---
title: "Arbitrum DAO"
url: "https://caper.network/wiki/daos/networks/arbitrum-dao"
updated: 2026-09-03
license: CC-BY-4.0
license_url: "https://creativecommons.org/licenses/by/4.0/"
---

# Arbitrum DAO

|  |  |
| --- | --- |
| **Name** | Arbitrum DAO |
| **Type** | Protocol DAO (Ethereum Layer-2 rollup) |
| **Governance token** | ARB (airdropped 23 March 2023; ~10B supply) |
| **Governance model** | [Token-weighted](/wiki/dao-governance/concepts/voting/token-weighted-voting): [Snapshot](/wiki/dao-governance/tooling/voting/snapshot) temp-check → on-chain Governors (Tally) + a 12-member Security Council |
| **Treasury** | One of the largest DAO treasuries — billions of ARB (track live on DeepDAO / Tally) |
| **Notable for** | The AIP-1 launch controversy; large-scale incentive programs (STIP, LTIPP, Gaming Catalyst) |
| **Primary sources** | [forum.arbitrum.foundation](https://forum.arbitrum.foundation/), [docs.arbitrum.foundation](https://docs.arbitrum.foundation/), [Tally governance portal](https://www.tally.xyz/gov/arbitrum) |
| **Related** | [Optimism Collective](/wiki/daos/networks/optimism-collective), [Treasury management](/wiki/dao-governance/concepts/treasury/dao-treasury-management), [Legal structures](/wiki/dao-governance/concepts/membership/dao-legal-structures) |

The **Arbitrum DAO** governs [Arbitrum](https://arbitrum.io/), a leading Ethereum [Layer-2](/wiki/daos/networks/optimism-collective) ecosystem built on optimistic-rollup technology. It comprises **Arbitrum One** (a full rollup), **Arbitrum Nova** (an AnyTrust chain for gaming and social apps), and the **Orbit / Arbitrum Chains** framework for launching further chains. Arbitrum One is routinely the single largest rollup by value secured, tracked live on [L2Beat](https://l2beat.com/scaling/summary). Holders of the **ARB** token, and the delegates they choose, govern the chains, the treasury, and an elected Security Council. ([Arbitrum docs: a gentle introduction](https://docs.arbitrum.io/welcome/arbitrum-gentle-introduction))

## ARB and the transition to a DAO

Arbitrum was built by **Offchain Labs**, the company founded in 2018 by Ed Felten, Steven Goldfeder, and Harry Kalodner. On **23 March 2023** the **ARB** token launched via a broad airdrop, handing governance to the newly-formed Arbitrum DAO. Of an initial supply of roughly 10 billion ARB, the largest single share — about **42.78%** — was allocated to the DAO treasury, with the remainder split across the team, investors, the user airdrop, and the Arbitrum Foundation. ([Arbitrum Foundation: airdrop distribution](https://docs.arbitrum.foundation/airdrop-eligibility-distribution))

## AIP-1 — the launch controversy

The DAO's very first proposal became one of the industry's cautionary tales. Posted on **15 March 2023**, **AIP-1** was an omnibus package that, among many other things, designated **750 million ARB (7.5% of supply, then worth roughly $1 billion)** to a Foundation-controlled "Administrative Budget Wallet." Delegates discovered that the tokens had **already been moved** — and that the Foundation had already loaned 40M ARB to a market maker and converted more to fiat — before the vote concluded, which the Foundation framed as a **"ratification"** of decisions already made rather than a request. The community **rejected AIP-1 decisively** (over three-quarters of votes against), and the Foundation split it into **AIP-1.1** (placing 700M ARB under a four-year lockup and setting a transparent operating budget) and **AIP-1.2** (which, among other changes, lowered the on-chain proposal threshold from 5,000,000 to 1,000,000 ARB and affirmed the DAO's power to replace Foundation directors). It remains a landmark case study in the gap between a DAO's launch messaging and its actual power. ([CoinDesk](https://www.coindesk.com/business/2023/04/02/contentious-arbitrum-vote-over-1b-in-tokens-ratification-not-request-says-foundation); [AIP-1.1](https://forum.arbitrum.foundation/t/proposal-aip-1-1-lockup-budget-transparency/13360); [AIP-1.2](https://forum.arbitrum.foundation/t/proposal-aip-1-2-foundation-and-dao-governance/13362))

