication TAT of less than 48 hours. The performance of domain allocators will be measured using objectives and key results (OKRs) to ensure goals are achieved efficiently and effectively. .

   

   

   

5. High Brand Recognition : The Delegated Domain Allocator model will play a crucial role in boosting developer engagement with Arbitrum, as well as forming strategic partnerships with important ecosystems to jointly fund grants in mutually beneficial areas.

Specification & Implementation