## Governance structure

Arbitrum governance runs under the **Constitution of the Arbitrum DAO**, which sorts proposals into two tracks: **Constitutional AIPs** (amending the Constitution, installing or modifying chain software, or exercising chain-owner powers) and **Non-Constitutional AIPs** (treasury spends, grants, and signaling). A proposal typically begins with an off-chain [Snapshot](/wiki/dao-governance/tooling/voting/snapshot) temperature check, then moves to a binding on-chain vote through the Governor contracts — the **Core** governor for Constitutional matters (higher quorum) and the **Treasury** governor for the rest — with the interface hosted on [Tally](https://www.tally.xyz/gov/arbitrum). A **12-member Security Council**, split into two six-seat cohorts elected by the DAO every six months, can take emergency and non-emergency actions but only with a **9-of-12** supermajority; ordinary treasury and chain actions clear multi-day timelocks before they execute. ([Arbitrum Constitution](https://docs.arbitrum.foundation/dao-constitution); [Security Council](https://docs.arbitrum.foundation/concepts/security-council)) A newer take on the same "token vote plus a technical Security Council" pattern is [ZKsync's ZK Nation](/wiki/daos/networks/zksync-era), which stacks a third body — a Guardians veto — on top of the Assembly and Council.

## Treasury and incentive programs

Holding billions of ARB, the DAO runs one of the [largest treasuries](/wiki/dao-governance/concepts/treasury/dao-treasury-management) in the industry — its dollar value swings heavily with the ARB price, so live figures are best read from [Tally](https://www.tally.xyz/gov/arbitrum/treasury) rather than a fixed number. Much of the DAO's activity has been deploying that treasury as ecosystem incentives: the **Short-Term Incentive Program (STIP)** distributed 50M ARB to protocols in late 2023, followed by a ~21M ARB backfund; the **Long-Term Incentive Pilot Program (LTIPP)** allocated up to 45M ARB in 2024; the **Gaming Catalyst Program (GCP)** earmarked 200M ARB for game development; and the **DRIP** DeFi program and **STEP** real-world-asset allocations followed in 2025. The scale of these programs — and debates over whether spending outruns revenue — has made treasury discipline the DAO's central governance theme. ([STIP proposal](https://forum.arbitrum.foundation/t/arbitrums-short-term-incentive-program-arbitrum-improvement-proposal/16131); [DRIP](https://blog.arbitrum.io/introducing-drip-the-defi-renaissance-incentive-program-on-arbitrum/))

## Foundation and Offchain Labs

Two entities sit alongside the DAO. **Offchain Labs** is the private company that builds the Arbitrum technology; the **Arbitrum Foundation** is a Cayman Islands foundation that administers governance, handles legal and regulatory matters, and executes DAO decisions — and is itself **accountable to the DAO**, which can elect and remove its directors. The Foundation received 7.5% of ARB at genesis and contracts with Offchain Labs for core development; the closeness of these "Arbitrum-aligned entities" is a recurring subject of governance scrutiny. ([Arbitrum Foundation overview](https://docs.arbitrum.foundation/what-foundation))

## How Caper approaches this

AIP-1 is the cautionary tale a [caper](/wiki/foundations/what-is-a-caper) is built to avoid: a foundation moved and spent treasury funds before the ratifying vote had concluded. A caper has no administrative wallet that can pre-spend its treasury — funds leave only through a [PAYOUT or INVEST proposal](/wiki/governance/proposals) that passes the vote and clears an [execution delay](/wiki/governance/execution) — and any member who has voted or traded and disagrees with where the treasury is heading can [exit](/wiki/foundations/leaving-a-caper) for a treasury share sized by their own vote weight rather than depend on a governance fight to claw funds back. The mechanics are described neutrally on those Caper pages.

## References

- [Constitution of the Arbitrum DAO](https://docs.arbitrum.foundation/dao-constitution) — the governing ruleset.
- [Arbitrum DAO Governance Forum](https://forum.arbitrum.foundation/) — where AIPs originate.
- [Tally: Arbitrum governance](https://www.tally.xyz/gov/arbitrum) — on-chain proposals and treasury.
- [AIP-1.1](https://forum.arbitrum.foundation/t/proposal-aip-1-1-lockup-budget-transparency/13360) and [AIP-1.2](https://forum.arbitrum.foundation/t/proposal-aip-1-2-foundation-and-dao-governance/13362) — the post-controversy remedies.
- [L2Beat](https://l2beat.com/scaling/summary) — live rollup standing and value secured.